California’s Billionaire Tax Has a Polling Lead, Traders Give It a One-in-Four Shot

California’s billionaires are spending big to defeat a proposed tax on their fortunes, and prediction markets forecast they will likely succeed, even as polls show more voters support the measure than oppose it.

Proposition 40, which would impose a one-time 5% tax on the worldwide assets of California’s roughly 250 billionaires, received fresh national attention Wednesday from a New York Times Magazine examination of the battle between its supporters and the ultrawealthy residents fighting it.

The market assessment remains skeptical. Kalshi gives passage a 27% chance on $1.6 million in trading volume, while Polymarket puts it at 25%, with $3.9 million traded.

That is roughly a one-in-four chance of passage across two platforms, with combined trading activity of $5.5 million. It is not the same picture offered by recent surveys, which show the “yes” side ahead, but also suggest its position is vulnerable to a well-funded closing campaign.

Polling support has not translated into market confidence

Two September polls illustrate the gap.

A Public Policy Institute of California survey found 52% supporting Proposition 40 and 46% opposed. A separate Politico poll found 46% in favor and 40% against, leaving supporters short of an outright majority.

The Politico result also showed how much the contest had tightened. Its February-March survey recorded 50% support and 28% opposition. By September, opposition had risen 12 percentage points while support had slipped four.

That is a more complicated picture than either “voters want the tax” or “the measure is dead.”

Supporters still hold a polling advantage, but opponents have gained ground, and one survey put the yes vote below 50%.

Billionaires are funding the opposition

The financial imbalance is central to the campaign.

Google co-founder Sergey Brin has spent more than $100 million fighting the proposal, while Palantir co-founder Peter Thiel has contributed millions to the opposition, according to a Moneywise report.

Gov. Gavin Newsom also opposes the measure. His position gives opponents a prominent Democratic voice in a fight that otherwise might look like a straightforward confrontation between wealthy taxpayers and progressive tax advocates.

Supporters face another complication: Voters can favor taxing billionaires while also supporting restrictions that could weaken the measure. The PPIC survey found majority support for other proposals that would heavily limit Proposition 40’s power.

That makes ballot complexity part of the story, not merely an administrative detail. A polling lead for the tax does not necessarily mean voters have endorsed every element of how it would operate alongside other measures.

Ro Khanna makes the case for paying up

Rep. Ro Khanna, whose district includes much of Silicon Valley, has become one of the proposal’s most visible advocates.

The Times described an August town hall where an overwhelming majority of attendees raised their hands in support of the tax. Khanna argued that billionaires should view a one-time payment as a way to respond to mounting public anger over inequality, rather than simply as a bill to resist.

His support has carried a political cost. Khanna told the Times that he had lost at least 20% of his donor base, including several technology billionaires who previously supported his campaigns.

That divide captures the broader stakes. The proposal is not just a test of whether California voters will approve a tax aimed at a small group of exceptionally wealthy residents. It is exposing a split between parts of the Democratic Party’s affluent donor network and politicians embracing a more confrontational approach to concentrated wealth.

Khanna argues that conceding a relatively limited, one-time tax could help blunt demands for more aggressive action. The billionaires funding the opposition are pursuing the opposite strategy: defeating the proposal before it becomes law.

A long shot is not a settled outcome

Moneywise frames the measure as potentially “dead on arrival” based on prediction-market prices. That goes further than the numbers warrant. A 25% or 27% probability makes passage an underdog outcome, not impossible.

Nor does the available evidence establish that wealthy opponents are manipulating the markets. The report raises the general possibility that large trades can influence prices, but it does not document such activity in these California contracts.

There is also little evidence of a dramatic market reaction to Wednesday’s Times coverage.

The substantive divide remains: recent polls give the tax’s supporters a lead, while prediction markets expect defeat. With opposition spending already substantial and polling support showing signs of erosion, the closing campaign will test whether California’s appetite for taxing billionaires survives the campaign those billionaires are financing.