San Jose Mayor Opposes Billionaire Tax Idea

San Jose Spotlight

January 7, 2026

San Jose Mayor Matt Mahan has come out against a controversial proposal to create a “billionaire tax” in California. Backers see it as a means of filling a massive deficit facing the state’s health care system.

In a nearly 300-word thread posted to X Monday, Mahan warned if passed by voters, the pending statewide ballot measure would drive wealthy entrepreneurs out of California, sapping the state’s tax base and undermining its economic dynamism.

“We need a rising economic tide to lift all boats, not a political plan that will sink California’s innovation economy,” Mahan wrote.

The post is just the latest example of Mahan chiming in on a hot-button statewide policy issue, amid speculation that he is considering a run for governor this November. The mayor’s office has consistently downplayed such rumors.

The proposed measure would impose a one-time, 5% wealth tax on about 200 Californians who hold more than $1 billion in assets, backers said.

The October announcement of the ballot measure campaign has set off a political firestorm that has only intensified with time. In recent weeks, a number of wealthy Californians have responded with threats to move their homes and assets to other states. Meanwhile, prominent California Democrats have staked out opposing positions on both sides of the issue.

While Gov. Gavin Newsom has come out firmly against the tax, South Bay Congressman Ro Khanna has become one of its most vocal supporters.

“We believe billionaires can pay a modest wealth tax so working class Californians have the Medicaid your party cut,” Khanna wrote in an X post responding to criticism from Republican Sen. Ted Cruz of Texas.

Khanna is referencing pending cuts that stem from President Donald Trump’s One Big Beautiful Bill. In California, the state stands to lose $30 billion each year from the measure, resulting in 3.4 million people losing Medi-Cal coverage, according to estimates from The California Budget & Policy Center. The campaign behind the wealth tax — led by Service Employees International Union-United Healthcare Workers West (SEIU-UHW), a major statewide health care union — said the $100 billion in projected revenue from the measure would provide a crucial buffer against those looming cuts.

Supporters must collect nearly 850,000 signatures by June 24 for the wealth tax to qualify for the November ballot.

Khanna’s outspoken support for the billionaire tax has earned him fierce rebukes from a number of tech industry leaders, a constituency the Silicon Valley representative has generally counted among his reliable supporters. Mahan’s series of X posts does not refer to Khanna.

Khanna’s office did not respond to a request for comment. A representative for Mahan declined to provide further comment beyond the mayor’s X posts.

Mahan’s posts warned an exodus of wealthy entrepreneurs would devastate California’s tax base — which is heavily reliant on high-income earners — leaving middle-class working households to “pick up the tab.”

“I realize no one has sympathy for billionaires. But the truth is — they don’t have to, and many won’t, stay here if this tax is implemented,” Mahan wrote. “The people who lose in the long run are California families who will be asked to foot more of the bill for government services and infrastructure.”

Responding to Mahan’s comments, a spokesperson for SEIU-UHW accused the mayor of misunderstanding the underlying funding problem the proposed tax is intended to solve.

“He must be misinformed — because the goal of this measure is to save hospitals and keep ERs open, prevent higher health care costs, and protect health care for all Californians, including children, seniors and people with disabilities,” Suzanne Jimenez, the labor organization’s chief of staff, told San José Spotlight. “Without this measure, higher health care costs will be shifted onto millions of Californians, many of whom are already struggling with skyrocketing health care and prescription costs.”In his posts, Mahan — who recently launched a statewide Back to Basics initiative focused on promoting “common sense” policy fixes to the state’s problems — also questioned the efficacy of imposing a new tax. He argued that before taking this step, California should first do more to crack down on “waste, fraud and abuse” in the health care system and state government.

“Income inequality is a very real issue and we need to address it with real solutions — like closing the massive loopholes nationally that allow the wealthiest among us to essentially never pay taxes on many capital gains,” he said. “But for California to go it alone will be a disaster.”

Contact Keith Menconi at keith@sanjosespotlight.com or @KeithMenconi on X.

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