|California lawmaker joins other blue states in attempt to tax the wealthiest |
California Assemblymember Alex Lee has put forward a plan that would impose new taxes on California’s “extremely wealthy,” at a rate of 1.5% on those worth more than $1bn starting next year, and at 1% for those worth more than $50m starting in 2026. The Democratic lawmaker says his plan would affect 0.1% of California households, and generate an additional $21.6bn in state revenue. On top of a person's annual income, the bill targets "worldwide wealth," or holdings such as stocks and hedge fund interest, farm assets, and arts and collectibles. The bill was announced as a joint effort alongside officials promoting similar wealth taxes targeting capital gains and “unrealized gains” in Connecticut, Hawaii, Illinois, Maryland, New York and Washington. The announcement was organized by the State Innovation Exchange, a progressive nonprofit, and the State Revenue Alliance, which works with labor groups to call for taxing rich people. “States are leaning into their power. They’re reminding us that states are the laboratories of democracy,” said Charles Khan, who serves on the advisory committee for the State Revenue Alliance. In California, similar wealth taxes in the past have faltered, with Democratic Gov. Gavin Newsom showing no signs of supporting them. California Taxpayers Assn. President Robert Gutierrez, also an opponent, said the state should not jeopardize losing its top earners at a time of economic uncertainty. He also questioned the fairness and practicality of a first-of-its-kind tax on assets and total wealth.