A proposition on California's November ballot contains fine print that could prevent the so-called California Billionaire Wealth Tax from ever taking effect, even if voters approve both measures.
Tax expert and retired election law attorney Chuck Bell describes Proposition 42 as a puzzle.
"It's a little bit of a Rubik's Cube," Bell said.
Proponents of Prop. 42 say the measure is designed to protect retirements, savings, and pensions from a potential vote to "double tax" your money, and that Prop. 42 closes that loophole. Prop. 42 spokesperson Nathan Click said some labor groups, including firefighters, construction trades, and veterans, support Prop. 42.
Prop. 42 is also tied to Proposition 40, which its supporters call and filed as "The California Billionaire Tax." Those opposing Prop. 40 call it "The California Wealth Tax." For this report, KSBY News will refer to it as the "California Billionaire Wealth Tax."
Websites for both "pro and con" sides of the tax-related propositions can be found at the following links:
CA Proposition 40: California Secretary of State's Voter Guide on Prop 40 | Yes on Prop 40, No on 41 and 42 | No on Prop 40
CA Proposition 42: California Secretary of State's Voter Guide on Prop 42 | Yes on Prop 42 | No on Prop 42 (Yes on 40)
KSBY News Reporter Jessica Roe asked Prop. 42 spokesperson Click whether the initiative is a direct countermeasure to Prop. 40 based on the language in section five of Prop. 42, which reads:
- "In the event that this initiative measure appears on the same statewide election ballot as another initiative measure that would establish, enact, create, impose, or authorize collection of a tax on the ownership or control of retirement holdings, individually owned assets, and other forms of personal savings, or enact a tax that would result in tax liability based on conduct, activities, or a status that occurred or was present prior to the effective date of the initiative measure, then that other initiative measure shall be deemed to be in conflict with this measure. In the event that this initiative measure receives a greater number of affirmative votes, the provisions of this measure shall prevail in their entirety, and all the provisions of the other measure shall be null and void."
Click addressed both the purpose of Prop. 42 and the arguments and rebuttals in the California Secretary of State's Voter Guide on Prop 42, stating it is a direct countermeasure to Prop. 40. Click provided the following statement in full:
- "California's Constitution currently allows the Legislature to impose taxes on personal property such as retirement accounts, pensions, 401(k)s, IRAs, bank accounts, and other personal savings. In recent years, lawmakers have introduced five separate proposals to tax retirement savings and other personal property. These attempts underscore that this authority already exists and has been tried repeatedly. We do not think the Legislature should be able to tax retirement savings or other personal property. Prop 42 closes this loophole in California's Constitution to prevent these types of taxes in the future. Prop 40 is just the latest example of this emerging threat. That’s why Prop 42 was crafted to prohibit any taxes on Californians’ retirement accounts, whether proposed by the Legislature or by ballot initiatives like Prop 40. It provides long-term protections against retirement taxes, regardless of how Prop 40 turns out. Prop 42 protects Californians against the much broader problem of politicians trying to tax their retirement and personal savings."
Bell told KSBY News, "If you can get diverse groups of people who seem to represent a broader segment of the public than just wealthy people, that's a win for you, and so that's what they do."
Prop. 42 contains language that reads, "The provisions of the other measures shall be null and void." Bell said the measure would only need to receive one more vote than Prop. 40 to outrank it.
"Prop. 42 would prevail and Prop. 40 would not take effect if that occurred," he said.
Bell also told KSBY News it is not uncommon for opponents of a ballot measure to place a competing measure on the ballot that sounds equally or more compelling to a wider audience. In this case, the Prop. 42 campaign has the backing of firefighters, building trades, and some veterans' groups. Building trade groups therefore also oppose Prop. 40, the California Billionaire Wealth Tax.
Bell said that builders are the same people whose income relies on the properties higher-income earners live or work in.
"Their reason for it is Prop. 40 may be a tax on the wealth of billionaires, but it's absolutely a job killer and will cause businesses that have already been fleeing California in droves to do even more," he said.
"[Prop. 42] sounds every bit as good, maybe better, more alarming than the other measure and has its own purpose that you can point to positively," Bell said.
Here's the timeline of how the two Initiatives made it to the November 2026 ballot:
- Oct. 21, 2025: Documents from Attorney General (AG) Rob Bonta's office show Prop. 40 proponents submitted the billionaire tax initiative on this date.
- Nov. 24, 2025: Prop. 40 proponents amended their initiative.
- Dec. 26, 2025: AG Bonta issued the billionaire tax's official title and summary.
- Dec. 8, 2025: Prop. 42 supporters filed the initiative paperwork.
- Dec. 26, 2025: The AG issued the formal title and summary for Prop. 40.
- Jan. 12, 2026: Prop. 42's backers filed an amended version, requesting the title: "The Retirement and Personal Protection Act of 2026."
- Feb. 11, 2026: The AG issued Prop. 42's official title and summary, removing the word "Retirement" from the title, which now reads: "Prohibits New State Personal Property Taxes and Certain Retroactive State Taxes."
KSBY News spoke with more than a dozen voters planning to vote in November, all of whom said they were confused by the multiple tax propositions on the ballot.
"I think there probably is some confusion with propositions," said Angie Balderas of Santa Barbara County. "Normally, I ask the people around me what they think about certain propositions."
Dan Weeks of San Luis Obispo said, "I basically look at what multiple newspapers said of what they say and why. When I look at the voter pamphlet, both sides of whatever sound like the world will stop, no matter which direction I vote."
"I honestly don't know much about the tax positions," said new mom Audrey Beckett of Atascadero. "I've seen advertisements online, but I haven't really been following it. I like to do a lot of research to help me investigate kind of what's going on with it and kind of see who's backing each prop and kind of see where my beliefs align."
Mark Furia of San Luis Obispo said he is keenly aware there is a level of marketing and sales that goes on with those who bring initiatives to the ballot.
"It's because they're selling each side, selling something, and you're wondering, you're questioning, what is it really you're selling? And it's hard to even get to the bottom line of who's behind it, who's backing," Furia said.
A Public Policy Institute of California poll conducted in September suggests prospective voters may not understand that voting for both Prop. 40 and Prop. 42 would nullify Prop. 40. The PPIC survey of more than 1,745 California adults, 1,103 of whom are likely voters, found that more than half of those sampled indicated they plan to support all three tax propositions on the ballot:
- 52% would vote yes on Prop. 40.
- 51% support Prop. 41, which would prohibit new state taxes and spending limits.
- 54% support Prop. 42.
PPIC reported a margin of error of 3.8 percentage points.
KSBY News will continue to provide in-depth election coverage and expert analysis before election day on November 3, and continue coverage as results come in throughout the state.
