Proposed billionaire tax backed by majority of California voters

More than half of likely California voters support a proposed wealth tax on billionaires despite multiple reports and research questioning the benefits and potential harm to the state’s economy.

A survey by the Public Policy Institute of California said 54% of likely voters agree with the tax, which would would impose a one-time 5% levy on California residents with assets exceeding $1 billion. Labor unions, who helped initiate the proposal, said they have enough signatures to qualify for the November ballot.

The survey was conducted from May 14 to 18 on 986 likely voters.

Democrats were much more likely to vote yes on the tax at 76%. Republicans were largely opposed with 82% against the measure, according to the institute. Independents were more balanced, with 53% of them in favor.

When the survey looked at voters’ income, those making making less than $100,000 decisively were in favor of the tax, but higher-income voters were more split. Just 52% of such voters said they would vote ‘yes.’

While renters favored the tax 71% to 27%, home-owning Californians saw a nearly 50-50 split in their stances on the issue.

Support was stronger in urban areas like Los Angeles than in the Central Valley, where 56% of likely voters said they would vote ‘no.’

Business groups and other opponents, including Gov. Gavin Newsom (D), have warned the state’s economy would be devastated by such a tax with CEOs fleeing the state alongside potential jobs. More than 108,000 jobs could be lost if the tax goes into effect, one analysis concluded, and $28 billion worth of wages would also be lost in California.

Unions insist the tax is needed to help California grapple with federal funding cuts and changes to the state’s health care and other systems.

But a paper released Wednesday by the Hoover Institution disputed claims by supporters that the tax would address a “$19 billion-per-year budget hole” caused by Washington. California had a spending problem with its Medicaid program that predated the federal cuts, researchers said.

“Costly spending increases reflect Sacramento’s inability to control a program it expanded through its own policy choices. A wealth tax doesn’t fix this spending problem; it just delays the reckoning,” said Joshua D. Rauh, an economics fellow at Hoover.

Still, supporters are doubling down on using the impending health care cuts to campaign for the tax. They pointed Thursday to a report that California’s uninsured population could double from the cuts and federal Medicaid work rules.

“California is heading toward a healthcare affordability and accessibility crisis,” said Debru Carthan, executive vice president of SEIU-UHW, one of the lead unions behind the tax proposal.

“Because of massive federal healthcare cuts, millions of Californians will lose coverage and hospitals will be forced to close their doors forever, unless billionaires finally pay their fair share.”

Already, a number of the ultrawealthy have announced they’ve left California. Some, like Google co-founder Sergey Brin, are pouring money into competing ballot initiatives.

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