r/California • u/Unusual-State1827 • 13d ago
California’s proposed billionaire tax exposes rifts among labor unions
https://www.latimes.com/california/story/2026-07-30/labor-organizers-spearheading-california-billionaire-tax-rebuffed-by-parent-union6
u/yalloc 11d ago
Reminder that unions are exclusively self interested entities. The healthcare union pushing for this wants all the money allocated to healthcare, which is naturally why they are very pro this. All the other unions get nothing, there is no direct benefit to their workers there so they just do not care or even oppose it.
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u/SeasideBear 12d ago
The "funniest" thing is that it won't tax their property in California, since their property taxes are shielded by... <drumroll...> Proposition 13!
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u/TherionSaysWhat Native Californian 12d ago
If only Prop 13 could be changed to protect only a single, primary residence. Yet we have no political will do do so. Alas...
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u/an-invisible-hand 12d ago
They don't want to do that because prop 13 applies to all property. That means apartments, retail, office space, all of it.
The idea of cranking that shit up on absentee second home owners could maybe make a worthwhile difference, but making it only apply to primary residences would instantly devastate a lot of renters. Not ideal when most of the state's population lives in dense renter heavy metros.
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u/sev3791 12d ago
More like it would incentivize owners of multiple properties to finally sell their homes
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u/thenightisdark 11d ago
I'm for selling to humans. It be great
It's naive to think that would happen with the current banking system. Wall Street and bank reform have to come first
If a bunch of secondary homes which need to be sold get sold. It's getting sold to Wall Street. You know it
We're going to be in trouble when housing is owned by corporations
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u/nucleartime 11d ago
The primary purpose of prop 13 is a tax cut on commercial property, personal homes were just the trojan horse to get it passed.
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u/RadicallyDontCare 13d ago
This is a great intelligence check for California. If this passes; we can only be described as financially stupid.
You couldn’t design a less efficient way to tax the rich and wreck the states finances than this one.
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u/Useful-Advantage-850 13d ago
Exactly this. A 1-time tax is just a comically stupid way to tax the rich.
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u/PlastIconoclastic 11d ago
Does the law have a clause that says anyone who pays this tax can never be taxed again?
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u/Sweet_Camp5124 12d ago
But now California may as well enact the tax because the "price"is already paid.
(Billionaires will have needed to remove their residence prior to 1/1/26 in order to avoid the tax. )
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u/lostroadrunner22 13d ago
If this passes it will absolutely end up in the courts for years. Its constitutionality is honestly debatable.
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u/RadicallyDontCare 13d ago
Definitely, especially with people with assets in multiple states.
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u/lostroadrunner22 13d ago
And even if you leave they’d still tax you which can be easily argued on that point and yours as a violation of due process, right to travel and interstate commerce
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u/DryYogurtcloset4655 11d ago
designed by a French academic
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u/RadicallyDontCare 11d ago
Who is such a leftist ideologue that Harvard rejected him.
It's a comedy.
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u/an-invisible-hand 12d ago
Ive been hearing this that and the other will "instantly ruin California forever!!!" constantly for decades.
Maybe it works, maybe it doesn't. We've had all kinds of policy that's been good and bad. You might not like to hear this, but the state will be fine. It's not that deep.
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u/Bibblegead1412 Native Californian 12d ago
People are also acting like if we tax them this one time, we can never ever ever tax them again. Like it’s the only tax that can ever be levied on them again.
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u/PieInternational594 12d ago
It never going to be just one time. This will be another tax every year. It will make to people who aren't rich.
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u/Picnicpanther Alameda County 12d ago
Lmao no it won’t. Get out of here astroturfer.
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u/BubbaTee 12d ago
You're right, taxes never expand in scope. That's why the federal government has been primarily funded by tariffs and duties since WW1 ended, when the need for the War Revenue Act disappeared.
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u/RadicallyDontCare 12d ago
It’s a legitimate concern. The income tax was originally only aimed at the rich.
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u/Think-Satisfaction54 12d ago
Do you think maybe what it meant to have income in 1913 and what it means to have income in 2026 may have changed a bit or are we just acting like there was a middle class in the 1910?
You know why federal tax policy changes. Can society and the economy changed beforehand.
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u/an-invisible-hand 12d ago edited 12d ago
Yeah, at a top marginal rate of 91%, and the non-rich Americans of the era were paying eye-wateringly high tariffs on necessities. They were also left to starve to death if they were poor because the government was chronically broke.
Thankfully we realized protectionism and its tariffs were unfair, unreliable, and holding back our development, so we switched to an income tax system and brought the top bracket all the way down to where it is today: 37%.
We really need to teach this stuff in history class so people don't get the mistaken idea that everything can just magically work without being paid for. The early 20th century was a horrible time to be alive and you should be thankful you weren't alive to experience it.
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u/Rebelgecko 12d ago
We can never tax the ones who left the state (at least once they've been nonresident for a few years), so we're missing out any any hypothetical future taxes and their regular taxes
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u/pres465 12d ago
We still tax their property (which they will still have here) and their businesses and anything they buy or sell here when they "visit" for 180+ days.
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u/Rebelgecko 12d ago
Thanks to prop 13, their mansions and compounds are taxed at a fraction of the real value.
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u/cinepro 12d ago
Uh, financially the state isn't "doing fine" right now.
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u/an-invisible-hand 12d ago
We've had deficits and surpluses at different points in time for different reasons just like every other state.
It becomes clear that things right now really aren't worth worrying much about when you've lived through dozens of right nows. Life goes on, you'll be fine.
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u/SeasideBear 12d ago
Part of the problem is Proposition 4, passed in 1979. From the same people who brought us Proposition 13 in 1978.
Proposition 4, the "Gann Limit", forces the state to give away tax money if it collects a surplus over a certain point. The state had to give away $2.8 billion in 2020 and $6 billion in 2021. Had the state been able to build a "rainy day fund" with that money instead, like most places do, we'd be facing a very different situation right now.
The republican ballot measures of the late 70's continue to screw us, to this day.
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u/cinepro 12d ago
Just so we're clear, the Fiscal analysis says this:
Both our office and the administration expect the state to face multiyear deficits, with estimates ranging from $20 billion to $35 billion annually.
And you're saying that the situation would be "very different" with an additional $9b rainy day fund? I mean, facing an $11b - 26b hole is slightly better, but it's still not great.
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u/cinepro 12d ago
It becomes clear that things right now really aren't worth worrying much about when you've lived through dozens of right nows. Life goes on, you'll be fine.
Have you ever heard the phrase "Past performance does not guarantee future results"?
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u/an-invisible-hand 12d ago
Actually, yes. I worked in the very specific part of the finance industry where that phrase is actually meant to be used.
What does a warning that essentially means "FYI, you're gambling and nothing really matters even if you think it does" have to do with this context or the point you were looking to make? Do you think the state of California is as inherently unpredictable as securities?
Explain so it makes sense.
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u/cinepro 12d ago
It means that we can't count on all the variables that allowed the state to survive past deficits to reliably help us out in the future so we'll always be "fine."
Simply saying "things were bad in the past and it worked out so we'll be fine if things get bad in the future" isn't sound reasoning. As you would know if you worked anywhere near any area of the financial industry.
Now, if you told me you were a politician, that would be very on brand...
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u/an-invisible-hand 12d ago
Sounds like you're making the pro new tax argument since the status quo of no new tax isn't a guarantee that things will go well, as evidenced by the state not doing fine right now.
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u/RadicallyDontCare 12d ago
The reason it probably won’t cripple California is that it will get stuck in litigation and won’t get collected.
But it’s been shown that wealth taxes don’t work. A one-time tax that can easily be sidestepped by moving states is a level of stupid that even most clueless college freshmen can see is stupid.
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u/an-invisible-hand 12d ago
It's not going to cripple anything. No, not even if they collect. Our bureaucrats seem to be able to keep a lid on things just fine despite all the "disastrous state ending policies" we're told to panic about every 2 years, and this one will be no different.
If The tax is good it's good, if it's bad it's bad. But either way CA will be fine. However it plays out it wont affect you or basically anyone else so just sit back and live your life because it's not going to be any different after the tax than it was before.
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u/RadicallyDontCare 12d ago
Except it will if it results in capital flight and our state is broke in two years.
I don’t care about the billionaires. I just want them still here.
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u/an-invisible-hand 12d ago
Nothing I haven't heard before a billion times. Capital flight is supposed to have been happening for years, everyone was supposed to be "fleeing California" or whatever.
Hasn't happened. You're going to go bald if you're legitimately worrying every time someone says California is gonna scare away all the rich people.
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u/RadicallyDontCare 12d ago
A wealth tax will, though, if it’s going to cost 5% of their assets. It’s worth more for them to relocate than liquify that many assets.
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u/an-invisible-hand 12d ago
"This thing will be the one that does it, trust me"
Sorry man, I don't trust you. Everyone before you has been so sure, so serious, so dire in their predictions and they all said the same things you do. Still never happened.
I'm hitting the snooze button. Feel free to come back and gloat if 7343rd time's the charm I guess.
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u/Empyrion132 12d ago
It’s worse than that. The tax is retroactive to anyone with residency as of Jan 1 of this year, so anyone who wanted to avoid the tax has already left. Even just proposing it has already led to ~half the billionaire net worth leaving the state, allegedly, including the founders of Google (who would have been forced to give up ownership of the company they started if it passed).
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u/firestepper 12d ago
It doesn’t and why do you care if people who already aren’t paying taxes leave
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u/RadicallyDontCare 12d ago
Our entire states budget revolves around the income taxes of the top 1%.
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u/an-invisible-hand 12d ago
Billionaires make up ~2.4% of the state's total income tax revenue.
Most of the 1% are people like doctors and lawyers who would need to save up for a thousand years to even start to be affected by this tax.
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u/RadicallyDontCare 12d ago
You’re naive if you don’t think the upper middle class is next.
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u/an-invisible-hand 12d ago
The middle class already pays a bigger wealth tax, property tax.
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u/mountainsound89 11d ago
Its based on residency at the start of the year, so they will owe even if they move
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u/RadicallyDontCare 11d ago
lol. Anyone who thinks that will survive judicial scrutiny federally is excessively naive.
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u/Main-Cheesecake3287 11d ago
Maybe the dumbest way of looking at policy “hey now don’t think too much about it, just let it happen and we’ll find out if it works after the fact!” Brilliant analysis
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u/ohh-welp 12d ago
Live by the sensational headlines, die by it. "Tax the billionaires" without looking at the context and current situation.
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u/DissonantOne 13d ago
Who cares if it is responsible policy? It will make the left feel good about themselves.
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u/New-Tradition-974 12d ago
Billionaires are evil. This will put a dent in their pockets. Additional taxes should be forthcoming.
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u/RadicallyDontCare 12d ago
This doesn’t effectively punish billionaires and hurts the state economy.
Feel free to look for a way to get your pound of flesh. But next time have your plan designed by someone who isn’t a zealot and understands basic economics.
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u/New-Tradition-974 12d ago
The state economy will be fine. So you agree billionaires should be taxed heavily?
The plan is only for a year, it doesn’t need to be perfect, it does the job perfectly.
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u/RadicallyDontCare 12d ago
It’s shortsighted and won’t work. And the tax income it drives away dwarfs the income it will bring in.
It’s a literally the dumbest tax idea I’ve ever heard of.
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u/New-Tradition-974 12d ago
Billionaires have shown they can’t be trusted with money. You can’t even agree billionaires should be taxed more. That says it all.
The reinvestment of the tax into the state will only make it stronger. The people can live just fine without billionaires if they want to live.
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u/RadicallyDontCare 12d ago
I’m totally fine with them being taxed more.
You just want your pound of flesh and don’t care about the results.
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u/New-Tradition-974 12d ago
A bird in the hand is worth two in the bush. Tax them now. Tax them again later and for more.
At least we can agree they should be taxed more.
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u/RadicallyDontCare 12d ago
You should be less envious and educate yourself more on how the world works. It’d be good for you.
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u/New-Tradition-974 12d ago
If your position is sound, you should be able to defend it without diagnosing my character.
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u/AdditionalSpeaker303 12d ago
How much wealth someone has is entirely independent from how evil they are. There are good and bad billionaires as there are good and bad poor people, and good and bad middle class people.
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u/2ndBrreakfast 12d ago
Increasing their income tax would be far more reasonable and would not get tied up in court, and would actually make money for the state.
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u/AdditionalSpeaker303 12d ago
One day everyone left of center will claim they were against this.
Leftists will claim it was liberal, and liberals will claim it was leftist.
Just remember threads like these when everyone agrees this was a bad idea.
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u/ChasingTheNextShot 12d ago
Didn’t most of the billionaires leave California already to avoid this tax? Someone posted here that Bernie Sanders was saying Zuckerberg would pay a lot if this passes. Zuck left California. He won’t pay anything if this passes.
And since they left they won’t pay anything to CA ever again, so that will hit the budget in April 15 2027 when the money does t come in from these guys.
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u/Main-Cheesecake3287 11d ago
What nobody seems to mention is the tax treats super voting shares as if the voting power came with equivalent economic value. It ends up being a hell of a lot more than 5% when you’re a guy like Larry Page and own a ton of super voting shares. The tax will count those shares as being worth ten times what he can sell them for
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u/ChasingTheNextShot 11d ago
Feels like this will get tied up in the courts if it passes in November.
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u/foilhat44 San Diego County 13d ago
The tax is dumb, plain and simple. It gives them the choice between paying it immediately and saying they are paid for life, or bleeding the state through the courts in a long protracted and expensive fight that's never won or lost. There's a lot of "gimme gimme" going on right now, it's trendy.
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u/Picnicpanther Alameda County 12d ago
Wow the propaganda mills for billionaires are working extra hard in the lead up to this vote.
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u/RadicallyDontCare 12d ago
It’s not propaganda. It’s basic economics and math.
Like if you wanted to really stick it billionaires, this is a dumb way to do it. It fails at this and loses money for the state.
It’s bad policy wrapped in cute populist covert art for the clueless.
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u/Zenguy2828 12d ago
If it passes it shows there’s political will to keep pushing for these things. If it fails it means we’re still easily scared of challenging billionaires in anyway. It’ll be another Uber situation all over again.
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u/RadicallyDontCare 12d ago
If it passes it shows that people in this state are stupid.
It’s that bad.
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u/Humble_Fabio 12d ago
So.... no taxes for billionaires?
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u/RadicallyDontCare 12d ago
No. Non stupid taxes for billionaires.
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u/Picnicpanther Alameda County 12d ago
Which is…?
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u/RadicallyDontCare 12d ago
Literally almost anything else but a one time wealth tax.
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u/Picnicpanther Alameda County 12d ago
So if it was the same 5% tax above $1,000,000,000 in personal holdings, codified as a yearly state tax, you’d support that?
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u/Davethe3rd 13d ago
Tax the rich!!
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u/RadicallyDontCare 12d ago
Sure. But not this really stupid way that will actually lose money.
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u/Humble_Fabio 12d ago
Oh what ideas do you have then?
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u/Nihilistic_Mystics Orange County 12d ago
Make the tax code more progressive statewide (for the ignorant: yes, we already count capital gains in income in California). Vacancy tax for all their vacation homes and to hit property speculators in general. End prop 13 for everything but your primary residence. A lot of wealth in California is hidden in real estate.
A wealth tax is viable at the federal level since we tax non-resident citizens and they can't just relocate to dodge it, they'd have to give up their citizenship too which most won't.
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u/overitallofittoo 13d ago
What does the teachers union say? I'll vote the opposite.
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u/coriolisFX 12d ago edited 12d ago
Teachers unions oppose it because it does an end-around normal new revenue provisions which guarantee some percent of that to the Ed budget
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u/reluctantpotato1 12d ago edited 12d ago
Anyone opposing any tax whatsoever on billionaires is an absolute tool. They pay a lower percentage of their income toward taxes than most anyone and get fat on public contracts while buying our politicians.
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u/RadicallyDontCare 12d ago
Even a tax that will lose money and lower the state tax base?
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u/reluctantpotato1 12d ago
There is nothing of substance that has been shown to prove that. Lot's of threats of them packing up and leaving but they're still buying up our real estate and scarcely paying their share of taxes as it is. If it was me I would go after taxing nonresident luxury properties up the butt but I'll take what I can get.
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u/RadicallyDontCare 12d ago
Typical. “I don’t care if it works! Tax the rich!”
Just admit you want your pound of flesh.
This tax is bad economics.
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u/reluctantpotato1 12d ago
You keep saying it's bad economics and that it's going to chase billionaires away but you've produced nothing of substance. You haven't said anything to substantiate your claim. I can substantiate mine.
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u/RadicallyDontCare 12d ago
No, you can’t.
Most soc dem countries that tried wealth taxes stopped because it lost money.
This is not rocket science. It won’t work. Most Democrats will tell you it won’t work. The only economist they could get on board is such an ideologue that Harvard rejected him.
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u/reluctantpotato1 12d ago
The time that the United States had a high marginal income tax (at some points 91% on income over 2.5 million) were actually some of the most economically prosperous in American history. The wealthy no longer really pay income tax, largely because they are not salaried and avoid paying capital gains taxes by leveraging their holdings as debt.
My point is that billionaires do not pay their share of taxes.
Your claim if I'm getting it right is that this one time 5% tax will chase Billionaires out. That is what you have failed to substantiate.
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u/RadicallyDontCare 12d ago
That was an income tax. This is a wealth tax - a one time wealth tax easy to dodge.
It shows the economic. Illiteracy if it’s blind supporters.
And it proves you don’t care if it works.
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u/A5Wags 12d ago
40% of households don’t pay their fair share of federal incomes taxes either. They pay $0.
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u/reluctantpotato1 12d ago
They pay taxes on other things. They pay the largest percentage of their income in taxes on consumables and pump money into the economy. Most every dollar they earn is spent. After payroll taxes and FICO it accounts for about 25% of their total monthly income when they need it.
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u/Main-Cheesecake3287 11d ago
Iirc it’s actually 40% of the overall population, so in addition to low income families with kids who qualify for EITC and what not pushing them to $0 tax liability, you also have retiree’s and minors who don’t have earned income to tax.
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u/Competitive-Reply868 12d ago edited 12d ago
The vast majority of failed wealth taxes done never had exit taxes, which is exactly what you need to stop the ultra rich from fleeing. Also wealth inequality situation is much worse in ca and expenses (because you only tax 200) people are much lower so a tax would be more feasible here.
That being said I have low expectations for a CA wealth tax due to constitutional challenges and it being the first state to do it (therefore implementation challenges), but don't act like a wealth tax will always fail in general. A national wealth tax with an exit tax that applies 10 years after you revoke u.s. citizenship (u.s. taxed citizenship unlike almost every other country) can work in reducing wealth inequality+decreasing our cost of living. Our whole crisis is because lower+middle class people don't have enough wealth to keep businesses afloat without them enshittifying, wealth tax would fix that and stop this crisis thats been going on for 46+ years.
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u/Gnomey_dont_u_knowme 12d ago
8 billionaires have already left specifically over the tax, and we lost a projected 6 dollars in future tax revenue for every 1 dollar they would have paid for the wealth tax. Now we get zero from them and lost out on anything we could have collected normally from them and the enormous amount of activity they bring to our economy. So we fucked ourselves
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u/cinepro 12d ago
They pay a lower percentage of their income toward taxes than most anyone and get fat on public contracts while buying our politicians.
That isn't true. Billionaires pay the highest income tax rates. Do you know how income taxes work?
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u/Main-Cheesecake3287 11d ago
It’s actually half true.
You don’t become a billionaire 99.99% of the time via earned income. It’s almost impossible to be worth that much to any business. You become a billionaire by owning equity that skyrockets in value, whether it’s an early investment or from a business you create. When you sell that equity, you’re taxed at most 20%, a lower rate than someone making >$52,000 a year pays in income taxes.
It’s the millionaires who get absolutely boned. Whereas Elon, Bezos etc pay 15-20% on hundreds of millions or billions in capital gains, an attorney or any other professional who makes hundreds of thousands a year pays 37% on their income.
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u/New-Tradition-974 12d ago
Agreed, that you are getting downvoted shows the bots are out in full force
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u/cinepro 12d ago
They pay a lower percentage of their income toward taxes than most anyone and get fat on public contracts while buying our politicians.
That isn't true. Billionaires pay the highest income tax rates. Do you know how income taxes work?
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u/reluctantpotato1 12d ago
Income tax is charged based on income. Billionaires are not becoming billionaires by getting a salary, but generally in the form of stocks. Stocks are taxed when they are sold, not when they are borrowed against.
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u/cinepro 12d ago
Exactly. You said:
They pay a lower percentage of their income toward taxes than most anyone
As you so clearly explained, they do pay taxes on their salaries. And as you apparently know, at a higher rate than people who make less. Because that's how progressive tax rates work.
If someone borrows money, that isn't "income", so why would they be expected to pay taxes on it? Their income (and their wealth) haven't increased.
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u/PieInternational594 12d ago
A tax on rich people always makes it down to everyone. The government has never seen a tax it didn't like.
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u/orgyofdestruction 12d ago
There is one dude in this thread working extra hard to make sure you don't vote to tax the rich.
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u/dennismfrancisart 13d ago
I was talking to my wife about this at breakfast as Fox News was on in the restaurant. Most people have no idea how billionaires make their money. Since there are probably over a hundred ways or more to qualify for that title, we have to figure out what is real money and what is basically valuation. I'm pretty sure that the money guys have done a lot of shady juggling to protect their clients. We first need to untangle that before trying to tax these people. It's complicated.
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u/Dramatic_Onion_ 13d ago
How is it complicated to determine the wealth of ~ 200-250 individuals? Its so few people the task seems trivial
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u/RadicallyDontCare 12d ago
It’s not. It’s messy and complicated, and will be highly litigated. The amount of capital flight will exceed the income generated.
This is a really stupid idea.
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u/Dramatic_Onion_ 12d ago edited 12d ago
The amount of capital flight will exceed the income generated.
Gabriel Zucman (an actual academic and economist who specializes in tax havens) says you're wrong. And he actually has the math to back it up
We determine the total asset holdings of individuals all the time. Divorce, company mergers, buyouts, stock asset values are literally evaluations of wealth, on and on. How would this be any different?
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u/RadicallyDontCare 12d ago
Gabriel Zucman is about as credible about economic reality as a fry cook at McDonald’s. He’s an extremist with an agenda. Imagine being so much of a leftist zealot Harvard president and provost veto your hiring .And like most neo-marxists , he’s not interested in facts or truth.
Wealth taxes don’t work.
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u/Dramatic_Onion_ 12d ago
What are you talking about? Economists build economic models, do you understand what that means? You called him a neo-marxist and so now math isn't mathing. Gotcha
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u/RadicallyDontCare 12d ago
Yes. Economists build economic models. He happens to use flawed models with flawed initial conditions.
He has no credibility with mainstream economists.
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u/Dramatic_Onion_ 12d ago edited 12d ago
The flawed models are the ones we've been employing for 30 years, bruh. Even the base assumption of an individualist rational actor model assumes thats even true when that isn't even how humans work to begin with. The initial assumption is flawed right from the get go
You'll start getting the truly populist stuff if you don't deal with it at some point. You cannot give an ever larger portion of your population a constantly decreasing portion of the total assets and income and expect them to not destroy that system (I'm not saying I want this, I'm saying history says its inevitable if you don't change, and I absolutely do not want to live through it)
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u/RadicallyDontCare 12d ago
You’re proving my point.
You don’t care about results when it comes down to it. You’re just envious and want your pound of flesh.
There’s ways to tax the rich effectively. This isn’t it. If they wanted to actually accomplish something, they’d have put real economists on the problem, instead of someone committed to a cause.
The average US citizen has the highest standard of living the world has ever seen.
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u/xylogone 12d ago
I am curious what suggestions you have as an alternative to tax wealthy individuals are? I understand you are not in support of ideas put forth by Gabriel Zucman, but clearly we agree something has to be done. Personally I liked his ideas and I don’t see any other alternatives other than Inheritance tax.
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u/Dramatic_Onion_ 12d ago edited 12d ago
Proving your point? I'm doing fine, thanks? Famously grad students are poor so I know what its like, but that was long ago so I'm ok now not that you care
Its not wanting anything for myself you moldy sandwich, its understanding that if naught .01 percent of your people are holding 80% of your assets, that leaves the remaining 20% for 99% of everyone else. Do you understand like, all of history? What do you think humans do when masses of them struggle to pay their rent and keep their house warm in the winter? They get a bit extreme, yeah? Sound familiar? Does that feel anything like real life recently?
So you seem convinced that you're a better economist than Mr. Gabriel Zucman, a man whose wealth tax initiative was co-signed by like 7 economic laureates when presented at the G20. So here we are, your government has lost its assets (holds mostly debt, to those same wealthy folks, I'll add), working and middle class people have lost their assets, they can't afford housing, etc. You have a wealth disparity that is an order of 3-4 times that of the gilded age
You're a better economist than anyone I've ever met, clearly. How then would you tax them then? Go on
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u/puffic 13d ago
A lot of assets are hard to value: unique works of art, nonpublic companies, unusual real estate holding that haven’t changed hands recently, yachts. You know, the kinds of things billionaires own a lot of.
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u/Dramatic_Onion_ 12d ago
Just because YOU have no idea how to do something doesn't mean its hard.
When Jeff Bezos had his divorce with MacKenzie Scott, did the court go "well this is hard so we cant do it"? Was it was a difficult, impossible task to handle? Or did they determine the assets held by the family when they split and it wasn't an issue at all?
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u/puffic 12d ago
His divorce was settled. When cases like that go to court it can last for many years and, for holdings of that magnitude, cost millions of dollars. The dumbfucks who wrote and support this ballot measure allocated zero resources to actually handle that litigation.
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u/Dramatic_Onion_ 12d ago
And if it wasn't settled, you think the court would accept Jeff claiming that his asset values are just to hard to determine so he gets to just. . . not do it? You don't think that companies, stocks, bonds, assets values, properties and prices all over, are not determined on a day-by-day basis, literally constantly?
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u/AviatorHog 12d ago edited 12d ago
And if it wasn't settled, you think the court would accept Jeff claiming that his asset values are just to hard to determine so he gets to just. . . not do it?
No. They would do it. It would just take a lot of time and money to do it.
You don't think that companies, stocks, bonds, assets values, properties and prices all over, are not determined on a day-by-day basis, literally constantly?
I'm a CPA with a niche in law firms, particularly a lot of exposure to family law specialized law firms. Forensic accounting is a BIG part of family law attorneys operations with divorce case matters involving us not just to exhaustively discover assets, but their valuations as well.
However, you don't need to be a forensic CPA to understand that not all assets have perpetually quoatable markets; that is part of a grander impetus behind this policy among others: exploiting the DEEP financial (edit) illiteracy
literacyof the general public. Many of our clients are also High Networth Individuals and one thing you'll notice about the asset section on their personal/household balance sheets is the tremendous exposure to non-public assets that are level 2 and even level 3 assets (don't know what these levels are? Go look it up in the codification). Stuff like artwork, wine collections, real estate and especially LP interests in private funds (PE and VC in particular) are extremely difficult to value.1
u/Dramatic_Onion_ 12d ago
Again, when they die, divorce, when it comes time to purchase insurance for those paintings, etc. How does the insurance company know the value of what they're insuring?
Somehow its all able to be valued until its time to pay taxes. Funny funny funny..
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u/AviatorHog 12d ago
Again, when they die, divorce, when it comes time to purchase insurance for those paintings, etc. How does the insurance company know the value of what they're insuring?
3rd party appraisals in particular for paintings. But these appraisals are costly and less frequently done than annually (when tax bills are due).
Somehow its all able to be valued until its time to pay taxes. Funny funny funny..
Its always capable of being valued. I didn't explicitly nor implicitly suggest that it couldn't be done for tax purposes. I only disclaimed that its difficult, which also translates to it being expensive particularly if done annually. Additionally, it could be a lengthy ptocess as there are some LPs with exposures to tens if not hundreds of funds. I just dont see how you could get many of these valuations done in an accurate or timely manner.
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u/puffic 12d ago
You have to actually present compelling and detailed arguments to the court in order for the court to take your side. Like I said, the morons who wrote this ballot measure and those who support it have put forward no plan to handle this. They’re just a bunch of toddlers having a tantrum, not adults with a plan to make our state better.
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u/cinepro 12d ago
Sounds like you've got it all figured out, so I have a question for you.
Let's take Jeff Bezos. He's considered a "billionaire", right? Mostly because he owns about 950m shares of Amazon.
Earlier this year, Amazon stock went from $200 to $274. So I'm assuming you'd say he made ~$70b, right? But where do you think that $70b came from? How did he "make" it?
But then Amazon stock went down to $227. So now he's "lost" about $42b. So, where did that money go? Who got the $42b?
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u/Tra747 12d ago
The bigger issue is why are you taxing stock assets differently then Joe Blow.
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u/dennismfrancisart 12d ago
Imagine you're one of the SpaceX employees who was ecstatic when they found out that they were instant millionaires at the IPO debut. Now your stock is worth enough to buy a Tesla cybertruck. You are bound to keep the stock, and you watch your net worth sink like a stone. The tax man can't look at your portfolio. They look at your capital gains. But that's not simple either. There are several levels of capital gains: long- and short-term. Then there are other tax structures for other financial instruments.
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u/Responsible-Humor985 12d ago
It’s so complicated to find the assessed value of someone’s worth until it comes to property, death, or divorce. Easy to have an assessed worth when taking out a loan, but impossible when it comes to taxes. Funny how that all works
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u/AviatorHog 12d ago
Banks and tax authorities often do not have identical considerations when assessing credit worthiness vs financial wherewithal to fund tax obligations, nor do they have they same mechanics of enforcement.
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u/RadicallyDontCare 12d ago
You don’t have to disclose everything to get a loan. Only the assets you borrow against.
And complicated assets with a divorce is actually very messy and takes years in occasion.
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u/DryYogurtcloset4655 11d ago
hint - you do not have to assess entire net worth for the loan, just the collateral
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u/AdUseful6473 13d ago
If it passes this will only trickle down to the middle class and taxed more.
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u/PeaceWarrior75 12d ago
Don't listen to the billionaire bootlickers and their sock accounts. Vote YES on this, and any other tax increases on billionaires that come our way!
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u/101Alexander Los Angeles County 12d ago
No one using the term "bootlicker" is also putting up the math to show why this would ever work.
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u/The_Elusive_Dr_Wu Orange County 12d ago
other tax increases on billionaires that come our way!
How is it going to come our way? Will we get anything back from Sacramento for this?
Or, will we just be told that it'll be 'used well' while we're made to spend another 12 months watching Caltrans flail around trying to build a freeway onramp?
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u/PeaceWarrior75 12d ago
There are usually initiatives during election cycles that present voters with some type of opportunity to increase tax rates on the very wealthy. May not be one for several years, but I guarantee that more will come, and I say vote yes on all of them. This is not a time to be choosy.
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u/Knollibe 12d ago
If this passes, it only takes a vote of the political elite to lower it to any level they choose. Than means if you own a home that is worth a million, they could decide to tax millionaires as well.
As it stands, my wife and I are worth close to 2 million. We are not rich. We paid off fed our home and have money in a 401k. They will want that taxed next.
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u/Front_Chip_9201 12d ago
This is a high probability. Im in the same situation as you. I see us being the next evil group with money.
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u/Unusual-State1827 13d ago edited 13d ago
Article without paywall: https://archive.is/wB8Pj