Meta Platforms and Mark Zuckerberg have found a way to keep the CEO in California despite concerns about a wealth tax on the state’s ballot this November.
Mr. Zuckerberg will be eligible for a new class of stock shares that he could sell to satisfy a potentially massive tax bill if voters approve the 5% tax known as Proposition 40.
Mr. Zuckerberg agreed to remain a resident of California, or any place Meta maintains its headquarters, for eight years.
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The Meta CEO is one of the world’s wealthiest people. He’s also among the 200-plus California billionaires who would face the proposed tax.
Sen. Bernard Sanders, the Vermont independent and hero to the hard left, and certain labor unions support the wealth tax. The proposal faces resistance from wealthy tech CEOs and Gov. Gavin Newsom, a Democrat who would prefer a nationwide billionaire’s tax.
Mr. Zuckerberg could sell a portion of his new “Class C” shares to foot his hefty tax bill without losing voting control in his company. He could also leverage stock shares for other purposes, such as funding his charitable foundation.
In company filings, Meta stressed that its Class C shares are part of a broader strategy.
The shares will help Meta “finance its growth and help the company remain a leader among fierce competition both domestic and international” during the artificial-intelligence boom, the company said.
Meta also said it was important for Mr. Zuckerberg to work closely with California operations.
“The Special Committee affirmed its belief that it was important for Mr. Zuckerberg to continue to lead the Company from California, including because it was crucial that Mr. Zuckerberg remains in close coordination with the Company’s management and in close proximity to Meta Superintelligence Labs,” the company said in filings.
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