Californians reject Prop 40, the billionaire tax tech elites spent millions trying to stop

Californians reject Prop 40, the billionaire tax tech elites spent millions trying to stop Sergey Brin, seen here attending a tech summit with other founders and CEOs, was one of the billionaires who poured millions into a campaign opposing the 5% wealth tax. Kent NISHIMURA / AFP via Getty Images California's 200-plus billionaires are officially in the clear.The latest episode of "How to Tax a Billionaire: California Edition" — featuring plenty of drama, tech celebrities, and a big pot of money at stake — ended with a failed vote on Monday.Californians who went to the polls rejected Proposition 40, which would have imposed a one-time "5% tax on certain taxpayers with assets over $1 billion."The tax would've been levied against billionaires living in the state as of January 1, 2026, which included 214 people, according to Forbes data compiled by Americans for Tax Fairness, a group that advocates for higher taxes.The controversial measure had sparked a showdown with Silicon Valley executives.Google cofounder Sergey Brin, former Google CEO Eric Schmidt, Affirm CEO Max Levchin, Stripe CEO Patrick Collison, DoorDash CEO Tony Xu, Kleiner Perkins Chairman John Doerr, and angel investor Chris Larsen collectively poured millions into an opposition campaign. Brin himself donated more than $100 million, per CalMatters.State campaign-finance filings showed committees opposing Prop. 40 had reported about $130 million in contributions through October 22, versus about $33 million for its supporters.Meanwhile, tech executives were preparing for the possibility that they'd be asked to pay up.Brin and fellow Google cofounder Larry Page moved entities tied to them out of California in December, Business Insider first reported. Meta CEO Mark Zuckerberg weighed moving out of the state. In October, the company announced it was creating a new class of shares that would give Zuckerberg $20 billion in "immediate liquidity," potentially allowing him to pay the tax without giving up some of his voting power.But not every billionaire was fazed."I've got to tell you, I have not even thought about it once," Jensen Huang, CEO of Nvidia, said during a January spot on Bloomberg TV. "We chose to live in Silicon Valley, and whatever taxes they would like to apply, so be it. I'm perfectly fine with it."The vote also split some regular political alliances. Progressive Vermont Sen. Bernie Sanders backed the proposed billionaire tax, while California's Democratic governor, Gavin Newsom, opposed the measure.There were multiple paths to "No"Voters were asked to vote "Yes" or "No" on Prop. 40, but there were additional measures that could've negated a "Yes" vote.Props. 41 and 42 were designed to undercut Prop. 40 by imposing new restrictions on state taxes.Even if voters had voted in favor of Prop. 40, the billionaire tax could still have been blocked if either measure received a higher number of "Yes" votes.Billions of dollars were on the lineUnder the measure, taxable wealth would've included ownership stakes in businesses, securities, investment accounts, art, collectibles, and intellectual property, among other assets. Real estate, pensions, and retirement accounts would generally be excluded.The tax would've been due in 2027, though taxpayers could've spread out their payments across five years at a higher cost.Supporters said the measure would've raised over $100 billion for the state. A majority of the proceeds from the tax were to be allocated to healthcare, as well as education, food assistance, and the operation of the tax program. Backers pitched the measure as a way to help backfill looming federal cuts to Medi-Cal.A National Bureau of Economic Research working paper from Stanford economists, published in October, warned that the results could be much less rosy. The paper said the initial tax event could bring in around $30 billion, but that by prompting high-earning executives to leave the state it could result in a net loss of $38.9 billion. Read next Business Insider tells the innovative stories you want to know Business Insider tells the innovative stories you want to know Business Insider tells the innovative stories you want to know Business Insider tells the innovative stories you want to know Kelsey Vlamis is a senior reporter for Business Insider, where she covers business and tech news. She also writes business stories about travel, luxury, and culture. Previously, she covered the environment, outdoors, and indigenous issues.Her feature story "Disaster at 18,200 feet" received awards from the New York Press Club and the North American Travel Journalists Association, as well as honorable mention from the Society of American Travel Writers. She has also received an American Journalism Online Award for her coverage on missing and murdered Indigenous people in Wyoming.She's appeared on CBS, NPR, NBC, and other outlets to discuss her reporting. She previously worked on the world news desk at the BBC in London and received a master's in journalism from Northwestern University.She can be reached by email at kvlamis@businessinsider.com or via the encrypted-messaging app Signal at kelseyv.21. Ben Shimkus is a reporter for the Business News desk. He writes about cars, transportation, retail, and jobs. Ben's reporting has appeared in Rolling Stone, The Verge, Automotive News, USA Today, AutoBody News, LGBTQ Nation, TopSpeed, and Out Magazine. He's also held staff writing positions at The U.S. Sun and the Daily Mail. He graduated from NYU with a Master's in journalism in 2024. Email Ben at bshimkus@insider.com or message him privately on Signal at bshimkus.41. Billionaires