![\"Dr.](\"https:\/\/www.newsbeep.com\/us-ca\/wp-content\/uploads\/2026\/03\/SAC_00022_PK_20250513_MEDICAID.JPG\" "\\"Dr.")
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Dr. Kimberly Buss speaks at a \u201cSave Our Hospitals\u201d rally last year ahead of the passage of the Republican megabill that included cuts to Medicaid. Backers of a proposed Billionaire tax say it will help blunt the severity of the bill\u2019s affects on California health care. <\/p>\n
PAUL KITAGAKI JR.<\/p>\n
pkitagaki@sacbee.com<\/p>\n
A one-time tax on California\u2019s billionaires could bring the state a $100 billion windfall, staving off brutal cuts to healthcare services across the state caused by the 2025 Republican megabill.<\/p>\n
Or it could result in a net loss in tax revenue as billionaires flee the state, endangering the state\u2019s long-term fiscal health.<\/p>\n
The high-stake scenarios are laid out in two dueling analyses of the proposed billionaire tax, a measure sponsored by Service Employees International Union\u2013United Healthcare Workers West that\u2019s currently gathering signatures to appear on the ballot this November. The initiative levies a 5% one-time tax on California billionaires, with 90% of the revenue going to fund health care services affected by the 2025 megabill.<\/p>\n
Without action, backers of the initiative warn millions of Californians could lose health insurance and dozens of hospitals and ERs could close.<\/p>\n
The initiative is controversial. Gov. Gavin Newsom and most of the candidates to succeed him oppose the measure; a UC Berkeley poll released last week<\/a> found 52% of likely voters support it. Billionaires like Google co-founder Sergey Brin have poured tens of millions into efforts to stop the tax, and some, like Meta CEO Mark Zuckerberg, have reportedly bought new homes<\/a> or moved assets to other states<\/a>.<\/p>\n The latest findings are likely to add fuel to both sides of the debate.<\/p>\n The more optimistic study<\/a> comes from a team of three tax attorneys and one economist from UC Berkeley, UC Davis and the University of Missouri who developed the structure of the tax proposal. They argue that because the tax applies to billionaires who were California residents as of Jan. 1, few will be able to outrun the tax. Their analysis also posits that most of the billionaires are likely to stick around in the long run because the tax is a one-time hit.<\/p>\n Another analysis<\/a>, from a team at the right-leaning Hoover Institute, argues the tax\u2019s backers overstate which billionaires are still California residents and how much of their holdings are actually subject to the tax. Using models developed from wealth taxes in Europe, they estimate the tax will generate $40 billion and drive many in the group out of the state in the longer-term, meaning the proposal will actually lose money for the state in the long run.<\/p>\n The wealth tax backers have attacked the Hoover Institute\u2019s motives. David Gamage, a law professor at the University of Missouri who helped write the ballot measure, called the Hoover research a \u201cbad faith analysis\u201d in an interview. He argued the researchers assume perpetual billionaire departures even though the wealth tax is a one-time measure.<\/p>\n Will billionaires flee California for good?<\/p>\n Gamage argued the warnings of mass exodus following Massachusetts\u2019 2022 millionaires\u2019 tax and Washington\u2019s 2021 capital gains tax hadn\u2019t been borne out.<\/p>\n \u201cBoth of those taxes raised more revenue than predicted,\u201d Gamage said.<\/p>\n Benjamin Robert Jaros, an economist at the Hoover Institute, stood by the institution\u2019s research on the California measure, arguing it was tightly modeled to existing research on the topic.<\/p>\n \u201cUltimately, what drives departures is not whether the tax is one-time on paper, but whether billionaires believe it will be levied again, and if it passes, they almost certainly will think so,\u201d Jaros said in an email.<\/p>\n Gamage urged another academic \u2014 Jeff Hoopes, a professor at the University of North Carolina who specializes in how people respond to tax law \u2014 to review both studies. Hoopes\u2019 paper, published last week<\/a>, noted that the wealth tax backers used a more simple methodology for calculating tax revenue, while the Hoover Institute went more in the weeds.<\/p>\n In an interview, Hoopes, who described himself as a wealth tax skeptic, agreed with Jaros that the tax would encourage billionaires to leave.<\/p>\n He said one key variable was the legal questions surrounding what constituted residency, which could be an especially thorny question for jet-setting billionaires.<\/p>\n \u201cIt\u2019s not like they\u2019re going to start putting things in cardboard boxes, put them in their U-Haul and drive across the state line to Arizona,\u201d Hoopes said. \u201cThese people have houses everywhere. And it\u2019s a legal matter of documenting their association with California.\u201d<\/p>\n Related Stories from Sacramento Bee<\/p>\n
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