California wealth tax could push billionaires out, entrepreneur warns

Key Points:

• California entrepreneur Eric Schiffer warned that the proposed billionaire wealth tax (Proposition 40) could drive successful business leaders out of the state, resulting in a "giant sucking sound" of entrepreneurs leaving if the measure passes.
• Proposition 40, on the November 3 ballot, would impose a one-time 5% tax on net worth for billionaires who are California residents as of January 1, 2026, with some exclusions like real estate and retirement accounts.
• Schiffer argued the tax could reduce business opportunities, jobs, and tax revenue for all Californians, as entrepreneurs may relocate, and warned the tax could eventually target individuals with smaller fortunes.
• The California Legislative Analyst's Office estimates some billionaires might leave, causing less income tax revenue, but the wealth tax could generate tens of billions of dollars temporarily; Schiffer stated he would leave if the tax expanded beyond billionaires.
• Supporters like Rep. Ro Khanna say the tax would fund healthcare for working-class Californians, while opponents argue it undermines the state's business climate and entrepreneurial spirit.