Not only has Gov. Gavin Newsom vocally opposed the proposed California billionaire tax, but he also wants to prevent the state from ever passing a wealth tax in the future.
On Friday he endorsed Proposition 42, a ballot measure that would cancel out Proposition 40, the proposed billionaire tax. Prop. 42 would prohibit retroactive taxes like the one-time 5% tax on assets that would apply to any billionaire who lived in California on Jan. 1, 2026 if Prop. 40 passes.
But Prop. 42, funded and placed on the ballot by billionaire and Google co-founder Sergey Brin to defeat the billionaire tax, also would go further, by banning any new taxes on personal property.
That includes pensions and 401K accounts before retirees start drawing retirement income from them. It also includes other investments, financial assets, business holdings, art collections and all other forms of personal wealth that would be affected by the billionaire tax or any future wealth tax.
Newsom’s decision to support Prop. 42 runs counter to his own Democratic Party and some labor unions. It also aligns him with some of the wealthy tech donors with whom he’s maintained longstanding relationships dating back to his days as mayor of San Francisco.
Eh… yes and no. But we’ll get to that.
To answer your question, there’s a principle in legal philosophy called the rule of recognition, which, basically, describes how a court determines what the law is.
The US constitution is considered the highest law of the land, and describes the process by which legislation has to be passed (usually by simple majority vote) by Congress and the Senate and assented to by the President before it becomes statutory law. It also describes the process by which the constitution itself can be amended, which is a much more stringent process. Basically, an amendment must be proposed and than accepted by either a national convention (which has never even been tried) or by being passed by a 2/3 majority vote in both the Congress and the Senate. It then has to be ratified by at least 3/4 of the states. Further, it also contains some amendments that limit what statutory law can do.
So the rule of recognition in the US is, basically, is the law constitutional? Which is to say, is the legislation enacted according to the rules in the constitution, and not invalidated by any of limits set out in the constitution? And if the answer to that question is “no” then the court will disapply that law. If legislation was passed saying slavery is legal again then, in theory at least, the court would say “no, there is a constitutional amendment that says slavery can’t be legal, this is not good law”. The only way to override that would be to pass a new amendment to remove that amendment. And unless the new amendment is passed according to the rules laid out, the courts would not recognise it. So in this way, the US legislature has very much been bound.
The fundamental principle of UK’s constitution, on the other hand, is that the King-in-Parliament has absolute sovereignty. Now, while this is certainly acknowledged in legislation and lots of court decisions, it isn’t written down in the sense that there is a clear definition of what that means.
The rule of recognition is generally taken to be that an Act passed by Parliament and given royal assent is the law, no matter what it says, and is the highest form of law in the land. To see an example of how seriously that is taken, see the mess that is the Human Rights Act 1998 and its “declaration of incompatibility” apparatus, which exists because courts cannot disapply an Act of Parliament. (To be clear I’m in favour of the European Convention/Court of Human Rights, I just think the HRA is massive bodge (precisely because our constitution is the way it is).) To see an example of how flexible it can be when it comes to interpreting Acts of Parliament, see the Metric Martyrs case decision.
It is an open questions as to what extent, if any, Parliament can bind itself because it’s unclear what a court would do if an Act of Parliament was given royal assent despite the fact a previous Act of Parliament technically says it shouldn’t have done. And to avoid a constitutional crisis, Parliament, by convention, doesn’t try.