California wealth tax could trigger mass exits of entrepreneurs

Proposition 40 would impose a 5% net-worth tax on California billionaires (with payments starting in 2027), a move critics say could spur a mass relocation of entrepreneurs, harming jobs and investment even as nonpartisan analysts note potential revenue gains. Supporters include Democrats; critics, including Gov. Newsom, warn of broader economic damage. The LAO estimates some loss of income tax revenue if wealthy leave, but the measure could raise tens of billions in wealth taxes over time.