Mark Cuban’s Arguments Against The Proposed 5% CA Wealth Tax
Cuban said the proposal could force founders to sell illiquid stakes and may reduce revenue, while Khanna said 72% of targeted wealth is publicly traded stock.
- On Monday, August 17, 2026, billionaire investor Mark Cuban and Representative Ro Khanna debated California's Proposition 40, a proposed 5% wealth tax on billionaires, during a CNBC segment hosted by Andrew Ross Sorkin. The clash revealed fundamental disagreements over asset liquidity and capital flight risks.
- Proposed by the Service Employees International Union-United Healthcare Workers West, Proposition 40 aims to address California's projected multibillion-dollar budget deficit with a one-time 5% tax on net wealth exceeding $1 billion. The measure directs 90% of revenue to state healthcare programs.
- Arguing that founders are 'cash poor, stock rich,' Cuban challenged the tax's feasibility, questioning how founders could access funds to pay without a market to sell into. Khanna countered by suggesting the state provide non-recourse loans, enabling founders to borrow against company ownership to settle the levy.
- Opponents, including Google co-founder Sergey Brin, have donated more than $100 million to defeat the measure, fearing it will drive startups and investment from California. Cuban warned he would steer new companies away if voters approve the tax.
- Voters will decide the proposal's fate this November alongside rival Propositions 41 and 42, designed to nullify it if they receive more votes. California's technology and professional services sector represents 21.7% of state GDP, making the outcome consequential for the broader economy.
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22 Articles
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Mark Cuban challenges California wealth tax over founder cash constraints
California’s proposed billionaire wealth tax is turning into a broader argument over how the state should treat wealth that exists mainly on paper rather than in cash. The dispute between Mark Cuban and Rep. Ro Khanna centers on Proposition 40, a proposed one-time 5% wealth tax on California residents with more than $1 billion in assets. The California Democratic Party has endorsed the measure, while Gov. Gavin Newsom has opposed it. Cuban’s cri…
Cuban Warns Wealth Tax Could Push Capital Out Of California
Jan 19, 2026; Miami Gardens, FL, USA; American businessman and television personality Mark Cuban before the College Football Playoff National Championship game at Hard Rock Stadium. Mandatory Credit: Mark J. Rebilas-Imagn Images(Sacramento, CA) – Mark Cuban is
What business leaders are saying — and doing — about California's proposed billionaire tax
Jensen Huang, Mark Cuban, and Sergey Brin have all commented on California's wealth tax proposal.Tomohiro Ohsumi/Getty Images; Peter Joneleit/Icon Sportswire via Getty Images; Phillip Faraone/VF25/Getty Images for Vanity FairWealthy business leaders have come out for and against the California wealth tax proposal.State labor groups proposed a 5% tax on California residents with assets exceeding $1 billion.Mark Cuban said that only "idiot startup…
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