Name: Tech leaders push back on proposed billionaire tax in California
Uploaded: 2025-12-30T21:19:41.837Z
Duration: 4 min 33 s
Description: A proposed tax on California billionaires is prompting pushback from tech leaders. CBS News senior business and tech correspondent Jo Ling Kent has more.

A proposed tax on California billionaires is prompting pushback from tech leaders. CBS News senior business and tech correspondent Jo Ling Kent has more.

A proposed ballot measure in California aims to tax residents with assets over $1 billion at a rate of 5%, with the goal of addressing a projected shortfall in the state's health care system. The measure, driven by a union and potentially appearing on the November ballot, has drawn intense criticism from Silicon Valley tech leaders and billionaires, who argue it could drive entrepreneurs and jobs out of the state.

Political figures have weighed in, with Representative Ro Khanna supporting the tax as a means to fund Medicaid, while Senator Ted Cruz and others warn it may push innovators to states like Texas. The debate has highlighted concerns about the state's economic competitiveness and broader questions about wealth inequality, innovation, and California's fiscal health.

Tech leaders push back on proposed billionaire tax in California

Welcome back. In California, a proposed ballot measure that would tax the wealthiest people in that state sparked some pretty intense backlash from a place that is rich in cash. We're talking about Silicon Valley. Supporters say the policy could generate billions of dollars and make up for an anticipated budget shortfall in the California health care system. However, big tech leaders and billionaires slammed the proposal, arguing it will drive entrepreneurs to just leave California. So let's talk about it live to CBS News senior business and technology correspondent Jolene Kent. Okay, Jolene, they're not getting into our pockets. But is it as easy as this to summarize that this is about taxing the rich in Silicon Valley? Read. This is a really fundamental question of how to solve a problem here in California when it comes to health care and affordable health care. And this is really this is a if there are enough signatures, and this does become a ballot initiative come November. This is driven by a union that is trying to make up what they call a gap in health care coverage and costs in the state of California. And the way it would work is California residents worth more than a billion dollars would be taxed. 5% of their assets would be taxed at a rate of 5%. And that could either be paid one time or it could be paid over five years. And it would retroactively, if passed, apply starting January 1st, which is in a couple of days. So the idea here is the reaction has been very strong and very controversial. If this goes through the question among the analysts and the experts and the sources I've been talking to, is it worth it to do this to have billionaires who may or may not actually leave the state of California? Or is it worth it? As in, you know, this is something that some folks believe, you know, billionaires should pay more taxes. And so it's a debate that has really sparked some, um, I don't know, Twitter wars read, right, right. And, you know, it's fascinating to me. We're not just talking about the Zuckerberg's and some of the other big luminaries in tech. If they leave the state of California, they have to take that very important workforce with them. People who are not anywhere near the millionaire or billionaire category. But we also know you're tracking some reaction from lawmakers. Democrat Representative Ro Khanna of California embraced the idea on social media. How are others responding to this? Yes, Representative Ro Khanna, who is obviously very active when it comes to tech regulation in Washington and is very much, you know, plugged into all of this. He had an interesting reaction. He said, you know, it's a matter of values. We believe billionaires can pay a modest wealth tax. So working class Californians have the Medicaid your party cut talking about the opposite party. And he is responding and saying, you know, Texas, for example, ranks near last in health care, education, funding and worker protections. But then you have other people weighing in. Senator Ted Cruz firing back and he's saying, please continue driving all the job creators out of California. He's referring to the fact that Texas has received a lot of, you know, big time players when it comes to innovators, founders, tech leaders. And he says Texans are enjoying the prosperity. Then you have a more moderate, I would say, reasonable voice in all of this. Alexis Ohanian of Reddit always weighing in with the more nuanced view, he says. He says we're absolutely going to have to figure out how our society adapts to a rapidly increasing wealth gap. It will be required to preserve a republic. But the answer, he says, Alexis Ohanian is definitely not taxing unrealized gains. So this is a debate that has both financial and economic impacts as well as innovation. And as we look to what is happening between the U. S. And China when it comes to the race and A. I. And tech innovation and even just small and large businesses doing business with each other. Where does this put California and the state of the United States, for example, vis a vis China and other competitors, economically around the world. So this may seem like a potential ballot initiative here in the state of California. But the debate it stirred up signals that it means so much more read. It does. And we're starting to hear from people in Texas about it. You know, I anchor a local broadcast originating out of San Francisco. And you know, when I talk about the tech sector, when I talk about school closings and education, when I talk about our Bay Area rapid transit system, there's one word that keeps coming up and it's deficit. Fascinating to see people look for solutions. We'll see if this one works in a ballot measure. Jolene Kent. Thank you so much.

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