Mere millionaires in California are now eyeing the exits over fears that a billionaire tax could be tweaked to target smaller fortunes, a tax advisor to the mega-rich revealed.
The proposed 5% wealth tax on billionaires was just cleared for the November ballot this week — but California’s millionaires were already spooked about the ramifications of the controversial proposed levy, said David Lesperance, a tax advisor to high-net-worth families.
Now the tax guru told The Post that it isn’t just billionaires hatching plans to potentially exit California over the controversial proposal, backed by SEIU-United Healthcare Workers West and lefty pols like Vermont Sen. Bernie Sanders.
“I started getting calls from people who are saying, ‘Oh, it could be permanent?’” Lesperance explained.
The billionaire tax received more than a million verified signatures in qualifying for the November ballot, the secretary of state said this week — though Gov. Gavin Newsom has been attempting to strike a deal with proponents to kill it entirely.
Billionaire tax backers offered to reduce the levy to 2% in an open letter Thursday, but Newsom said he doesn’t support the compromise.
Lesperance referenced comments from UC Berkeley professor and billionaire tax author Emmanuel Saez, who admitted in a debate last month that the proposed tax on the total assets of billionaires might not be a one-time thing.
“If there is another one, I don’t think it’s going to be a one-time tax. You can’t surprise billionaires more than once,” Saez said during a May 5 debate with Arthur Laffer.
The California Business Roundtable claimed in an April memo that the billionaire tax could be tweaked by the state legislature to include even middle-class California households. SEIU United Healthcare Workers West has strongly denied this, saying any amendments “cannot change the fundamental purpose of the act.”
“Any illusions that this is going to be a one-time thing were thrown out the window. The consensus is that … they can definitely lower the threshold,” said Lesperance, founder of tax and immigration advisory Lesperance & Associates.
“They can read polls like anybody. So they’re sitting there going, okay — this thing is very popular.”
A survey by the Public Policy Institute of California conducted in mid-May found that 54% of likely voters agree with the tax.
Some of Lesperance’s clients who are wealthy — but worth well under $1 billion — see writing on the wall not only in California, but from federal lawmakers like Massachusetts Sen. Elizabeth Warren, who proposed a 2% annual tax on households worth $50 million or more.
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Lesperance further argues that the billionaire tax leaves room for interpretation by the Franchise Tax Board, meaning that billionaires such as Mark Zuckerberg, who owns 60% voting shares in Meta, could be taxed partly based on the company’s $1.6 trillion valuation — potentially leaving him with a bill of $48 billion.
“You don’t think he’s gonna leave? I mean … does Zuckerberg need to be in California?” he said.
Nevada, Texas and Florida are popular destinations for the ultra-rich in search of tax-friendly locales, Lesperance noted.
One tony enclave just east of the Nevada Border, Incline Village, has become a go-to spot for billionaires like Sergey Brin and SpaceX investor Steve Jurvetson, who have snapped up properties in the idyllic spot near Lake Tahoe.
State leaders have about a week to try to negotiate the measure off the ballot and strike a deal with SEIU-UHW, which represents more than 120,000 healthcare workers, patients and consumers across California.
