The proposed levy could cost the Google co-founder billions, but another tech leader says he would accept the charge without hesitation.
Google co-founder Sergey Brin has donated another $20 million to Build a Better California, an organization campaigning against California’s proposed billionaire tax. Following the new contribution, Sergey Brin’s total spending to oppose the initiative has exceeded $100 million.
What Prop 40 Would Introduce
The Prop 40 initiative, known as the “billionaire tax,” proposes a one-time levy of 5% on the net worth of roughly 200 of California’s wealthiest residents.
Sergey Brin’s fortune is estimated at around $267 billion. Under these terms, his potential payment under Prop 40 could amount to approximately $13.3 billion.
Revenue from the new levy is primarily intended to fund the state’s healthcare programs. California expects its Medicaid program could lose up to $30 billion in federal funding after Donald Trump’s budget cuts take effect next year.
Who Opposes the Billionaire Tax
Sergey Brin is not the only wealthy California resident critical of the possible introduction of the new levy. According to media reports, Meta founder Mark Zuckerberg purchased a $170 million estate near Miami this year.
Former Uber CEO Travis Kalanick, venture capitalist Peter Thiel, and Google co-founder Larry Page have also left California.
California Governor Gavin Newsom has expressed concerns about Prop 40. He believes that the departure of the wealthiest residents and their companies from the state could have negative economic consequences. At the same time, Gavin Newsom supports the idea of introducing a nationwide billionaire tax.
Today, an office worker may pay a higher tax rate than an heiress. We need to put an end to “tax-free lifestyle loans” – a scheme that allows ultra-wealthy people to borrow against their stock portfolios without reporting taxable income.
– Gavin Newsom in a blog post
California Vote and Alternative Initiatives
A vote on Prop 40 is scheduled in California for November. Build a Better California, which is funded by Sergey Brin, is also backing alternative ballot initiatives.
If voters approve these alternatives, they could significantly limit the ability to introduce new taxes in the state. This, in turn, could effectively block the implementation of Prop 40.
Jensen Huang’s Position
Nvidia co-founder Jensen Huang said that he does not object to such a levy. According to the article’s estimate, his potential tax liability could amount to roughly $8 billion.
I haven’t even thought about it once. We chose to live in Silicon Valley, and whatever taxes they want to impose, so be it. I’m completely fine with that.
– Jensen Huang in an interview with Bloomberg in January
As a result, Prop 40 has become one of California’s key tax debates. The initiative concerns not only the funding of healthcare programs, but also whether the state’s ultra-wealthy residents should pay an additional tax on their fortunes.