California Governor Gavin Newsom's office announced on June 19, 2026, that it remains opposed to a proposed tax on billionaires in California, despite revisions made by the labor union backing the measure. The new initiative, proposed by the Service Employees International Union–United Healthcare Workers West, seeks to impose a one-time 2% tax on individuals with a net worth exceeding $1 billion. Newsom argues that the tax could weaken California's economy and reduce future revenue.
The governor has indicated a commitment to defeating the measure, which is expected to appear on the November ballot. Gubernatorial candidates Steve Hilton and former Health and Human Services Secretary Xavier Becerra have also expressed opposition to the proposal.
The union had previously proposed a 5% tax but revised it to a 2% rate in hopes of gaining Newsom's support. However, Newsom rejected this offer, emphasizing that the measure's fundamental flaws would harm working Californians.
The proposed tax aims to generate approximately $100 billion, with supporters claiming it would help offset federal cuts to healthcare programs for low-income residents. Critics, particularly from the technology sector, warn that the tax could force wealthy individuals to sell assets to meet tax obligations, potentially disrupting businesses.
Concerns have been raised about California's ability to retain wealthy residents, as some billionaires have relocated to states with lower taxes. Newsom has opposed a state-level wealth tax since 2020.