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Proposition 42

Prohibits New State Personal Property Taxes and Certain Retroactive State Taxes

On the ballot

California · November 2026 general election · Constitutional amendment · Election day November 3, 2026
Topics: Taxes and revenue

In plain language

Proposition 42 would prohibit new state taxes on the ownership of personal property, including business interests, intellectual property, and financial assets such as the holdings in retirement and investment accounts. California currently taxes some personal property, such as vehicles and business equipment, but does not tax the ownership of financial assets. The measure would also prohibit new state taxes that apply retroactively based on conduct, activities, or status occurring before the tax took effect. It would apply to new taxes enacted or taking effect on or after January 1, 2026, and would void a conflicting measure on the same ballot that receives fewer votes.

Fiscal impact

Legislative Analyst's Office summary of the estimate of net state and local government fiscal impact: "Possibility that tax revenues will not go up as much in the future." The LAO states the measure restricts the state's future options for raising taxes, which could reduce future tax revenues by an amount and on a timeline that are unclear.

Summarized from the official fiscal analysis listed in the sources below. Figures are the state's, not this site's.

What supporters and opponents say

These are summaries of arguments made by the named organizations, drawn from the sources listed below. They are their claims, not this site's, and this site takes no position on the measure.

What supporters say

  • The ballot argument signed by Michael Hedges (California Small Business Association), Shelley Huff (AMVETS, Department of California), and Jennifer Yoder (California Senior Alliance) says the measure would protect 401(k)s, pensions, IRAs, and personal savings from new taxes.
  • Chris Hannan of the State Building and Construction Trades Council of California is quoted in the argument saying new taxes on retirement should not stand between people and the security they have planned for.
  • Supporters state in the official argument that roughly 80 percent of Californians report having some form of retirement fund or savings, and describe the measure as barring what they call double taxation of money already taxed as income.

Attributed to California Small Business Association, AMVETS, Department of California.

What opponents say

  • The ballot argument signed by Suzanne Jimenez (SEIU-United Healthcare Workers West) says Proposition 42 is a billionaire-funded measure written to cancel out Proposition 40, the billionaire tax on the same ballot, rather than to protect ordinary retirement savings.
  • Opponents state in the official argument that Proposition 40 would tax only billionaires’ wealth and that claims about ordinary retirement accounts being at risk are fear-mongering, and urge a "no" vote from anyone who supports the wealth tax.

Attributed to SEIU-United Healthcare Workers West.

Sources

Everything on this page traces to these sources. Follow them to read the original documents.

Last updated . How this page is sourced and corrected is described in the correction policy.