Silicon Valley is taking a more active role in California’s upcoming governor’s race and ongoing debates over wealth taxation.
The region, known for its technological innovation and economic influence, has historically focused less on state government compared to other major sectors. However, recent efforts to regulate artificial intelligence and proposals for new taxes have prompted Silicon Valley leaders to build campaign funds aimed at electing supportive legislators and opposing measures such as a proposed wealth tax.
Two prominent Democratic candidates are expected to attract significant financial backing: billionaire investor Tom Steyer and San Jose Mayor Matt Mahan. Steyer is seeking support from the party’s left wing by endorsing higher taxes on corporations and wealthy individuals, including a proposal to modify Proposition 13 through a special election. According to Steyer, cuts in federal aid require new sources of revenue: “We really can’t wait (…) We’re on the clock. And so, yes, the only way to pass that is with a special election,” Steyer told Politico.
Mahan has rejected Steyer’s tax plan, calling it “the wrong approach.” He has also joined Governor Gavin Newsom in opposing the proposed wealth tax, arguing it could drive wealthy residents out of California.
As Newsom’s term nears its end and the Democratic Party shifts further left, Silicon Valley’s increased engagement may influence both policy outcomes and the selection of the next governor. The region’s response comes as technology creators’ personal wealth remains a crucial source of state revenue, with the top one percent generating nearly half of California’s personal income taxes.
