Tech billionaires invest $120 million to oppose California tax.
In summary, tech billionaires have invested over $120 million to oppose California’s Proposition 40, a proposed one-time 5% wealth tax on billionaires that will be on the ballot in November, compared to $31 million raised by union supporters. Sergey Brin is the largest contributor, donating $82 million and relocating assets outside of California; other contributors include Doerr, Moritz, Collison, Schmidt, Larsen, Thiel, and more. Donation amounts are sourced from campaign filings reported by Business Insider.
Silicon Valley’s wealthiest individuals are heavily funding the campaign against California's proposed billionaire tax, as indicated by Business Insider's compilation of campaign filings. They have invested more than $120 million to defeat or weaken the measure, approximately four times the $31 million raised by its union supporters.
Proposition 40 aims to implement a one-time 5% tax on individuals and trusts with a net worth exceeding $1 billion when Californians cast their votes in November. The sponsor, SEIU-UHW, claims that the funds generated from the tax on about 200 billionaires in the state would support healthcare, food assistance, and education, with expectations of $100 billion in revenue.
The opposition's largest donor is Google co-founder Sergey Brin, who has contributed $82 million to a committee called Building a Better California, which includes a $16 million donation made on May 15, according to Business Insider, just weeks before the ballot deadline. Brin, reportedly the world's third-richest individual with a net worth of $280 billion according to Bloomberg's index, has moved numerous LLCs out of California prior to a crucial January deadline. He has equated the tax to Soviet-style socialism and expressed his desire for California not to reach a similar situation to the country his family escaped.
John Doerr, chairman of Kleiner Perkins and the second-largest donor, has contributed $10 million. Former Sequoia Capital leader Michael Moritz has given $7.5 million, while Patrick Collison, CEO of Stripe, donated $7 million, as reported in the filings referenced by Business Insider.
Former Google CEO Eric Schmidt was one of the earliest backers after Brin, donating just over $3 million. Chris Larsen, executive chairman of Ripple, contributed $2.5 million along with an additional $5 million to a different opposition group that Ripple matched. The list continues with donations from Stewart Resnick of Wonderful Company ($2.5 million), DoorDash CEO Tony Xu ($2 million), Affirm's Max Levchin ($1 million), and Wicklow Capital's Daniel Tierny ($500,000). Angel investor Ron Conway donated $100,000 to another group after unsuccessful attempts to convince Governor Gavin Newsom to arrange a compromise to keep the measure off the ballot.
In relation to artificial intelligence (AI), Peter Thiel, whose Founders Fund recently gathered $6 billion for AI investments, took a different approach by donating $3 million in December to the political arm of the California Business Roundtable, with reports indicating he is spending more time in Argentina.
The opposition reflects the ongoing AI boom that has significantly increased the wealth now at risk, with Brin still pivotal to Alphabet’s AI initiatives. Building a Better California has also proposed competing ballot measures aimed at lessening the impact of the tax if it passes.
Supporters assert that billionaires, who have benefited at least partially from public funds, can afford a one-time tax to help restore depleted health budgets. Conversely, opponents caution against potential capital flight, market disruptions, and prolonged legal battles, as evidenced by Brin’s pre-deadline LLC relocations indicating that such flight might already be commencing.
This elite group in tech, accustomed to retreats on Necker Island rather than political battles over ballot measures, will have to wait until November to find out if their $120 million effort can secure a majority.
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Tech billionaires invest $120 million to oppose California tax.
Sergey Brin has invested $82 million in opposing California's 5% billionaire tax, spearheading a campaign among tech elites that surpasses the funding of the measure's union supporters by four times.