California Gov. Gavin Newsom and his hair gel has not yet announced that he is running for president in 2028, but with this move, he might as well admit it. The governor recently indicated that he opposes levying a one-time five percent tax on billionaires.
This could be yet another indication that Newsom is trying to move to the center to portray himself as a more reasonable candidate in 2028 rather than a far-left ideologue.
From The New York Post:
Dan Newman, a political adviser opposing the campaign to tax billionaires, said Newsom is against a plan to slap a one-time, 5% tax on roughly 200 Californians worth more than $1 billion to “replace lost federal dollars and protect essential services,” as described by the campaign’s website.
If enacted, tech titans like Meta CEO Mark Zuckerberg and Nvidia’s Jensen Huang could see colossal tax bills running in the billions. Five percent of Huang’s estimated net worth is equivalent to roughly $8 billion, and Zuck’s tax bill could total more than $12 billion.
The revenues are intended to fund health care services and the state’s struggling school system, according to supporters.
Backers of the billionaire tax, who include the SEIU United Healthcare Workers West, Los Angeles nonprofit St. John’s Community Health and former US Secretary of Labor Robert Reich, claim it’s needed in light of federal funding cuts to Medi-Cal and other health care programs.
The governor’s opposition is a blow to progressives and labor interests backing the tax plan, which could raise some $100 billion over five years, according to supporters. Opponents of the tax say it could drive wealthy residents out of California, ultimately worsening the state’s colossal budget deficit.
Gov. @GavinNewsom says he disagrees with Mayor @ZohranKMamdani about the need for a wealth tax on billionaires, which he is “adamantly against” - says Dems are a “big tent party” with both views.
— The Tennessee Holler (@TheTNHoller) December 4, 2025
More on the CA proposal: https://t.co/D3SWI7SPJw pic.twitter.com/Ko5bVFGncT
California’s progressive left is not going to be happy about this. But many have warned that such a move might prompt wealthy residents to flee the state as so many others have done over the past decade. The top one percent of earners already pay 39 percent of the state’s tax revenue.
The measure would apply to a sweeping variety of assets.
The measure applies the tax to virtually all asset classes. Publicly traded securities, private company equity, business interests, trusts, art, collectibles, and intellectual property all fall within scope. Real property held directly by taxpayers or through revocable trusts receives an exemption.
Business valuations would use book value plus 7.5 times average annual profits over three years. Taxpayers could contest these figures through certified appraisals demonstrating clear and convincing evidence of different values.
Penalties for substantial understatement reach 20% of underpaid amounts. Gross understatement penalties climb to 40%. An understatement qualifies as substantial when exceeding $1 million or 20% of the tax shown on returns.
Newsom previously described the idea as “bad policy” and “another attempt to grab money for special purposes.”