Overview
- Mark Cuban escalated the dispute on Wednesday by posting on X that Proposition 40’s one‑time 5% levy would force “cash poor, stock rich” founders to sell equity or leave California and that he would require companies to relocate before investing.
- Rep. Ro Khanna responded with a loan proposal in which the state would lend founders cash secured by their shares, a plan that critics say could result in California taking private company stock if loans go unpaid.
- Experts and reporters point to clear implementation problems: many founder holdings are illiquid, banks may not lend against early‑stage shares, and forced sales would harm company growth and complicate valuation.
- The ballot fight is intensifying ahead of the November 3 vote as well‑funded opponents and rival measures mobilize, polls show a narrow race, and legal and revenue estimates from academics and the state remain uncertain.
- Coverage divides along political lines, with outlets warning that the tax could drive billionaires and future founders out of state and supporters saying it would fund healthcare, schools and food assistance while holding wealthy residents accountable.