Billionaires Race to Leave California Over Proposed 5% Wealth Tax

By Solange Reyner | Monday, 29 December 2025 09:44 PM EST

Some billionaires are reportedly considering relocating from California by year’s end following discussions about a potential one-time 5% wealth tax that would appear on the November 2026 state ballot.

The initiative, known as the 2026 Billionaire Tax Act, would impose a single 5% levy on all “forms of personal property and wealth, whether tangible or intangible” owned by billionaires in California. The tax aims to fund state healthcare programs such as Medi-Cal.

California Governor Gavin Newsom has not endorsed the proposal; it was filed last month with the state attorney general’s office by the Service Employees International Union (SEIU).

The union contends that billionaires have utilized state resources to amass their wealth and were the primary beneficiaries of federal legislation contributing to California’s budget crisis.

Tech investor Peter Thiel and Google co-founder Larry Page are reportedly exploring plans to scale back or sever their ties with California before year’s end. Three individuals stated Thiel has considered establishing an office for his investment firm in another state and spending more time there. Page filed documents in mid-December to incorporate in Florida, according to state records, and has been reported to discuss leaving the state by the end of 2025.

David Lesperance, a tax adviser who works with California billionaires in venture capital and private equity, said some clients are preparing contingency plans to safeguard their assets ahead of the proposed vote. “Elon Musk, Tim Cook — any of these guys, they don’t need to be in Palo Alto in order to do what they do,” he added.

The tax initiative requires approximately 870,000 valid signatures by June 25, 2026, to reach the state ballot.

When asked about support for similar policies from figures like New York Mayor-elect Zohran Mamdani, Newsom responded: “So, it’s not something to be panicked about.”

Garry Tan, CEO of San Francisco-based tech startup accelerator Y Combinator, opposed the tax despite its potential personal impact. He argued that California should focus on retaining entrepreneurs and investors to create jobs and fuel economic growth. Tan said: “Driving capital out of the state will hurt innovation and ultimately make it harder, not easier, to support healthcare and essential services.”

Solange Reyner is a writer and editor for Newsmax. She has more than 15 years in the journalism industry reporting on news, sports, and politics.