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Relocation threats shouldn’t stop California from taxing billionaires

As a California millionaire, I have no problem paying more in tax if it means millions of my neighbors get to keep their health care coverage. I am proud to pay higher taxes if it makes for a healthier and safer nation. I also won’t leave my beloved home state of 30 years if that happens.

It is a pity that some of my billionaire peers don’t feel the same about their civic responsibility and patriotic duty.

Last October, organizers filed a measure, the 2026 Billionaire Tax Act, to appear on the November 2026 ballot. If passed, this initiative would enact a one-time, 5 percent tax on the net worth of billionaires living in California as of Jan. 1, 2026. An estimated 200 billionaires would be liable to pay the tax. It would raise about $100 billion in revenue, 90 percent of which would be directed to health care.

Opponents of the wealth tax were quick to slam the initiative. A number of billionaires publicly threatened to relocate on account of the tax, like Google cofounders Larry Page and Sergey Brin and Palantir cofounder Peter Thiel.

Gov. Gavin Newsom (D) and many of the current candidates competing to replace him as governor have also come to their defense, bemoaning the stifling of innovation and long-term loss of tax revenue a Golden State billionaire exodus would cause. One detractor, Derik Kauffman, went so far as to organize a march in support of billionaires. 

The wealth of America’s billionaires has climbed to almost inconceivable heights in recent years. And although they may be smart and talented, this is largely because they are not paying their fair share in federal, state, or local taxes right now. 

Berkeley Professor Emmanuel Saez estimates that California’s roughly 200 billionaires collectively pay between $3 billion and $4 billion in state income taxes each year. That might seem like a lot, but it’s not really, considering that it’s only 0.2 percent of their total collective wealth. Let’s also not forget that they and the rest of the rich in America got another massive tax break with Republicans’ so-called “One Big Beautiful Bill” last summer.

The 2026 Billionaire Tax Act would go a long way in helping California billionaires finally start paying their fair share in taxes back into the public systems — the schools, roads, courts and more — that allowed them to get so incredibly wealthy in the first place.

While we should not dismiss the idea that some rich people may leave if such a tax is enacted, we should not allow those few individuals to hold the state hostage to their tax preferences. Especially because the evidence we have available today suggests that wealthy people do not move in droves when lawmakers raise their taxes. 

In his 2017 book, “The Myth of Millionaire Tax Flight: How Place Still Matters for the Rich,” Cornell University Professor Cristobal Young found that just 2.4 percent of millionaires in America move to a different state every year — compared to 2.9 percent for the general population. He explains that millionaires are more rooted to their home bases because their financial success is intimately embedded within their communities given their powerful social and business connections.  

More recent research corroborates Young’s findings. In December 2023, the Fiscal Policy Institute reported that the millionaire population in New York state had grown after tax hikes were instituted in 2017 and 2021. After Proposition 30 went into effect California, state revenues increased by $7 billion-$8 billion per year, according to the California Budget & Policy Center  — a sure sign the tax didn’t empty the state of millionaires. More recently, the Institute for Policy Studies found the same when they studied the number of millionaires in Washington and Massachusetts after they passed tax hikes on the rich in 2022. 

But even if billionaires do flee California in an attempt to avoid the tax, they will not be successful. That’s because the initiative would enact the one-time tax on their net worth in 2025. In other words, so long as they were living in California on Jan 1, 2026, they’re paying it.  

Those of us who have W-2 income and capital gains pay a lot of tax to make for a healthier, safer and well-educated California, as we should. It is the fair thing to do. The billionaires have to start paying their fair share too. We can no longer allow them to exploit tax loopholes that let their wealth grow to oligarchic levels while they benefit from public goods and services. 

Despite what the public whining from a few of them may suggest, if the initiative passes and they have to pay the tax, they will be absolutely fine, especially compared to the 7 million Californians who live in poverty. 

It is time California residents and lawmakers stand up and break free from the grip billionaires have on our tax policy. We can no longer let them dictate what is a reasonable tax policy when it comes to funding social and public services they rely on. 

Maureen Kennedy is a member of Patriotic Millionaires and former deputy assistant secretary for policy at the Department of Housing and Urban Development during the Clinton administration. She also ran the Farmer’s Home Administration and was a real estate broker in the East Bay Hills.

Copyright 2026 Nexstar Media Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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