Economy

New Data Shows Migration to Texas as California Weighs Retroactive Billionaire Tax

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Jan 8, 2026

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A newly released growth index based on rental truck transactions identifies Texas as the top state for inbound migration in 2025, marking the seventh time in a decade the state has held the position. According to U-Haul data derived from over 2.5 million one-way trips, Florida, South Carolina, North Carolina, and Tennessee rounded out the top five growth states. Conversely, California ranked last on the index, joining Massachusetts, New York, Illinois, and New Jersey in the bottom five.

Commentary analyzing the data suggests the trend reflects a shift toward states with lower tax burdens and costs of living. This migration discussion coincides with a push by the Service Employees International Union-United Healthcare Workers West to place a "Billionaire Tax Act" on California’s November general election ballot. The measure proposes a one-time 5% tax on the net worth of residents holding $1 billion or more in assets.

The proposed legislation includes a provision making the tax retroactive to individuals residing in the state as of the beginning of 2026. The union stated this start date was selected to ensure wealthy residents cannot avoid the tax, which they estimate could raise $100 billion for healthcare services. However, reports indicate California Governor Gavin Newsom is coordinating efforts to defeat the measure. Legal analysts have also warned that the retroactive nature of the proposal would likely face significant challenges in court regarding due process.

The potential tax has drawn varied responses from the business community. Tech investor Peter Thiel recently highlighted his residency in Miami, and Oracle founder Larry Ellison reportedly sold his San Francisco estate in December, a move observers noted would avoid the tax liability. In contrast, Nvidia CEO Jensen Huang stated he is "perfectly fine" with the proposal. While attorneys note that establishing new tax residency is legally complex, tax advisors in the state have reportedly seen an increase in demand.

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• Correlation with outbound migration trends Commentary analyzing recent U-Haul growth index data suggests that current migration trends reflect a shift toward states with lower tax burdens and living costs. While Texas ranked first for inbound migration for the seventh time in a decade, California ranked last on the index alongside other states like New York and New Jersey.

• Legal and political opposition to the measure Reports indicate that California Governor Gavin Newsom is actively coordinating efforts to defeat the ballot measure. Additionally, legal analysts have warned that the retroactive nature of the tax is likely to face significant court challenges regarding due process rights.

• Evidence of high-net-worth relocation Observers noted that recent real estate moves by prominent figures, such as Larry Ellison selling his San Francisco estate and Peter Thiel highlighting his Miami residency, allow them to avoid the potential tax liability. Consequently, tax advisors in the state have reportedly seen an increase in demand as wealthy residents navigate the complexities of establishing new tax residency.

How it may affect me

As a U.S. reader:

• Residents in Texas, Florida, and the Carolinas may see increased demand for local services and housing as these states continue to lead the nation in inbound migration.

• California communities could see roughly $100 billion in new funding dedicated to healthcare services if the proposed tax on assets over $1 billion is approved by voters.

• Legal battles regarding the retroactive nature of the proposed tax could set significant court precedents regarding due process and the ability of states to tax past residency.

• States receiving wealthy migrants may experience economic shifts as high-net-worth individuals sell assets in high-tax jurisdictions to establish residency elsewhere to avoid potential liability.

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