capital flight BS
estb 2 26 see TAX RICH WEALTH
-=-=
ROBT R VID 8 26
-=-=
PROP 40 WIKI 9 26
In a guest essay for The New York Times, Gabriel Zucman and initiative co-author Saez responded to concerns about billionaires fleeing the state, claiming that because billionaires are able to avoid income tax on most earnings, "even if all of them left the state, it would take 25 years for the loss of their tax payments... to surpass the amount the state would raise" if the initiative passes.[28]^ In a working paper, Saez and Zucman, alongside co-author Jasper Boll of the Paris School of Economics, estimated that California billionaires annually pay state income tax equal to about 0.2 percent of their total wealth, making up 2.4 percent of California's total income tax revenue.[29]^
Economist Teresa Ghilarducci of the Economic Policy Institute, a pro-union think tank, considered an exodus of billionaires due to the tax unlikely, pointing to a 2022 Massachusetts 4% surtax on income above $1 million that exceeded projected revenue.[30]^ Nuveen, an asset management company, also concluded billionaire outmigration was unlikely and that the tax posed minimal risk to California's credit profile and municipal bonds.[31]^
-=-=
FORTUNE MAG
Six of California’s 214 billionaires have been widely reported to have left the state in time to avoid a proposed 5% wealth tax—but that small cohort would have collectively generated $27 billion in tax revenue, roughly a fourth of the initiative’s projected $100 billion haul.
Recommended Video
Last November, panic erupted over the announcement of a proposed billionaire’s tax in California. The tax would levy a one-time 5% tax on the net worth of California residents with assets worth at least $1 billion. California’s progressive governor, Gavin Newsom, emerged as the measure’s biggest opponent and vowed to stop the tax to “protect” the state’s tech industry and overall economy.
Before the Jan. 1, 2026, cutoff proposed in the initiative, Google cofounders Larry Page and Sergey Brin, and venture capitalist Peter Thiel, left California for Miami. Car loan magnate and L.A. native Don Hankey left the state for Las Vegas. Former Uber CEO Travis Kalanick recently announced he had left California for Texas in December. Director Steven Spielberg became a New York City resident on New Year’s Day, according to the Los Angeles Times, although his representative said the Jaws director had long planned to move to be closer to family.
The tally of departed billionaires likely understates the extent of the flight. Meta CEO Mark Zuckerberg has also reportedly left the state, but not before the Jan. 1 deadline. Venture capitalist David Sacks, whose net worth has been reported to range from $250 million to $2 billion, also left the state as his company Craft Ventures moved to Austin. Zuckerberg would take another roughly $10 billion of tax revenue with him.
If the state were to tax Page’s $260 billion net worth at 5%, it would rake in $13 billion in tax revenue. Brin’s taxes would bring in about $12 billion. While Thiel, Kalanick, and Hankey may not rank among the top five richest men in the world, together they would have generated $1.775 billion.
The loss of a fourth of the proposed tax revenue is a major hit to the initiative, which intends to use the funds toward health care, education, and food assistance.
Billionaires are backing a fight
Billionaires in and outside of California are working to fight the tax, which has been a harbinger for more wealth taxes across the country.
Brin donated $20 million to a group called Building a Better California that is giving out $15 to people who sign their three countermeasures. The group’s proposals would prevent retroactive taxes and narrow the definition of California residency to fight against the 2026 Billionaire Tax Act’s application to anyone who lived in the state as of Jan. 1, 2026.
Two billionaire-backed political action committees, Stop the Squeeze and Golden State Promise, have launched to stop the proposal.
Chicago-based venture capitalist Daniel Tierney donated $200,000 to Stop the Squeeze, and crypto billionaire Chris Larsen is backing Golden State Promise, the *New York Times* reported.
Since the California initiative was announced, other states have proposed higher taxes on their high-earning residents. In January, Rhode Island Gov. Dan McKee backed a 3% tax increase on millionaires. Last week, Washington, which is one of nine states without an income tax, passed a 9.9% tax on personal income above $1 million per year.
“We’ve got more millionaires and billionaires than we’ve ever had, and they’re paying, effectively, a 4% tax rate,” Rep. Brianna Thomas, of Seattle, a Democrat who supported the measure, previously told Fortune. “Meanwhile, you got working folks paying 11% of their income, and the lowest-income people paying 14%. Isn’t it unfair for those who have the most, to pay the least, and those who have the least to pay, the most, proportionally?”
-=-=
---
AN 2 26
WSJ warns Trump’s billionaire tax cut is hurting the US economy
The Wall Street Journalhas a history of loving tax cuts, but in a new report, they're warning that President Donald Trump's billionaire tax cuts are hurting the U.S. economy.
As recently as Dec. 31, the Journal was singing the praisesof the nine states in which people would pay less in taxes. A little over a month later, Carol Ryan wrote that when billionaires don't pay their taxes, "look at who picks up the tab."
"Wealth concentration is affecting the wider economy," the report said, and it "shows why the issue isn’t going away."
California is proposing a wealth tax, which WSJ is concerned about, but only because for many rich households, their money is tied to the stock market.
"This could mean the entire economy pays a steep price in the next market correction," the report said.
"California has the highest concentration of billionaires in the U.S. with 255 individuals, or slightly more than a fifth of the country’s billionaire population," the report said, citing the wealth-intelligence firm Altrata.
A proposal for a ballot measure in November would levy an amount "calculated based on whichever is the higher of a billionaire’s voting interest or economic interest in a company." It would be a one-time levy on the wealth of any California resident worth over $1 billion. The solution is an idea to fix the Medicaid shortfall left by the GOP's significant cuts to the program in the "One Big Beautiful Bill" measure passed last year.
The right-wing Tax Foundation claims it will hurt tech leaders.
The ultrarich could simply leave California if they're unhappy, which is what Elon Musk did when he moved SpaceX and Tesla to Texas. However, Musk claims he did it because he was angry over gender identity laws. The ballot measure must still collect signatures before it can be up for a vote.
The Journal noted that Google co-founder Sergey Brin left California for Florida and Lake Tahoe, Nevada. He also moved several LLCs to Nevada.
Far-right Palantir co-founder Peter Thiel suggested he might do the same.
The Journal claims that such threats from billionaires might be enough to convince California voters not to tax the ultrawealthy.
The Investment Migration Council wrote on its websitethat "tax avoidance is the main reason actor Yul Brynner, entrepreneur Eduardo Saverin and inventor Earl Tupper abandoned U.S. citizenship."
One of the biggest arguments Democrats made in 2022 was for adding more workers to the Internal Revenue Service (IRS) to focus on tax evasion by the wealthiest Americans, which costs the U.S. approximately $150 billion each year, CNBC reported.
The Journal expects that billionaire tax evasion will likely become a more significant issue as the U.S. economy continues to slump and the wealth gap grows.
Since 1990, the WSJ has reported that the top 0.1 percent of wage earners now hold a much larger share of U.S. wealth. In the past 26 years, it has grown 14.4 percent for them.
"Meanwhile, the bottom half of American households have lost ground. Their 2.5 percent cut of the country’s wealth has slipped from 3.5 percent in 1990," the report said.
---