{"id":505371,"date":"2026-10-23T12:22:11","date_gmt":"2026-10-23T12:22:11","guid":{"rendered":"https:\/\/www.newsbeep.com\/us-ca\/505371\/"},"modified":"2026-10-23T12:22:11","modified_gmt":"2026-10-23T12:22:11","slug":"zuckerberg-owns-13-of-meta-but-controls-61-of-it-californias-wealth-tax-will-bill-him-on-the-13","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/us-ca\/505371\/","title":{"rendered":"Zuckerberg owns 13% of Meta but controls 61% of it. California\u2019s wealth tax will bill him on the 13%"},"content":{"rendered":"

California voters will decide on Nov. 3 whether the state\u2019s billionaires should pay<\/a> a one-time 5% tax on their net worth. Some of them have already left, like Peter Thiel and Google cofounders Larry Page and Sergey Brin. They join seven billionaires so far who have publicly moved out of the state, taking about $540 billion, or 30% of the state\u2019s billionaire wealth. Meanwhile, others like Jensen Huang are staying.<\/p>\n

Meta\u2019s Mark Zuckerberg looked, up until now, as if he would also join Huang in staying in the state where his company is headquartered. But Meta\u2019s new SEC filing that posted this week shows that\u2019s in part because of the key difference between owning a company and controlling it.<\/p>\n

What he owns and what he controls<\/p>\n

Ownership is a share of a company\u2019s value. Control is a share of its votes. For most shareholders they are the same because each share carries one vote. At Meta, they are not.<\/p>\n

Zuckerberg holds mostly Class B shares, which carry 10 votes each. Ordinary Class A shares carry one. So of every $100 of Meta\u2019s value, about $13 is his, but of every 100 votes, about 61 are his, according to a filing Meta released <\/a>Wednesday. That majority lets him elect the entire board and decide nearly every shareholder vote.<\/p>\n

A wealth tax bills the first number\u2014and to pay it, Zuckerberg would have to sell stock, thereby losing control. When Class B shares are sold, they turn into one-vote Class A shares, so every sale to pay the tax would cut into his control.<\/p>\n

According to the filing, Meta\u2019s board feared that loss of control.<\/p>\n

According to the committee of independent directors that negotiated with Zuckerberg, they found he was \u201cnot on the verge of losing voting control.\u201d But it named the wealth tax as one of the main reasons that could change, saying it \u201chas the most significant impact because it would require him to sell shares, or at least borrow against them.\u201d The filing says he \u201ccould become liable for a significant, multi-billion dollar tax payment based on his ownership of stock in the Company.\u201d<\/p>\n

Zuckerberg also argued that ownership and control don\u2019t need to line up. At an Aug. 26 meeting, he \u201cquestioned why the preservation of the status quo with respect to the ratio of his voting control to his economic interest in the Company should be a consideration for the Special Committee, citing precedent in other companies where relatively small economic ownership nevertheless conveyed founder voting control,\u201d the filing read.<\/p>\n

That\u2019s why the committee proposed in August a dividend of new non-voting stock that would be payable \u201cif, and only if, California Proposition 40 became law and a tax payment by Mr. Zuckerberg became due and payable,\u201d sized to cover his bill. Zuckerberg wanted more, saying \u201che did not wish to go through additional protracted negotiation processes in the future if taxes similar to California Proposition 40 were proposed in other jurisdictions.\u201d<\/p>\n

Under the final deal, which Fortune reported Wednesday<\/a>, every shareholder gets one non-voting Class C share for each share they hold. The committee wrote that Zuckerberg could immediately sell 20% of his new shares, \u201crepresenting 10% of his overall economic stake in the Company, for any reason, including so that he may pay his potential tax liability under California Proposition 40, if enacted into law, without affecting his majority voting control.\u201d Because he takes a $1 salary, the committee said, the tax would otherwise leave him \u201ceffectively be paying to serve as the Company\u2019s chief executive officer while residing in California.\u201d<\/p>\n

The board didn\u2019t want a remote CEO<\/p>\n

Unlike the billionaires who left, Zuckerberg runs a company whose board wanted him in the building. In July, the committee said it was \u201ccrucial that Mr. Zuckerberg remains in close coordination with the Company\u2019s management and in close proximity to Meta Superintelligence Labs.\u201d It said it \u201cwas mindful about the difficulties the Company faced during the COVID-19 pandemic when Mr. Zuckerberg could not be physically present with the Company\u2019s management team.\u201d<\/p>\n

On Sept. 6, Zuckerberg told the committee he \u201cwould need to begin taking steps by mid-September in order to establish residency outside California by mid-October.\u201d The final agreement commits him to stay in California, or wherever Meta is headquartered, for eight years, \u201cabsent material unforeseen circumstances.\u201d<\/p>\n

Meta told Fortune the new stock is mainly about financing its AI spending. In its earnings release<\/a>, the company said the new class would \u201cprovide Meta the ability to finance its growth and help the company remain a leader among fierce competition both domestic and international.\u201d It credits Zuckerberg for Meta\u2019s stock rising more than 1,700% since its IPO, against about 495% for the S&P 500, and says the stock \u201cwill continue the founder-led model that has driven the company\u2019s success since its inception.\u201d<\/p>\n

\u201cWe created this new class of shares with the purpose of creating a publicly traded non-voting stock usable for capital raising, employee compensation, acquisitions, other general corporate purposes while preserving the voting power of existing Class A and B shareholders,\u201d chief financial officer Susan Li said on Wednesday\u2019s earnings call<\/a>. \u201cWe believe this share class will maintain our founder-led structure. It will expand our funding tools and give us flexibility to invest behind the unprecedented momentum we\u2019re seeing across every part of our business driven by AI.\u201d<\/p>\n

The filing<\/a> says management\u2019s forecasts \u201cshowed the Company\u2019s need to raise hundreds of billions of dollars over a period of several years beginning as early as fall 2026.\u201d It also acknowledges the new stock \u201ccould substantially prolong the duration of Mr. Zuckerberg\u2019s voting control of our Company.\u201d Class A shareholders did not vote, because Zuckerberg \u201chas the ability to unilaterally approve\u201d the change.<\/p>\n","protected":false},"excerpt":{"rendered":"California voters will decide on Nov. 3 whether the state\u2019s billionaires should pay a one-time 5% tax on…\n","protected":false},"author":2,"featured_media":505372,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[7,9,8,21163,3412,7037,1694,195330],"class_list":["post-505371","post","type-post","status-publish","format-standard","has-post-thumbnail","category-california","tag-california","tag-california-headlines","tag-california-news","tag-mark-zuckerberg","tag-meta","tag-stock","tag-taxes","tag-voters-and-voting"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/posts\/505371","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/comments?post=505371"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/posts\/505371\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/media\/505372"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/media?parent=505371"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/categories?post=505371"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us-ca\/wp-json\/wp\/v2\/tags?post=505371"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}