Silicon Valley is staring down a tax revolt of its own making—only this time, the pitchforks are pointed at the billionaires.

A proposed California ballot measure, backed by the Service Employees International Union–United Healthcare Workers West, would impose a one-time 5% wealth tax on state residents with assets exceeding $1 billion. The union estimates the levy could raise up to $100 billion from approximately 200 billionaires, with proceeds earmarked to offset potential federal healthcare funding cuts.

But before a single signature has been gathered, the measure is already reshaping decisions in corner offices across the Golden State.

The Great California Calculation

For billionaires, the math is stark. A 5% tax on $10 billion in assets translates to a $500 million one-time hit—a sum large enough to make even the wealthiest reconsider their zip code.

Peter Thiel, the PayPal co-founder and venture capital titan, is among those exploring options. According to reports, Thiel owns a home in the Hollywood Hills and operates his personal investment firm Thiel Capital from Los Angeles. He has reportedly explored opening offices in other states and spending more time outside California.

Larry Page, co-founder of Google, has taken more concrete steps. In mid-December, three limited liability companies associated with Page filed incorporation documents in Florida, according to state records. The move suggests the tech pioneer is establishing a legal presence outside California well before any vote takes place.

"There will be no billionaires left in California."

— Chamath Palihapitiya, venture capitalist

The Retroactivity Problem

What makes this proposal particularly urgent is its retroactive clause. The measure would apply to anyone who was a California resident as of January 1, 2026. That means billionaires who wait until after the new year to relocate could still be on the hook for the full tax—even if they've moved to Texas or Florida by the time the measure passes.

This has created a December deadline of sorts, with wealthy Californians racing to establish residency elsewhere before the clock strikes midnight on 2025.

Tech Founders Sound the Alarm

The response from Silicon Valley's startup class has been visceral.

Palmer Luckey, co-founder of defense technology company Anduril, argued the tax would force "founders like me to sell huge chunks of our companies" to cover the bill. He characterized the spending as funding "fraud, waste and political favors."

Garry Tan, CEO of startup accelerator Y Combinator, warned the proposal would cause companies and entrepreneurs to flee California "en masse."

The concern isn't just about liquid assets. Many tech billionaires hold the bulk of their wealth in company stock—assets they would need to sell to pay the tax. Such forced selling could trigger loss of control, destabilize stock prices, and fundamentally alter the ownership structure of major technology companies.

The Political Landscape

Governor Gavin Newsom has come out against the measure, calling it "not pragmatic." He's actively raising money to oppose it, with venture capitalist Ron Conway contributing $100,000 to the effort in November 2025.

But not everyone in the Democratic establishment is sympathetic to billionaire concerns. Rep. Ro Khanna, who represents a portion of Silicon Valley, responded to reports of billionaires threatening to leave by echoing President Franklin Roosevelt: "I will miss them very much."

What Happens Next

The measure still faces significant hurdles. Supporters must gather enough signatures to qualify for the November 2026 ballot—no small feat for a proposal that has united opposition from both the political establishment and the business community.

But regardless of whether the measure ultimately passes, its mere existence is already having real effects. The threat of a wealth tax has accelerated discussions about geographic diversification among California's wealthiest residents, potentially seeding an exodus that could reshape the state's tax base for years to come.

For investors, the implications extend beyond California. Any significant departure of tech capital could affect venture funding, startup ecosystems, and the broader innovation economy that has made the Golden State the world's fifth-largest economy.

The billionaires may be making their calculations. California is about to find out if it can afford to let them leave.