Before approving a one-time tax on the wealth of billionaires who lived in the state at a certain point in time, Californians should consider what such a policy will do to future tax revenues. Since wealth is mobile, those who stand to lose the most will simply leave, taking their future income-tax payments with them.
BERKELEY—Six Nobel laureate economists recently signed an open letter supporting Proposition 40, California’s Billionaire Tax Act, which, if passed by a simple majority of voters, would impose a one-time 5% tax on the wealth of an estimated 250 individuals with a net worth exceeding $1 billion who resided in California on January 1, 2026. We believe the proposal is poorly designed and likely to do more harm than good.
