California Billionaire Tax Too Close to Call as Top Rates Approved

California’s proposed Proposition 40, a one-time 5% tax on billionaires intended largely to offset healthcare cuts, remained too close to call as ballots were counted, with early returns favoring opponents. Supporters, including Bernie Sanders and labor groups, said it would protect public services and address wealth inequality, while Gov. Gavin Newsom and business groups warned the tax could drive wealthy residents away; opponents significantly outspent supporters. A competing measure could invalidate Proposition 40 if it receives more votes. Voters separately approved Proposition 3, making permanent higher income-tax rates on top earners that generate billions annually for schools and other programs. The debates unfolded amid a midterm contest over affordability, inequality and money’s influence in politics, with spending on track to approach a record $12 billion, and broader concern over whether Californians will share in gains from the technology and AI boom.