Proposition 42
Ban new taxes on personal property
Proposition 42 is meant to make it much harder to create a wealth tax in California by prohibiting new taxes on the mere ownership of assets such as investment accounts, business interests and personal property — assets that are typically only taxed when they are sold or generate income. Like Proposition 41, which also attempts to block Proposition 40 (a wealth tax on billionaires), Proposition 42 would nullify Proposition 40 if it receives more votes, even if the billionaire tax also passes.
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Summary
Support
The measure’s ultra-wealthy backers say California should not tax people for merely owning or controlling retirement accounts, financial portfolios, or valuable personal possessions like art. They want to prevent taxes on unrealized gains — paper wealth that hasn’t been sold or generated taxable revenue — warning that pensions and retirement accounts could one day be taxed on their future value.
Oppose
The chief opponent is SEIU-United Healthcare Workers West, which is the sponsor of Prop. 40. The union argues that Prop. 42 is designed to trick voters into making it impossible to apply a wealth tax to billionaires. Prop. 42 isn’t about preventing new taxes on everyday people, the union says; instead, it’s a way for billionaires to avoid paying a one-time tax on their huge wealth.
People and organizations
Support
- Reform California
- Building a Better California
- Google co-founder Sergey Brin
Oppose
- SEIU-United Healthcare Workers West
