Prop 40's Wealth Tax Keeps Gaining Enemies Among the People It's Supposed to Save

By late July the opposition list had grown from healthcare providers to a broad coalition: the California Teachers Association, carpenters, builders, housing advocates, and law enforcement all formally opposed Prop 40. The state’s nonpartisan Legislative Analyst’s Office reinforced their case, projecting hundreds of millions in ongoing income-tax losses as some of the ~200 affected billionaires leave California. The measure’s backers, SEIU-UHW, spent $31 million gathering signatures — but the people named as beneficiaries kept lining up against it.

The California Medical Association, California Primary Care Association, and Planned Parenthood all came out against the measure within days of its qualifying for the ballot on June 17. These are providers the tax claims to rescue. Their objection: the $100 billion is a one-time windfall routed through annual legislative appropriations, with no formula guaranteeing dollars to any hospital or clinic. The LAO found the gain would likely be offset by a permanent drop in income-tax revenue as billionaires relocate.