Zuckerberg Could Owe $12.5 Billion Under California's Proposed Wealth Levy

California voters will decide in November whether to impose a one-time 5% tax on the net worth of every billionaire residing in the state. The measure, known as Proposition 40, targets a group of slightly more than 200 individuals. If the proposal passes, the levy would apply retroactively to anyone who held assets worth at least $1 billion and lived in California as of January 1, 2026.

Supporters argue the tax will raise $100 billion to offset federal funding cuts to the state’s healthcare system. These cuts stem from President Donald Trump’s recent tax and spending legislation. Suzanne Jimenez, a leader with Service Employees International Union-United Healthcare Workers West, described the measure as a "short-term solution" to prevent a collapse of healthcare infrastructure while longer-term funding methods are developed.

Governor Gavin Newsom, whose term is ending, opposes the tax. He warns that the levy could push wealthy residents and their income tax revenue out of California. Google cofounder Sergey Brin has donated more than $100 million to a political organization funding ballot measures that could block the proposal, according to the Los Angeles Times. A September poll by the Los Angeles Times and the Berkeley Institute of Governmental Studies found 45% of likely voters in favor, 42% opposed, and 13% undecided.

Meta CEO Mark Zuckerberg told the company’s board last month that he is considering moving his primary residence out of the state. Meta, which is headquartered in California, agreed to a new stock deal that grants Zuckerberg additional shares to cover potential losses. He could owe as much as $12.5 billion under the proposal. DoorDash cofounder Andy Fang called the measure "stupid".

Other billionaires hold differing views. Nvidia chief Jensen Huang told CBS that he does not mind paying taxes and accepts that higher incomes should result in higher tax payments. Senator Bernie Sanders told a Los Angeles rally that billionaires believe they have a "God-given right to rule" and predicted that voters would teach them a "very powerful lesson" on November 3.

The state has the largest economy in the United States and the fourth largest in the world. Despite this size, California has the nation’s largest share of homeless people and one of the widest wealth gaps. Francesco Trebbi, a public policy professor at the University of California, Berkeley, believes this is the first billionaire tax targeting such an extreme percentile of the wealth distribution.

At least six of the state’s billionaires have reportedly left, including Google cofounders Larry Page and Sergey Brin, venture capitalist Peter Thiel, former Uber boss Travis Kalanick, and Hankey Group founder Don Hankey. Hankey told Forbes that he moved to Nevada because the proposal made him feel he was not "wanted." Washington state voters are also weighing a 9.9% tax on income over $1 million per year.