Chamath Palihapitiya Says People Worth $500 Billion 'Scrambled And Left California' Over Billionaire Tax, Warns That It Will Deepen Budget Deficit

Venture capitalist Chamath Palihapitiya says a projected California billionaire taxation is already driving ultra-wealthy residents retired of the state, a determination helium warns could worsen the fund shortage alternatively than hole it.

On Thursday, Palihapitiya took to X that radical helium knows with a combined nett worthy of astir $500 cardinal moved to permission California permanently aft the authorities floated a projected "billionaire tax," which helium described arsenic an plus seizure-style levy.

“People I know, with a corporate nett worthy of $500B, scrambled and near California for bully yesterday,” helium wrote.

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According to Palihapitiya, those individuals chose to exit instantly alternatively than hazard being taxable to the tax, arguing the authorities could yet cod little gross arsenic a result.

He warned that losing high-net-worth residents would lone grow California's fund deficit, forcing lawmakers to trust connected further borrowing oregon broader taxation hikes.

"Without these people, the California fund shortage volition lone get bigger," Palihapitiya wrote, adding that the load would apt autumn connected mean taxpayers if affluent residents depart.

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Palihapitiya, previously, besides criticized the proposal, arguing that the taxation unfairly targets unrealized and illiquid wealth, peculiarly among startup founders.

He said entrepreneurs often gain humble salaries portion holding ample equity stakes that cannot easy beryllium converted into cash.

In 1 example, helium described a laminitis with astir $1.2 cardinal successful insubstantial equity earning a $150,000 salary, who could beryllium forced to travel up with tens of millions of dollars successful currency nether the proposal.

If the institution aboriginal mislaid value, Palihapitiya warned, the taxation work would stay unchanged, perchance leaving the laminitis insolvent.