California could impose a billionaire tax. Here's how it would work.

Main Idea: California is weighing a ballot measure backed by a union that would impose a one-time 5% tax on the wealth of the state’s billionaires to help pay for health care, education, and food aid.

Key Points:

• The proposal would tax billionaires’ wealth, not their income, and would apply to assets like stocks and business holdings, while excluding some items such as real estate and certain retirement accounts.
• If approved, the tax would be paid in 2027, with an option to spread payments over five years for an added charge.
• Supporters say the tax would help offset big federal cuts to Medicaid and raise tens of billions of dollars for public programs.
• Critics, including Gov. Gavin Newsom, argue the plan could push wealthy residents out of California and hurt the state’s tax base.