Ballot proposes one-time, 5% tax on anyone in state worth more than $1bn and grant a five-year period for payment
Palantir co-founder Peter Thiel has donated $3m to a California lobbying group advocating against a proposed wealth tax that would target billionaires in the state. The seven-figure contribution comes as several ultra-wealthy tech moguls have left or threatened to leave California over the tax.
Thiel, worth some $26bn, made the donation last month to the California Business Roundtable’s political action committee, according to a public disclosure filing which was first reported by the New York Times. A representative for Thiel did not respond to requests for comment.
The ballot proposal, called 2026 Billionaire Tax Act, is still in the beginning stages of gathering the 900,000 signatures needed for it to go to voters in November. If voted into law, it would levy a one-time, 5% tax on anyone in the state worth more than $1bn and grant a five-year period for payment. Thiel would owe the state roughly $1.3bn based on his current net worth.
Thiel’s contribution to the California Business Roundtable Pac is an early signal of how California’s tech elite may mobilize their immense resources to quash the proposed tax. As the proposal gains prominence, it has already become a fixation for some of the state’s wealthiest residents, who see an impending threat to their vast fortunes.
The proposal has driven opposition from a number of big-name tech billionaires, including Google co-founders Larry Page and Sergey Brin. Both men, worth upwards of $250bn each, have shifted assets to other states in recent months, according to the New York Times, while the Wall Street Journal reported that Page recently spent about $173m to purchase two Miami homes. Other tech billionaires, especially members of the tech-right such as Tesla CEO, Elon Musk, and Palantir co-founder, Joe Lonsdale, have egged on their peers to leave the state.
Thiel has also made recent moves to relocate some of his empire from California, with his Thiel Capital private investment firm announcing last year that it had opened a Miami office. His donation to the California Business Roundtable also lists Miami as his location. Thiel has a history of bankrolling conservative causes, including $1m for Donald Trump’s first campaign, and has given millions to anti-tax groups and candidates in past years.
Advocates for the tax, including the Service Employees International Union, contend that the revenue would prevent the collapse of California’s healthcare system and fund the state’s public education programs. The tax would only affect approximately 200 people in the state, according to the union.
The proposed ballot measure has also proven politically divisive among elected Democrats, with Governor Gavin Newsom vowing to “fight” it and claiming that it would hurt the state’s ability to be economically competitive. California representative Ro Khanna, meanwhile, has backed the act.
The lobby group involved in fighting the proposal described it as a “dangerous wealth tax” in a statement to the Guardian, alleging it would force investment out of the state.
“The California Business Roundtable will continue to be actively engaged in ballot measures that affect the business community and the cost of living for all Californians,” Rob Lapsley, president of the Roundtable, said. “That includes opposing proposals like a dangerous wealth tax that would undermine our economy, decimate the state budget, drive investment out of the state, and ultimately make everyday life more expensive for working families.”
While a number of billionaires have spoken out against the tax, Nvidia’s CEO, Jensen Huang, recently told Bloomberg Television that he had no problem with it. Huang, who is worth around $159bn, argued that he was “perfectly fine” with the proposal and claimed he hadn’t “even thought about it once”.
