Had it passed, experts believe it would have been the world’s first wealth tax targeting billionaires.
The tax would have raised about $100bn to make up for federal funding cuts to healthcare in California as a result of President Donald Trump’s sweeping tax and spending bill.
Those who backed the measure had argued it would help ensure that the ultra-wealthy were contributing their fair share and helping backfill gaps in the state’s budget.
The wealth tax faced fierce opposition, including from Google co-founder Sergey Brin, as well as California Governor Gavin Newsom and labour unions.
Some billionaire critics of the measure spent millions trying to crush it, with a handful even moving out of the state to evade the possible tax. Brin gave more than $100m to a political organisation funding ballot measures that could block the tax, according to the Los Angeles Times.
Newsom, whose tenure as governor is coming to an end, had expressed concerns that the measure could cause the wealthy to leave the state and drive out their crucial income tax revenue.
