Odds On: Want to bet on a California wealth tax? Here’s the latest

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BACKGROUND: California’s billionaire wealth tax has emerged as a recurring idea in Sacramento. The core concept is an annual tax on the net worth of the wealthiest residents, separate from income or property taxes. Rather than taxing what people earn in a given year, a wealth tax would be based on the total value of assets such as stocks, private business stakes, real estate, art and other holdings, minus debts. Supporters of the proposal argue that California is uniquely positioned to pursue such a tax because it is home to a large share of the nation’s billionaires. They contend that the ultra-wealthy benefit disproportionately from the state’s economic ecosystem and infrastructure, while much of their wealth grows through unrealized gains that are largely untouched by the existing tax system. Politically, the idea has been championed by progressive lawmakers and advocacy groups, but it faces significant resistance. Critics warn that a wealth tax could accelerate the departure of wealthy individuals and capital from California, undermining the state’s tax base over time. Others point to administrative challenges, especially the difficulty of valuing illiquid assets like private companies or unique collectibles on an annual basis. Legal questions also loom, since any new tax of this magnitude could face constitutional hurdles, require supermajority approval in the legislature, or end up before voters via a ballot initiative. The versions discussed publicly have generally focused on high thresholds, often starting at $1B in net worth, though some ideas have floated lower entry points with progressively higher rates for larger fortunes. A commonly cited structure is an annual tax of around 1% on wealth above the threshold, sometimes with higher marginal rates for extreme levels of wealth. The proposal remains at the discussion and exploratory stage, surfacing in hearings, policy papers and public debate. Whether it advances will depend on budget conditions, public opinion, legal feasibility and the broader political climate in the state. If momentum builds, supporters could seek to place a measure on a statewide ballot in November, making it a direct question for California voters rather than solely a legislative fight.

THE BET: Polymarket offers “Billionaire one-time wealth tax on California ballot?” with a total volume of $47,259.

Traders on Polymarket are pricing in a 59% chance of a billionaire wealth tax appearing on a California ballot initiative. The “Yes” contract was last trading at 60c, while the “No” contract stood at 42c.

Meanwhile on Kalshi, the prop is titled “Will the California billionaire wealth tax appear on the ballot?” with a total volume of $16,072.

Market participants on Kalshi are pricing in a 60% chance of a California ballot initiative for a billionaire wealth tax. The “Yes” contract was last trading at 62c, while the “No” contract stood at 40c.

THE RULES: According to Polymarket, this market will resolve to “Yes” if a ballot initiative is certified to appear on the official statewide California ballot for the November 3 election, that proposes a one-time tax targeting individuals, households, or family units with wealth, assets, or net worth of at least $1B, by the official cutoff date for new initiatives to be approved. Otherwise, this market will resolve to “No”. Certification means the initiative is officially approved by the California Secretary of State for a statewide ballot. The primary resolution source will be official information from the government of California. If unavailable, a consensus of credible reporting may be used.