**Opposition from California Gov. Gavin Newsom and other leading Democrats, combined with over $200 million in spending by opponents including Sergey Brin-funded counter-propositions 41 and 42, has shaped trader expectations that Proposition 40 will fail.** The one-time 5% wealth tax on billionaires resident as of January 1, 2026, faces implementation hurdles, litigation risks, and concerns over long-term revenue loss from tax flight already observed among high-net-worth residents. Recent polling from UC Berkeley IGS and PPIC shows support hovering near or below 52% among likely voters, often narrowing as the November ballot approaches, with the competing measures creating multiple paths for defeat even if Prop 40 secures a plurality. These dynamics, including divided Democratic support and business pushback, underpin the 69.5% implied probability against passage.