Overview
- Proponents of California’s proposed one-time 5% tax on residents worth over $1 billion released an open letter saying only the fair market value of actual shares would be taxed, not extra voting power tied to super-voting stock.
- The ballot measure is still gathering signatures and would apply to people worth more than $1 billion who live in California on January 1, 2026, with payments allowed in 1% installments over five years.
- Backers say fears that founders could be taxed as if they owned far more than their economic stake are misinformation, while a tax-policy critic warns the measure’s wording could still be interpreted more broadly by regulators or courts.
- California’s debate follows a broader push in Democratic-led states, with Washington enacting a new 9.9% top income tax on earnings over $1 million and Michigan advancing a plan for a 9.25% top rate over $500,000.
- Reporting across outlets describes wealthy residents and firms planning moves or leaving high-tax states, with examples including Google co-founders shifting interests to Nevada and investors opening offices in Florida and Texas, while New York’s governor has voiced concern about an eroding tax base.