Proposed 'billionaire tax' in California spurs controversy and heavy spending

About 90% would go toward healthcare, which has had steep federal funding cuts.

California is considering a one-time 5% tax on the wealth of billionaires. SEIU-UHW, a healthcare workers union, recently submitted the signatures required to put the tax to a vote as a ballot measure in November. California Gov. Gavin Newsom opposes the tax.

In a May 5 debate, all the candidates running for California governor but one, Tom Steyer, voiced opposition. Steyer later told Wired that the tax “doesn’t go far enough,” though he also emphasized that he wants California to be “where the companies that are changing the world are begun and grow and stay.”

Brian Brokaw, a longtime Newsom adviser who leads Stop the Squeeze, a group opposing the tax, told ABC News that the measure could financially devastate the state.

“We're not just talking about individual billionaires. You're talking about an entire economy that is the backbone of California's economic engine,” he said.

The tax was introduced in response to steep cuts to California’s healthcare funding that resulted from the passage of the President Donald Trump's “Big Beautiful Bill.” According to SEIU-UHW, the tax would generate around $100 billion over five years, funneling 90% of those revenues toward the healthcare sector.

Suzanne Jimenez, chief of staff at SEIU-UHW and one of the architects of the measure, warned of a “complete collapse” of the healthcare system in California if funding shortfalls go unaddressed.

SEIU-UHW, along with its associated political groups, has contributed more than $31 million to a proxy called Save California Healthcare and Public Education Committee to support the initiative.

The most well-resourced organization opposing the measure is Building a Better California, which supports committees promoting two competing ballot initiatives that purport to improve government transparency and to protect retirement savings from taxes, respectively. If either of those ballot initiatives receives more votes than the billionaire tax measure, the group will negate it.

Building a Better California has raised more $118 million from 10 donors. More than half of that money comes from Google co-founder Sergey Brin.

“We are solely focused on passing our measure,” a spokesperson for the group promoting the retirement savings initiative told ABC News.

Shana Kushner Gadarian, a professor at Syracuse University who studies political psychology, thinks the alternative ballot measures may have been crafted to oppose the tax without appearing to support billionaires over healthcare workers.

“My gues