Meta Platforms has struck an agreement to keep CEO Mark Zuckerberg based in California for the next eight years, addressing concerns he had raised with the company’s board about a proposed state wealth tax that could cost him billions of dollars.
At the center of the deal is a new class of non-voting Class C common stock that Meta plans to issue in January 2027, effectively producing a two-for-one stock split designed to fund acquisitions and help retain top talent while preserving Zuckerberg’s voting control over the company.
The concern stems from Proposition 40, a California ballot measure asking voters whether to impose a one-time 5% tax on the state’s billionaires. Analysts say the measure is far from certain to pass, but a 5% levy on Zuckerberg’s roughly $240 billion fortune could amount to about $12 billion, though his actual liability would depend on how the tax is ultimately assessed.
Under the new structure, Zuckerberg will be able to immediately sell 20% of the Class C shares he receives, representing roughly 10% of his overall economic stake in Meta, giving him a way to raise cash for a potential tax bill without diluting his voting power.
According to a company filing with the Securities and Exchange Commission, Zuckerberg wanted to preserve his voting control, continue funding the Chan Zuckerberg Initiative with Meta stock, and still be financially prepared to pay the state if California voters approve the wealth tax in November.
The arrangement illustrates how a single state ballot measure can prompt a major publicly traded company to restructure its share classes, underscoring the scale of financial planning billionaire founders are willing to undertake to stay in place rather than relocate ahead of a potential tax change.
