{"id":891640,"date":"2026-10-23T06:02:10","date_gmt":"2026-10-23T06:02:10","guid":{"rendered":"https:\/\/www.newsbeep.com\/us\/891640\/"},"modified":"2026-10-23T06:02:10","modified_gmt":"2026-10-23T06:02:10","slug":"mark-zuckerbergs-creative-plan-to-pay-californias-proposed-billionaire-tax-without-losing-control-of-meta","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/us\/891640\/","title":{"rendered":"Mark Zuckerberg’s creative plan to pay California\u2019s proposed billionaire tax without losing control of Meta"},"content":{"rendered":"

During Meta\u2019s earnings call on Wednesday, the company revealed<\/a> its board had approved a new class of nonvoting stock, called Class C common stock. The shares give the holder an ownership stake but no vote on company decisions. This class takes effect in January. Meta says it will use the stock for capital raising, employee pay, and acquisitions \u2014 including its expensive push into AI \u2014 while maintaining the current voting structure that favors its founder and CEO, Mark Zuckerberg, who controls around 60% of the vote.<\/p>\n

Now, however, the New York Times has reported<\/a> there\u2019s another reason for the new class: helping Zuckerberg pay for California\u2019s proposed \u201cbillionaire tax,\u201d if voters approve it. Because the new shares carry no votes, he could sell some of them<\/a> to cover the tax without giving up voting control.<\/p>\n

Proposition 40<\/a>, which was drafted by<\/a> Berkeley tax law professors and is being sponsored by California\u2019s largest healthcare union (SEIU United Healthcare Workers West), would level a one-time 5% wealth tax on the net worth of several hundred California billionaires who primarily live in the state. Backers say the policy could generate as much as $100 billion over five years, the bulk of which would be used to pay for the state\u2019s healthcare needs, with the rest being used for food assistance and education.<\/p>\n

The Times also reports that Zuckerberg pressed Meta\u2019s board to come up with a plan to protect him from the tax. According to the paper, he told board members in September that if they couldn\u2019t reach an agreement, he\u2019d list his Palo Alto property for sale, potentially kicking off a media firestorm. Not long afterward, the stock plan materialized, the newspaper writes.<\/p>\n

The Times reporting is partially based on a recent SEC filing<\/a> that Meta made, which documents the concern surrounding Proposition 40 and how it informed discussions that led to the new stock class.<\/p>\n

The filing says that as far back as July, Zuckerberg was discussing the billionaire tax with board members. The topic came up again in additional meetings and communications throughout that month and August.<\/p>\n

The filing also describes how the plan would work. Meta is creating a new class of nonvoting shares, called Class C, and will give shareholders one of them for every Class A or Class B share they own. The company calls this a one-time stock dividend and says it should work out to a two-for-one stock split. The dividend \u201cwill not change the voting power of any shareholder,\u201d Meta says.<\/p>\n

That is where Prop 40 comes in. The filing says the dividend \u201cwill allow Mr. Zuckerberg to immediately sell or transfer up to 20% of the shares of Class C common stock that he receives in the Dividend, representing 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 the dividend is one-for-one, half of his post-dividend shares will be Class C, so the 20% cap equals 10% of his total economic stake.<\/p>\n

When reached for comment by TechCrunch, Meta referred us to a quote included in its recent earnings press release<\/a> that reiterates that part of the motivation for the creation of the stock was to keep Zuckerberg onboard: \u201cThe\u00a0Special\u00a0Committee 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.\u00a0Zuckerberg remains in close coordination with the Company\u2019s management and in close proximity to Meta Superintelligence Labs.\u201d<\/p>\n

It\u2019s been estimated that Zuckerberg would have to pay as much as $11 billion<\/a> as part of the tax.<\/p>\n

Prop 40 has notably riled many of Silicon Valley\u2019s most prominent businesspeople. Google co-founder Sergey Brin has aggressively campaigned<\/a> against the measure, even spending a small fortune<\/a> in an effort to defeat it. Other business leaders<\/a> and critics of the proposal have criticized it online, with many claiming<\/a> that it amounts to economic suicide for California, driving a capital flight from the state. However, as Meta\u2019s new policy would appear to show, the state\u2019s mega-companies and the people who run them have creative ways of dealing with the tax, should it materialize.<\/p>\n

\u201cLooks like billionaires will stay and figure out a way to pay the tax,\u201d Democratic U.S. Representative Ro Khanna, a vocal proponent of the tax, wrote<\/a> on X, after news of Meta\u2019s strategy spread online. \u201cIf we pass Prop 40, poor California kids can have healthcare,\u201d he added.<\/p>\n

When you purchase through links in our articles, we may earn a small commission<\/a>. This doesn\u2019t affect our editorial independence.<\/p>\n","protected":false},"excerpt":{"rendered":"During Meta\u2019s earnings call on Wednesday, the company revealed its board had approved a new class of nonvoting…\n","protected":false},"author":2,"featured_media":891641,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[27],"tags":[198613,28,12424,1282],"class_list":["post-891640","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-billionaire-tax","tag-business","tag-mark-zuckerberg","tag-meta"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/891640","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/comments?post=891640"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/891640\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media\/891641"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media?parent=891640"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/categories?post=891640"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/tags?post=891640"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}