Los Angeles (United States) (AFP) – A proposal to levy a one-off tax on billionaires in California appeared to be headed for defeat Wednesday in a vote being watched around the world at a time of growing anger over wealth disparity. So-called Proposition 40 would force around 200 billionaires in the state to cough up five percent of their total net worth, with the money largely dedicated to helping pay for healthcare. But with about 60 percent of votes counted, “No” was leading by 55.6 percent to 44.4 percent, data showed. An analysis by the San Francisco Chronicle looking at how the outstanding votes were expected to fall determined the result was unlikely to change.
Prop 40 was one of a bevy of proposals put to voters in Tuesday’s midterm elections, which delivered large-scale victories across the nation for the Democratic Party and handed a drubbing to President Donald Trump’s Republicans. With the highest population of any US state, California is notoriously slow at counting votes, but a number of propositions and many elected positions — including governor — have already been decided. The proposal was unveiled to fanfare in California, a state that would be the world’s fourth largest economy if it were a country, but one in which there is a yawning gulf between the haves and the have-nots. It was seen by wealth tax proponents as a key part of a global effort to tackle growing income inequality.
“Significant changes rarely move in a straight line,” Nobel Prize-winning economist Joseph E. Stiglitz said in a statement sent to AFP by the International Capital Tax Commission. “Prop 40 put a tax on billionaire wealth on the ballot in the United States for the first time,” he added. Advocates calculated the one-off tax would raise about $100 billion, which would be used to fund a public healthcare system that has been hit by Trump’s budget cuts. Opponents of the ballot measure, including Google co-founder Sergey Brin, raised hundreds of millions of dollars to defeat the idea, arguing it would push the wealthy to leave California.
“No” campaign commercials warning about the loss of future tax revenues if billionaires desert the state played wall-to-wall across TV stations in California in the run-up to the vote. Outgoing Governor Gavin Newsom, who is widely expected to make a run for the White House in 2028, said he would vote no. United Domestic Workers, a union representing 250,000 home care and childcare providers, also urged its members to vote against, arguing that the one-time tax was no way to plug multi-billion dollar holes in the state’s budget. California has previously voted three times this decade on a wealth tax, rejecting it every time. While the measure was popular when it was first launched, it lost steam quickly once the “No” campaign kicked into high gear, warning voters it would result in raids on their own more modest savings.
© 2024 AFP
