California’s proposed wealth tax could cost top billionaires billions

According to Forbes’ calculations, based on net worth figures from October 27th, Meta CEO Mark Zuckerberg, currently the state’s wealthiest resident, could owe an estimated $10.9 billion. Nvidia CEO Jensen Huang, valued at over $170 billion, has publicly supported the tax, stating, “[He] doesn’t mind paying taxes” and calling it a “privilege.” Former Google CEO Eric Schmidt, with a net worth exceeding $30 billion, is among the tax’s most vocal opponents, having contributed approximately $40 million to a political action committee opposing the measure.

Other individuals potentially facing substantial tax liabilities include Broadcom cofounder Henry Samueli ($1.6 billion), Ubiquiti founder and CEO Robert Pera ($1.5 billion), Kingston Technology cofounders John Tu and David Sun ($1.4 billion each), OpenAI cofounder and president Greg Brockman ($1.3 billion), Figure CEO and founder Brett Adcock ($1.2 billion), and venture capitalist John Doerr ($1.1 billion). Doerr has also contributed around $40 million to oppose the tax.

While Forbes’ valuations are used for these estimates, discrepancies exist between Forbes’ methodology and the state’s calculation of net worth for tax purposes. Factors like assets held in trusts and valuation methods for private businesses could affect the final amounts paid.

A recent poll from UC Berkeley and the Los Angeles Times indicates a shift in voter sentiment, with 50% now planning to vote against the measure, compared to a narrow majority who favored it six weeks prior. Furthermore, other ballot propositions could potentially invalidate the wealth tax even if it passes.

The upcoming initial public offering (IPO) of Anthropic, an artificial intelligence company, could also impact the list of top taxpayers. Forbes currently values Anthropic cofounders and siblings Dario Amodei and Daniela Amodei at $13 billion each, potentially leading to a $680 million tax liability per person. However, the IPO could significantly increase their net worth, potentially exceeding $20 billion each and resulting in a tax bill of at least $1 billion per person.

Research from Stanford University suggests that the state could lose revenue due to billionaires leaving California, potentially offsetting the gains from the wealth tax. A study found that in most scenarios, the income tax lost from departing billionaires would exceed the revenue generated by the one-time tax.