The “2026 Wealth Tax” proposed by the California union is currently gathering signatures to push for a referendum. Critics argue that the proposal is prompting billionaires and large corporations to accelerate their exodus from blue states and move to red states with lower taxes, less regulation, and more business-friendly environments. This significant corporate relocation and wealth transfer is expected to have profound social and economic implications.
The “Wealth Tax” was initiated by SEIU–United Healthcare Workers West, proposing a one-time tax equivalent to 5% of the net assets of California residents with assets exceeding $10 billion starting from January 1, 2026, allowing payment over five years. The sponsors estimate that about 200 individuals will be affected, with a total wealth of up to $2 trillion, potentially generating approximately $100 billion in tax revenues. Around $90 billion is earmarked to fill the funding gap in California’s healthcare insurance system.
Travis Kalanick, the co-founder and former CEO of Uber, officially moved to Texas, known as the “Lone Star State,” on December 18th last year, emphasizing that he left California before the new tax took effect. According to Forbes’ estimates, the 49-year-old Kalanick has a net worth of approximately $3.6 billion. If he had remained in California, he might have had to pay around $180 million in wealth tax.
When asked about the reason for relocating, he jokingly mentioned experiencing “FOMO” upon seeing old friends like Zuckerberg, Page, and Brin moving to Florida and purchasing luxury homes around Miami, feeling a fear of missing out. Although not particularly drawn to Florida, he humorously remarked on his friends’ mass migration to the state.
David Sacks, former PayPal COO and current White House special advisor on AI and cryptocurrency, harshly criticized the tax on X social media platform, calling it a “comprehensive confiscation of 5% of personal assets,” essentially an unrealized income tax that might include assets already taxed.
When questioned about leaving California, he cryptically replied, “Who says I haven’t left yet?” subtly indicating his departure. Sacks, previously residing in the Pacific Heights neighborhood of San Francisco known as the “Billionaire’s Row,” with a net worth estimated at least $2 billion, could potentially save about $10 million or more in taxes by leaving California.
By the end of last December, he posted on X, stating, “After blindly funding the left for many years, Silicon Valley’s billionaires have finally realized it’s dinner time, and this time, they are on the menu.”
William Ackman, founder and CEO of Pershing Square Capital Management, also warned that “California is on a path to self-destruction.” Currently residing in New York, Ackman’s net worth is approximately $9 billion.
Several tech giants’ founders or co-founders, including Facebook/Meta, Google, Palantir Technologies, and Oracle, chose to move to Florida. Forbes released its “Global Billionaires List” in March this year, providing the asset data mentioned above.
Mark Zuckerberg’s net worth is approximately $222 billion. If he stayed in California, he could face around $10.7 billion in taxes. He moved to the exclusive “Billionaire Bunker” enclave in Miami, Florida, in December last year.
Google’s co-founders Larry Page and Sergey Brin also left California in December last year. Page’s assets are around $257 billion, while Brin’s are approximately $237 billion. If they remained California residents, they might face taxes of around $12.85 billion and $11.85 billion, respectively. Reportedly, 45 LLCs related to Page have applied to shut down or move out of California, with 15 of Brin’s companies dissolved or relocated, with 7 transferring to neighboring Nevada.
Oracle’s founder, Larry Ellison, sold his mansion in the Pacific Heights of San Francisco at the end of last year. With a net worth of around $199 billion, he could potentially pay about $10 billion in wealth tax if not relocating from California.
Venture capitalist Peter Thiel, one of the first billionaires to take action, now primarily resides in Florida. As a co-founder of PayPal, Palantir Technologies, and Founders Fund, his net worth is approximately $28.4 billion. If he had stayed in California, he might have to pay around $1.42 billion in taxes.
Some billionaires who remain in California openly express their opposition. Andy Fang, co-founder of DoorDash and a Taiwanese-American, stated, “I love California, where I was born and raised, but proposals like this make you feel irresponsible if you don’t plan to leave in advance.”
He pointed out that the tax could equate “voting rights” to “equity ownership.” For example, someone holding 1% of shares but owning 50% of voting rights might be taxed at 50%, potentially depleting all his liquid assets. Fang’s net worth is about $1.43 billion, emphasizing founder-led is core to the company, and he would fiercely defend this principle.
Brendan Fuddy, the 22-year-old CEO of Mercor, criticized taxing illiquid pre-IPO equity as “extremely absurd.” When asked if he had left California, he mentioned the concentration of company employees and clients in San Francisco, hence still needing to stay locally.
Vinod Khosla, founder of Sun Microsystems and Khosla Ventures, with assets around $12.1 billion, warned that the tax could cause irreversible and permanent damage even without official approval.
Reid Hoffman, co-founder of LinkedIn and a significant donor to the Democratic Party, pointed out that poorly designed tax policies would stimulate tax evasion, capital flight, and market distortions, ultimately reducing tax revenues.
Michael Moritz, a venture capitalist and author, stated that California has heavily relied on a few super-rich individuals over the past 50 years, finding it challenging to cope with their departures. He added that this proposal is just the latest case of “a series of destructive policies.”
Jensen Huang, CEO of Nvidia, appears to be one of the few tech giants publicly expressing indifference to the proposed tax. With a net worth of about $154 billion, if he remained in California, he would potentially pay around $7.7 billion in taxes. In a Bloomberg TV interview, Huang mentioned that he hadn’t seriously considered the tax, stating, “We choose to plant our company and family in Silicon Valley. Whatever the government taxes, let it be. I have no opinions.”
These moves and responses from various prominent figures in the tech and business world underscore the debates and concerns surrounding the proposed “Wealth Tax” in California and its potential implications for the economy and society.