The act itself recognizes billionaires’ ability to evade taxation: “A large percentage of billionaire wealth is never taxed by the State due to billionaires’ unique ability to control the timing, location, and amount of income tax that they pay.” This tax avoidance is exactly what has happened since the ballot measure was submitted.
Importantly, the tax conflates voting shares with equity, as Garry Tan, president and CEO of venture capital firm Y Combinator, recently explained on X. This means that under the law, Google co-founders Larry Page and Sergey Brin—who each possess 30 percent of the voting rights in Google, but only own 3 percent of its equity—would have to pay a 5 percent tax on the value of their voting control. Tan estimates that this figure would come to about $60 billion each, and in order to pay this, both Page and Brin would have to liquidate 50 percent of their Google shares. The two co-founders recently fled the state to avoid this potential penalty.