RE: LeoThread 2026-01-14 19-48

Analysis of California’s “One-Time” Billionaire Tax — it’s worse than it appears

📉 Will it pass? Likely yes

It needs just 50%+1 voter approval. SEIU + CTA have done this before—Prop 55 won 63% in 2016

⚖️ Will it get tied up in litigation?

Almost certainly. A retroactive wealth tax of a type CA has never had would raise due process challenges. Wealthy taxpayers have the legal budgets for years of fights

👋 This is clearly only the start. The goal is an annual tax, not a one-time levy, and the target is $25M–$50M net worth households, including illiquid holdings like early-stage founders pre-Series B

The “one-time” framing is strategic, not final

The same coalition already has AB 259 drafted—an annual 1% wealth tax at a $50M threshold, with plans to lower to $25M. It’s been introduced three years running

Removing the constitutional barrier with a one-time tax would make an annual version a much easier ballot measure

🔃 CA Policy Center warned: “If SEIU hopes to keep Medi‑Cal spending growing, it may need to place repeated wealth taxes on the ballot—potentially lowering the threshold as billionaires flee”

The real risk for founders:

At $1B, about 200 people would be taxed. At $50M, roughly 23,000 households would be affected—including many successful founders on paper before any liquidity event

The rational move may be to relocate or avoid incorporating in CA before approaching those thresholds

✈️ Net-net: relocating before the Series B could make sense

As one prominent investor put it: “Even people who don’t expect this initiative to pass are still planning to leave because there will be another one”

The one-time tax is a constitutional Trojan horse; the annual tax—at a much lower threshold—is already waiting inside