Proposition 42
Ban new taxes on personal property
Proposition 42 would 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. It was placed on the ballot by opponents of the proposed billionaire tax.
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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.
Endorsements
Support
- Reform California
- Building a Better California
- Google co-founder Sergey Brin
- Peace Officers Research Association of California
- California Professional Firefighters
- State Building and Construction Trades Council of California
Oppose
- SEIU-United Healthcare Workers West
- California Democratic Party
Media endorsements
Commentary
Campaign finance
Proposition committees raise money to support or oppose propositions. Outside groups can also raise and spend money independently to influence outcomes.
- Proposition committees
- Outside spending
- Difference to other side
Support
Oppose
Proposition committees
These committees are primarily formed to campaign for or against a proposition. They must identify contributors who give $100 or more, or loan a committee money. There are no limits on how much contributors can give or loan. Contributors who had their loans repaid or forgiven are still included. We exclude contributors who gave less than $100 in total. Contributors who made loans as part or all of their total are identified with an asterisk (*).
For funding by industry, we used existing sources, traditional machine learning and large language models to help categorize contributors who gave $5,000 or more in total, with CalMatters journalists reviewing the results. We also categorized the donors of political action committees that contributed to a campaign and used the results to calculate which industries should be applied. Major donors include individuals who self-identified as retired, self-employed, unemployed, a homemaker or a student.
Support
Oppose
Outside spending
Separate from proposition committees, outside groups can pay for ads, mailers and other efforts to influence voters. They can’t coordinate that spending with proposition committees. There is no limit on how much they can spend.
Support
Oppose
Video
Ballot text
PROHIBITS NEW STATE PERSONAL PROPERTY TAXES AND CERTAIN RETROACTIVE STATE TAXES. INITIATIVE CONSTITUTIONAL AMENDMENT. Prohibits any new state tax (1) imposed on the ownership of personal property (all things people own other than real estate), or (2) that applies retroactively based on taxpayer’s past activities. Nullifies taxes enacted after January 1, 2026 that conflict with this measure. Fiscal Impact: Possibility that tax revenues will not go up as much in the future.
Source: California Secretary of State
