California Billionaire Tax Divides Progressive Democrats

A union-backed proposal to tax the state's wealthiest faces opposition from some liberal lawmakers and labor leaders.

Apr. 9, 2026 at 8:18pm by Ben Kaplan

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A serene, cinematic painting of the California state capitol building, with the structure bathed in warm, diagonal sunlight and deep shadows, conveying a sense of quiet contemplation and the political complexities surrounding the proposed billionaire tax initiative.The California state capitol building stands as a symbol of the political tensions over a proposed billionaire tax measure that has divided the state's progressive movement.San Francisco Today

A union-backed proposal to tax California's billionaires to fund health care has put some progressive lawmakers and their labor allies in a quandary. While the idea of taxing the rich appeals to the party's left flank, critics question the feasibility of the measure and fear it could drive wealthy residents out of the state. Some labor leaders and progressive legislators have kept quiet on the issue, wary of the political implications of opposing a measure that embodies a core tenet of their base.

Why it matters

The debate over the '2026 California Billionaire Tax Act' highlights the tensions within the progressive movement, as labor unions and lawmakers grapple with the practical and political challenges of implementing a wealth tax. The outcome could have significant implications for the state's budget, the power dynamics between labor and business interests, and the broader progressive agenda in California.

The details

The proposed initiative would levy a one-time 5% tax on any California resident with a net worth exceeding $1 billion, which would apply to around 200 people. The revenue would be used to plug an estimated $100 billion hole left by federal cuts to Medi-Cal and other social service programs. Critics question the feasibility of accurately appraising billionaires' total wealth, fear long-term revenue loss by driving the wealthy out of the state, and resent that the measure is designed to predominantly benefit the sponsoring union's members rather than the state's general fund.

  • The proposed initiative is on track to qualify for the November 2026 ballot.
  • More than $50 million in opposition spending has already been reported from billionaires such as Google co-founder Sergey Brin and cryptocurrency mogul Chris Larsen.

The players

SEIU-United Healthcare Workers West

The union sponsoring the '2026 California Billionaire Tax Act' initiative.

Sen. Bernie Sanders

A prominent national figure who has voiced support for the billionaire tax proposal.

Robert Reich

A liberal economist who has also backed the billionaire tax initiative.

Gov. Gavin Newsom

The California governor who has publicly expressed his disdain for the proposed measure.

Keely Martin Bosler

A former top state budget officer who has advised several of California's most powerful labor groups and is now a Democratic consultant critical of the way the tax is structured.

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What they’re saying

“It's not that taxing billionaires in itself is wrong. The way in which this tax specifically is constructed is problematic.”

— Keely Martin Bosler, Democratic consultant

“What we have is a group of so-called leaders who are not reflecting the attitudes of their own constituents. That's why they want to be anonymous.”

— Dave Regan, President, SEIU-United Healthcare Workers West

“The state is not a miracle worker, like, they're not going to suddenly be able to do all of this like perfectly. I mean they will do their best, but I just think this is expertise that they have built up over 50-plus years. Like, none of this is in their wheelhouse at this point.”

— Keely Martin Bosler, Democratic consultant

What’s next

The proposed '2026 California Billionaire Tax Act' is on track to qualify for the November 2026 ballot. If it does, progressive critics will be faced with the tricky optics of opposing or not supporting a measure that embodies one of their base's core tenets: taxing the rich.

The takeaway

The debate over the California billionaire tax proposal highlights the tensions within the progressive movement, as labor unions and lawmakers grapple with the practical and political challenges of implementing a wealth tax. The outcome could have significant implications for the state's budget, the power dynamics between labor and business interests, and the broader progressive agenda in California.