Utah weighs a 60% threshold for tax initiatives as California considers taxing billionaires

KEY TAKEAWAYS

• Utah lawmakers propose a constitutional amendment requiring a 60% vote to pass tax initiatives.
• The amendment aims to prevent special interests from easily influencing tax policies.
• Critics argue it limits voter power; supporters say it protects economic stability.

SALT LAKE CITY — As California voters consider implementing a one-time 5% tax increase on billionaires, Utah lawmakers are asking Utahns to make it harder for voters to pass ballot initiatives that change how much people pay in taxes.

The constitutional amendment, approved by Utah's Republican-controlled Legislature in 2025, would increase the threshold for citizen-proposed legislation to become law, from a bare majority of 50% plus one to 60%.

A "Vote No" campaign organized by the groups behind Utah's redistricting initiative argues the amendment would remove an important tool for voters to hold government officials accountable when they feel they have been ignored.

But proponents of the amendment point west to California where ballot initiatives have taken over policy discussions.

The upcoming midterm elections will give California voters the chance to decide whether to approve a ballot initiative that seeks to temporarily make up for lost federal healthcare subsidies but could harm an already beleaguered budget.

If approved, California's Proposition 40 would impose a single-year wealth tax on the 200-250 residents with a net worth north of $1 billion. Supporters claim the rate increase would bring in $100 billion for public healthcare programs.

While taxing the ultra-wealthy appeals to many, it will likely bring in much less because billionaires will leave the state, decreasing future revenue, according to Wayne Winegarden, senior economics fellow at the Pacific Research Institute.

Citizen ballot initiatives wreaked havoc on California's public coffers long before the billionaire tax was proposed.

The underlying problem going back decades, Winegarden said, is the ability for special interests to lobby in favor of tax increases that benefit themselves. Proposition 40 was sponsored by a union representing healthcare workers.

"They tie the budget up in knots and the Legislature can't control the budget," Winegarden told the Deseret News. "Where you get into trouble, and where California gets into trouble, is when you start doing the job of the Legislature."

Utah's amendment proposal is an example of where ballot initiatives can serve to safeguard the legislative process, Winegarden said. Just as lawmakers need institutional checks, so do voters when it comes to levying taxes.

Making Utah initiatives harder

In California, if lawmakers want to refine or repeal a citizen ballot initiative, they have to pass another law that must be approved by voters in another election, giving ballot initiatives the weight of a quasi-constitutional amendment.

Utah has no such requirement; lawmakers traditionally have been able to refine initiatives to fit the constraints of state spending priorities. But the sponsor of "Amendment B" is worried court rulings have made Utah more like California.

The Utah Supreme Court ruled in 2024 that the state Constitution prohibits legislators from changing voter-approved legislation that alters the structure of government unless they meet the highest level of legal proof.

Courts have since interpreted it to mean almost any change, according to state Sen. Lincoln Fillmore, R-South Jordan.

"At this point, the only standard the legislature has to go on is citizen initiatives are untouchable because nobody knows what it means to alter or reform government," he told the Deseret News. "The Supreme Court simply didn't define it."

If groups come into the state wanting to expand government programs, Fillmore said they will need to identify spending cuts to pay for it, or do the extra work to create consensus among a super-majority of voters to increase taxes, he said.

Fillmore's Democratic colleagues see this interpretation as an exaggeration.

Citizen initiatives are already much more difficult to get on the ballot in Utah than in places like California, hence they are much more rare in the Beehive State, state Senate Minority Leader Luz Escamilla, D-Salt Lake City, told the Deseret News.

Legislators can still engage in the legislative process to improve initiatives after voters have made their voices heard, just as they did when medical cannabis and Medicaid expansion were passed by voters in 2018, she said.

"I just don't see what the problem is," Escamilla said. "Now, if you go outside to actually change the intent, to repeal or completely change what was passed by the people, I think that's where we see those legal challenges."

Utah is not California

For those who support the ballot initiative process, 2018 was a big year. Not only was medical cannabis legalized and Medicaid expanded for incomes up to 138% of the poverty level, voters also approved redistricting guidelines.

But while the legislature adjusted the first two policies, they replaced "Proposition 4″ with a commission whose recommendations and anti-gerrymandering criteria had no bearing on what election boundaries were actually chosen.

The League of Women Voters of Utah successfully sued the state over the repeal of a citizen ballot initiative, resulting in court decisions that gave Proposition 4 protections similar to those enjoyed by initiatives under California law.

Ballot initiatives are an essential right to force lawmakers' hand when they ignore the people, according to league president Katharine Biele. Amendment B is just another attempt by the Legislature to restrict voters' power.

"This is their argument that 'We are smarter than you, you stupid constituents,'" Biele told the Deseret News. "Constituents do take the time to research their ballots. We do not put forth initiatives without thinking."

The organization behind the million-dollar campaign to oppose Amendment B says the legislative effort has nothing to do with taxes: it is about avoiding accountability from voters who are dissatisfied with elected representatives.

It is inaccurate to say ballot initiatives in deeply conservative place like Utah will "bankrupt the state," said Scott Cuthbertson, the self-described "fiscally conservative" spokesperson for the "Vote No" campaign.

In response to recent court losses, Amendment B appears more like a "power grab" by a Legislature who does not want to hold themselves to the same 60%-threshold that they want to impose on voters, according to Cuthbertson.

"It's a false framing that the Legislature is putting forward," Cuthbertson told the Deseret News. "I think it's because they have been out of step with the voice of the people in recent years. And so that's really where this is coming from."

Safeguards for citizen initiatives?

But Amendment B is the kind of backstop taxpayer advocates wish California had put in place decades ago.

By only requiring a simple majority of votes for ballot initiatives to become law, California has watched as the budget has become harder to manage, according to Marc Joffe, a visiting fellow at the California Policy Center.

A 1988 initiative, for example, altered the structure of government to ensure that 40% of all general fund revenue has to go to education. This has contributed to a cycle of rising taxes in an already high-tax state, Joffe said.

If anything, Amendment B will discourage groups receiving significant state money from expending resources to convince voters to increase their own funding streams through ballot initiatives, he told the Deseret News.

"It's something that's going to protect Utahns from powerful special interests trying to raid their pocketbook," he said. "If it passes, it will lead to Utah continuing to outperform most states in terms of economic vitality."

Ballot initiatives can be an easy way for unwise ideas to get on the ballot, according to Kristian Fors, an economic analyst at the Utah-based Libertas Institute whose research previously focused on California public policy.

California's Proposition 40 was funded by healthcare unions and inspired by the work of two French-born professors. Opposition to Utah's Amendment B is largely funded by pro-abortion advocates, unions and left-leaning nonprofits, according to the state's disclosure data website.

Amendment B might not seem necessary since Utah is a low-tax state with a strong economy, but that could change in just a few decades if lawmakers pass bad policy or are bypassed by initiatives, Fors told the Deseret News.

"You don't necessarily know what it's going to be like in the future," he said. "It's very important to instill safeguards into the law to make sure that the principles that we value today continue to affect Utah productively in the future."

Amendment B will appear on the ballot for all registered voters. The text of the change can be found here.

The Key Takeaways for this article were generated with the assistance of large language models and reviewed by our editorial team. The article, itself, is solely human-written.

Related topics

UtahU.S.