A proposed one-off 5% tax on billionaires' wealth, which California voters will decide on next month, could end up costing the state money, according to a working paper by Stanford economists Benjamin Jaros and Joshua Rauh, CBS News reports.
The paper, published by the National Bureau of Economic Research, says seven billionaires, including Peter Thiel, Larry Page and Sergey Brin, have already publicly moved away, taking about $540 billion, or 30% of the state's billionaire wealth, out of reach. It estimates the tax may raise about $30 billion rather than the $100 billion its backers expect, while the state could lose $1 billion to $3.5 billion a year in income tax.
The healthcare workers' union behind the measure, SEIU-UHW, did not immediately comment. Other economists, including Daron Acemoglu and Joseph Stiglitz, have reached different conclusions.
Source: CBS News
