PROP
40

IMPOSES ONE-TIME TAX ON CERTAIN TAXPAYERS. INITIATIVE CONSTITUTIONAL AMENDMENT AND STATUTE.

 

OFFICIAL TITLE AND SUMMARY

PREPARED BY THE ATTORNEY GENERAL

  • Imposes one-time tax of up to 5% on certain taxpayers with covered assets valued over $1 billion; covered assets include businesses, securities, art, collectibles, and intellectual property, but exclude real property and some pensions and retirement accounts.
  • Allocates 90% of these tax revenues for health care, 10% for food assistance or education-related programs; prohibits using revenues to replace existing funding for these purposes.
  • Exempts such tax revenues from constitutional requirements for school funding, budget reserves, and state spending limit.

SUMMARY OF LEGISLATIVE ANALYST'S ESTIMATE OF NET STATE AND LOCAL GOVERNMENT FISCAL IMPACT:

  • Temporary state revenue increase from a new wealth tax on billionaires. These wealth tax revenues probably would add up to tens of billions of dollars spread over several years.
  • Possible ongoing decrease of less than $1 billion per year in state income tax revenue collected from billionaires.