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Mark Zuckerberg’s creative plan to pay California’s proposed billionaire tax without losing control of Meta
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- DeepHorus
Meta’s board has approved Class C nonvoting stock, effective in January, to fund capital raising, employee pay, acquisitions, and AI while preserving CEO Mark Zuckerberg’s roughly 60% voting control. The shares carry ownership stakes but no votes on company decisions. Meta says the structure will not alter any shareholder’s voting power.
The New York Times reported another motive: helping Zuckerberg pay California’s proposed Proposition 40. The one-time 5% wealth tax on several hundred California billionaires was drafted by Berkeley tax law professors and sponsored by SEIU United Healthcare Workers West. Backers say it could raise up to $100 billion over five years for healthcare, food assistance, and education.
Meta will issue one Class C share for every Class A or B share, a one-time dividend equivalent to a two-for-one split. An SEC filing says Zuckerberg may immediately sell or transfer up to 20% of his Class C shares—10% of his economic stake—including to pay potential Prop 40 liability. The dividend is designed to preserve existing voting control.
The filing shows Zuckerberg discussed the tax with directors from July through August. The Times reported that in September he warned he would list his Palo Alto property for sale if no plan emerged, risking a media firestorm. Meta’s special committee said keeping Zuckerberg in California was important for coordination with Meta Superintelligence Labs.
Zuckerberg’s potential tax bill has been estimated at as much as $11 billion. Prop 40 has drawn fierce Silicon Valley opposition, including campaigning by Google co-founder Sergey Brin. Critics claim the measure could drive wealthy residents and businesses from California.
If approved, Meta’s Class C shares would give Zuckerberg a mechanism to cover the tax while retaining majority control. The plan may sharpen debate over founder power and billionaire taxation. Voters have not yet decided the measure.
