The California billionaire tax is headed to the ballot. The ultrawealthy are bracing for what comes next.

The proposed billionaire tax is set to appear on the California ballot in November.Caroline Brehman/Bloomberg/Getty ImagesCalifornia's proposed billionaire tax is headed to the ballot in November.Billionaires are bracing for the possible 5% tax, and could leave the state even if it doesn't pass.

The measure is expected to draw a pricey campaign fight and, if passed, legal challenges.The California wealth tax is one step closer to becoming reality.The proposed tax measure, which would require billionaires to pay a one-time tax equal to 5% of their net worth, will appear on the ballot in November after opponents, including Gov.

Gavin Newsom, failed to cut a deal with the union behind it before the June 25 deadline.Now the 200-plus billionaires in California — which has more of them than any other state and most countries — are facing the reality that the tax could become law.The ballot measure is expected to spark a pricey campaign fight and likely legal challenges, as Newsom and others have vowed to continue fighting it.

Advisors to the ultrawealthy say their clients are already bracing themselves for the wealth tax, and that billionaires are making moves out of California regardless of the outcome of the ballot measure."The cat's out of the bag," David Lesperance, a lawyer who advises the ultrawealthy on immigration, citizenship, and taxes, told Business Insider.Lesperance said he had seven clients move out of California before January 1, 2026, as the measure is written to retroactively apply to billionaires who were living in the state as of that date.

Several high-profile billionaires made moves to reduce their California ties ahead of that deadline, including Google cofounders Sergey Brin and Larry Page.Although the tax has been framed as a one-time, 5% tax, Lesperance said his clients "always assumed it wasn't one time, it was the first time." So, even if they're already going to get hit with this tax, they may not stick around to wait for the next one.

Michael Col