Sanders and Newsom Clash Over California Billionaire Tax Proposal

Proposal to tax California billionaires' assets divides Democratic party leaders ahead of midterm elections

Published on Feb. 21, 2026

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As Democrats search for a unifying message ahead of the midterm elections, a California proposal to impose a 5% tax on billionaires' assets has created a rift between progressive Senator Bernie Sanders and Democratic Governor Gavin Newsom. Sanders is campaigning for the tax, which would fund health services, while Newsom warns it could lead to an exodus of billionaires and financial crisis for the state.

Why it matters

The debate over taxing California's billionaires highlights the growing divide within the Democratic party, with progressives like Sanders pushing for wealth taxes to address inequality, while moderates like Newsom are concerned about the economic impacts. This issue could become a wedge that distracts from other key priorities for Democrats heading into the midterms.

The details

The proposed tax, backed by a large healthcare union, would levy a one-time 5% tax on billionaires' assets including stocks, art, businesses, and intellectual property. Sanders supports the tax, saying it's needed to address 'unprecedented and growing wealth and income inequality.' However, Newsom and his allies warn it could trigger an exodus of billionaires and cost the state hundreds of millions in tax revenue. The proposal has already become a point of contention in California's gubernatorial and down-ballot races.

  • Sanders is planning a rally in Los Angeles on Wednesday, February 18, 2026 to campaign for the tax proposal.
  • The proposal must gather over 870,000 petition signatures to make the November 2026 ballot.

The players

Bernie Sanders

A U.S. Senator from Vermont and a prominent progressive voice in the Democratic party, who is campaigning for the California billionaire tax proposal.

Gavin Newsom

The Democratic Governor of California, who is an outspoken opponent of the billionaire tax proposal, warning it could lead to a financial crisis for the state.

Brian Brokaw

A longtime advisor to Governor Newsom who is leading a political committee opposing the billionaire tax proposal.

Chad Bianco

A Republican candidate for California governor who has warned the tax would erase jobs.

Matt Mahan

A Democratic candidate for California governor who has said inequality starts at the federal level with the tax code.

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What they’re saying

“Our nation will not thrive when so few own so much.”

— Bernie Sanders (X)

“The issues that are really going to be motivating Democrats this year, affordability and the cost of health care and cuts to schools, none of these would be fixed by this proposal. If fact, they would be made worse.”

— Brian Brokaw, Longtime Newsom Advisor

What’s next

The proposal must gather over 870,000 petition signatures by an upcoming deadline to make the November 2026 ballot in California.

The takeaway

The debate over taxing California's billionaires has exposed a rift within the Democratic party, pitting progressives like Sanders who see it as a way to address inequality against moderates like Newsom who are concerned about the economic impacts. This issue could become a distraction for Democrats heading into the crucial 2026 midterm elections.