California lawmakers introduce new ‘wealth tax’ for ultra-rich residents

California lawmakers have introduced new tax legislation for the state’s wealthiest residents.

Spearheaded by Assemblyman Alex Lee, a progressive Democrat representing the state’s 24th district in Northern California, the new legislation would tax an extra 1.5% on residents with a global net worth of $1 billion and include a 1% tax for those making 50 million or more, a news release said.

The proposal aims to tax one’s stocks and bonds, which can accrue additional wealth without being taxed, KCRA reported.

The projected revenue from the new wealth tax would generate $21.6 billion annually, roughly the same amount as the governor’s latest budget deficit, Lee said on Twitter.

“With this modest tax on the ultra-wealthy who pay a lower effective tax rate than the bottom 99%, we would have sustained investments in our schools, tackle homelessness, maintain and expand needed services, and much more,” Lee said in a statement.

The measure has yet to be assigned to any committee or slated to receive a hearing, KCRA reported. The proposed legislation would require a two-thirds majority vote from the state legislature, and voters would ultimately decide its fate during the 2024 election.

California is home to more than a quarter of the U.S. billionaires, according to a news release. Many of the state’s ultra-wealthy residents avoid paying as much taxes as others, usually just paying a tiny portion of their overall wealth, a 2021 ProPublica study found.

Other states, such as Connecticut, Hawaii, Nevada, New York, Maryland, Illinois, and Washington, have introduced similar proposals.

The new wealth tax proposal is also supported by assemblymembers Ash Kalra (D-San José), Corey Jackson (D-Inland Empire), Liz Ortega (D-Hayward), Matt Haney (D-San Francisco), Miguel Santiago (D-Los Angeles), and Wendy Carrillo (D-Los Angeles), and Senators Lena Gonzalez (D-Long Beach), Lola Smallwood-Cuevas (D-Los Angeles), and Maria Elena Durazo (D-Los Angeles).