California Billionaire Tax Splits Democrats, Draws Newsom and Zuckerberg Pushback

WHO:

KQED - California Gov. Gavin Newsom opposes Proposition 40, a proposed wealth tax, despite earlier saying the U.S. tax system is “fundamentally broken” and calling for “a true minimum tax on billionaires.”

KQED - Proposition 40 supporter Lorena Gonzalez is president of the California Federation of Labor Unions; Saikat Chakrabarti is co-founder and president of New Consensus; Fernando Guerra is a political science professor at Loyola Marymount University; Jim Kessler is with the think tank Third Way.

KQED - Billionaire Chris Larsen has donated more than $12 million to oppose Proposition 40 and said he expects to support Newsom in a presidential run. Tech billionaires named as campaign funders include Larsen, Elon Musk and Marc Andreessen.

KQED - Meta CEO Mark Zuckerberg, Google co-founder Sergey Brin, former Vice President Kamala Harris and former House Speaker Nancy Pelosi are named in the article’s account of the measure and political debate.

Yahoo Finance - Meta’s board agreed to create nonvoting Class C stock that lets Zuckerberg sell shares to cover a potential Proposition 40 tax bill.

The San Francisco Standard - The California Teachers Association (CTA) and California Building Trades oppose Proposition 40; the California Labor Federation, California Federation of Teachers, National Union of Healthcare Workers and California Nurses Association endorse it.

The San Francisco Standard - United Teachers Los Angeles has about 35,000 members; United Educators of San Francisco represents about 6,500 teachers and staff. The San Diego Building Trades Council represents more than 35,000 construction workers; Sheet Metal Workers’ Local 104 represents about 10,000 members.

WHAT:

KQED - Proposition 40 proposes a one-time 5% tax on the wealth of about 200 California billionaires to help replace federal Medicaid cuts; nearly 15 million Californians receive Medicaid coverage.

Yahoo Finance - Zuckerberg’s estimated liability exceeds $11 billion. He may immediately sell up to 20% of his new Class C shares—10% of his overall economic stake—without reducing his voting control.

Yahoo Finance - Zuckerberg controls roughly 60.6% of Meta’s voting power through Class B shares; selling enough to cover the tax could reduce his stake to 53%.

The San Francisco Standard - A Citrin-Politico poll found 46% of likely voters supported Proposition 40 and 43% opposed it. Stanford economists estimated about $30 billion in tax revenue and $39 billion in lost income-tax revenue over time.

KQED - Proposition 40 opponents include the CTA and some other unions; local teachers’ and building-trades unions have endorsed the measure despite statewide leaders’ opposition.

WHERE:

KQED - The proposed tax concerns California residents; campaign ads criticizing Newsom were placed in South Carolina, Nevada, New Mexico, Virginia and New Hampshire.

The San Francisco Standard - Local union endorsements include San Francisco, Los Angeles, San Diego, the Bay Area and Northern California.

WHY:

KQED - Newsom says a state-only wealth tax could drive billionaires and businesses elsewhere and ultimately hurt California’s budget; he argues such a tax should be national.

KQED - Supporters say the revenue would help offset federal healthcare cuts. Critics of Newsom say opposition may reflect concern about donors and presidential politics; Newsom’s defenders say it could appeal to centrist Democrats.

The San Francisco Standard - Opposing unions say the tax could drive billionaires out and reduce revenues funding infrastructure, schools and construction jobs.

HOW:

Yahoo Finance - The measure would apply a 5% assessment to California residents worth at least $1 billion, based on their assets as of January 2026, payable in annual installments over five years. SEIU-UHW projects $100 billion in revenue; 90% would go to healthcare programs.

Yahoo Finance - Meta structured the new nonvoting Class C shares as a dividend-style stock split; Zuckerberg committed to remain a California resident for eight full years.

The San Francisco Standard - SEIU-UHW proposed the measure; union locals backing it diverged from some statewide labor leaders.

(UPDATED October 27, 2026 04:09 UTC)

California’s Proposition 40 would impose a one-time 5% tax on the wealth of roughly 200 billionaires who live in the state, with supporters saying the money would help replace federal Medicaid cuts affecting nearly 15 million Californians. Gov. Gavin Newsom opposes the measure, warning that billionaires and businesses could leave and hurt the state budget, while labor unions are divided and a poll found 46% of likely voters support it and 43% oppose it. Meta has created nonvoting shares that could let CEO Mark Zuckerberg sell stock to cover an estimated tax bill exceeding $11 billion without giving up voting control.