California entrepreneur warns billionaire wealth – Business News
California entrepreneur Eric Schiffer warned that the state’s proposed billionaire wealth tax may drive some of its most profitable business leaders out of California, predicting a “giant sucking sound” of entrepreneurs heading for the exits if voters approve the measure.
Schiffer, chairman of household workplace Patriarch and CEO of Reputation Management Consultants, informed FOX Business that he works with a number of billionaire purchasers, together with some in California, and stated many are sad concerning the proposal.
“I think the impact of this passing in California is a giant sucking sound of all of these entrepreneurs being sucked out of California because they’re just not going to want to stay,” Schiffer stated.
“Why would anyone stay if they have spent their life building wealth that they were already taxed on?” he continued.
“You’re going to see some of the most brilliant, most successful men and women that have been the cornerstone of tax revenue and donational revenue and leading companies that are employing fleets of individuals and scores of individuals, they’re going to say, ‘No mas, I’m out. Goodbye,’ because they don’t feel respected or appreciated and they feel under attack,” Schiffer stated.
Proposition 40, which is on the Nov. 3 poll in California, would impose a one-time tax equal to five% of web price on billionaires who have been California residents on Jan. 1, 2026.
California entrepreneur Eric Schiffer warned that the state’s proposed billionaire wealth tax may drive some of its most profitable business leaders out of California.
The tax can be due in 2027, though funds might be unfold over 5 years at an extra price. Real property, pensions and retirement accounts typically can be excluded from the tax.
The measure has been endorsed by the California Democratic Party, whereas some notable leaders, together with Gov. Gavin Newsom, have expressed opposition.
California Republican gubernatorial candidate Steve Hilton has additionally warned that the billionaire tax would additional pressure the state’s economic system.
Schiffer argued that the tax may additionally have an effect on Californians with out billion-dollar fortunes, saying the implications may attain their workplaces and financial alternatives.
Supporters maintain indicators advocating for the Billionaire Tax Now coalition during a information convention in Los Angeles, California, Monday, April 27, 2026. Bloomberg by way of Getty Images
“I think some of the consequences, if you’re a working individual in California, is there’s going to be less opportunity,” Schiffer stated.
He argued that if entrepreneurs relocate, the state may lose companies, jobs, investment and tax income.
“If you think California, when you have all these billionaires bolt, isn’t gonna hurt and isn’t going to create problems and isn’t going to reduce tax revenue and reduce jobs, boy, you’re smoking some of the stuff that they’re selling in California in some of these stores,” he stated.
Schiffer additionally argued that the state may ultimately search to impose related taxes on people with smaller fortunes.
“If they’re going after billionaires, then the next thing is they’re going after you if you’re worth hundreds of millions of dollars,” he stated.
U.S. Representative Ro Khanna, Democrat of California, speaks after listening to U.S. Secretary of Commerce Howard Lutnick testify during his closed-door deposition earlier than the House Committee. Ron Sachs – CNP for NY Post
California’s nonpartisan Legislative Analyst’s Office stated “some billionaires” might resolve to depart the state in response to the tax, taking with them the income tax income they at the moment generate.
The LAO estimates these and different behavioral responses may scale back state income tax income by much less than $1 billion per yr. At the identical time, it estimates the wealth tax would quickly generate tens of billions of {dollars} over a number of years.
FOX Business requested Schiffer immediately whether or not he would depart California if the coverage ultimately expanded past billionaires.
“If it got to the point where they’re talking about people that may be worth more than a couple hundred million dollars in that range, California, unfortunately, would be in my rearview mirror,” Schiffer stated.
Billionaire Mark Cuban has individually argued that billionaire founders could be “cash poor, stock rich” as a result of a lot of their web price can consist of company shares fairly than money out there to pay a wealth tax.
California Gov. Gavin Newsom meets Union County voters amid exterior Trump-supporting protesters at a Labor Day weekend rally in Monroe, North Carolina, Saturday, Sept. 5, 2026. Anadolu by way of Getty Images
Schiffer made a related level, saying some billionaires maintain a lot of their wealth in stock, together with shares of personal corporations.
Rep. Ro Khanna, D-Calif., one of the proponents of the wealth tax, has beforehand argued that the levy would help protect health take care of working-class Californians. He additionally stated the “Sacramento establishment” and lobbyists opposing the measure have been “blatantly out of touch.”
Schiffer argued that the bigger query is what the proposal tells people making an attempt to construct corporations and accumulate wealth in California.
“You’re changing the contract that America has sent to entrepreneurs,” he stated. “And you’re saying, this isn’t a good place to do business.”
“What we don’t want to ever do is to lose the immense power and immense creative engines that the greatest entrepreneurs in the world continue to generate on behalf of the United States of America,” Schiffer added.
