California is proposing a one-time 5% tax on billionaires, which could generate approximately $100 billion for the state. The initiative, backed by the Service Employees International Union–United Healthcare Workers West, would affect anyone residing in California as of January 1, 2026. Under this measure, individuals with $20 billion in assets would owe $1 billion, payable over five years.
The announcement has triggered strong reactions from tech billionaires, including Peter Thiel and Larry Page, both of whom are reportedly considering relocating their operations outside the state. Thiel is contemplating moving Thiel Capital's office, while Page has started the process of shifting three of his LLCs to Florida.
Tax advisor David Lesperance noted that many clients are actively looking to sever their California residency and move their assets. Chamath Palihapitiya, another prominent investor, echoed this sentiment, suggesting that talented entrepreneurs may choose to establish their ventures in states with less burdensome tax structures.