Meta has agreed to give chief executive Mark Zuckerberg new shares that could help him pay a potential multibillion-dollar California wealth tax, in return for a commitment to remain resident in the state for eight years.
Meta has struck a deal with Mark Zuckerberg that could help the billionaire pay a multibillion-dollar tax bill if California voters approve a proposed wealth tax on the state’s richest residents.
Under the arrangement, Zuckerberg will receive new shares that could be sold to cover his liability if Proposition 40 passes.
In return, the Meta chief executive has committed to remain a resident of California, or wherever Meta is headquartered, for eight years.
Californians are due to vote early next month on Proposition 40, which would impose a one-off five per cent tax on about 250 billionaires living in the state.
Zuckerberg, whose wealth is estimated at $239 billion (£180 billion) by Forbes, had told Meta he was considering moving his primary residence elsewhere because of the potential tax bill.
The agreement would allow him to sell shares to meet the liability without reducing his control of the company.
Meta plans to create a new class of non-voting Class C shares through a two-for-one stock split for existing shareholders. Zuckerberg could then sell some of those shares without diluting his voting power.
The proposal has attracted opposition from several technology billionaires, including Google co-founder Sergey Brin, Palantir co-founder Peter Thiel and former Google chief executive Eric Schmidt, who have spent heavily campaigning against the measure.
Recent polling has suggested Proposition 40 does not yet have majority support.
The agreement was disclosed as Meta reported quarterly revenue of $64.6 billion, a 26 per cent increase on a year earlier and above analysts’ expectations of $63.3 billion.
However, profits fell 37 per cent to $13 billion after the company recorded a $9.9 billion charge connected to a lawsuit over child protection and social media addiction.
Meta shares fell more than six per cent when Wall Street opened on Thursday (22.10.26), contributing to a wider decline among technology and AI-related stocks.
The company also disclosed that its workforce had fallen to 66,775 employees at the end of September, down 15 per cent from a year earlier.
The deal comes as California’s proposed tax puts the state’s billionaire population at the centre of a wider debate over wealth and taxation.
Rohit Khanna, the Democratic congressman representing California’s 17th district, has argued that the measure would force a choice over who should bear a greater share of the tax burden.
For Zuckerberg, the proposed arrangement offers a way to remain in California while potentially avoiding the need to sell voting shares if Proposition 40 becomes law.
Meta agrees deal with Mark Zuckerberg to help him foot multibillion-dollar California tax bill
