Billionaire Tom Steyer has publicly endorsed a proposed one-time 5% tax on the wealthiest residents of California, a move that has intensified a debate among top Democrats and the affluent tech community in Silicon Valley. As Steyer campaigns for the California governorship, he stated that he would support the tax if it appears on the November ballot, although he raised concerns about the specifics of the proposal.
In a statement on his Substack, Steyer described the tax as a “temporary fix to a permanent, structural problem” stemming from cuts made to Medi-Cal during the Trump administration. He emphasized, “If there’s an opportunity to tax wealthy people to fund health care and education, I’d vote for it all day long.”
The proposal has divided Democratic leaders, with Governor Gavin Newsom and gubernatorial candidate Katie Porter opposing it, while figures like Vermont Senator Bernie Sanders and Representative Ro Khanna have voiced support. Should the measure pass, it could result in a tax bill exceeding $237 million for Steyer, based on his net worth of $4.75 billion.
However, the plan is not yet a reality; its proponents must collect nearly 900,000 signatures to qualify for the ballot. State analysis indicates that while the tax could generate significant revenue, it may also lead to long-term financial losses if wealthy individuals decide to relocate out of California.
Steyer’s gubernatorial campaign centers on closing corporate tax loopholes and criticizing wealth inequality. His previous presidential bid in 2020 included over $340 million in spending, which he ended following a disappointing performance in the South Carolina Democratic primary.
Why this story matters: The proposal could influence California’s wealth distribution and healthcare funding.
Key takeaway: Steyer’s support underscores the complex dynamics within the Democratic Party regarding wealth taxation.
Opposing viewpoint: Critics argue the tax could drive billionaires out of the state, harming long-term revenue.
