Prop 40 is on its death bed despite huge wins for progressives. Here’s what went wrong
Jane Kim, Sen. Bernie Sanders and Rep. Ro Khanna stand together at a "Ballots Over Billionaires" rally at the Curran Theatre in San Francisco on Oct. 3, 2026.
TL;DR
- Proposition 40, a proposed one-time 5% wealth tax on individuals worth over $1 billion, is failing in California.
- Opponents spent nearly $400 million to defeat Proposition 40 and related measures.
- Backers of Proposition 40 cited strong national polls showing support for taxing billionaires, including among Republicans and independents.
- The defeat is partly due to a lack of broad coalition-building among California Democrats, key unions, and progressive organizations.
- Governor Gavin Newsom and other influential Democrats opposed Proposition 40, fearing it would drive entrepreneurs out of the state.
- Despite progressive wins in other races, key players did not fully endorse Proposition 40, leading to grassroots leaders and some unions staying on the sidelines.
- The SEIU-United Healthcare Workers West, which placed the tax proposal on the ballot, was criticized for not building a wider coalition and for internal issues involving its leader, Dave Regan.
- Supporters intend to try again with a wealth tax on a future ballot, emphasizing the need for better coalition-building.
- A similar tax on healthcare insurers and services, Proposition 35, passed with 68% support, indicating support for specific tax measures when broader consensus is achieved.