Meta’s share deal with Zuckerberg aims to cover potential multibillion-dollar wealth tax bill: How it works
Meta has struck a deal with CEO Mark Zuckerberg to keep him in California for the next eight years, as he was weighing leaving the state over its proposed wealth tax on billionaires.
The agreement, disclosed in a securities filing on Wednesday, comes as California prepares to vote on Proposition 40, a proposed one-time 5% tax on billionaires’ wealth. Zuckerberg, whose net worth stands at $247 billion, had been considering leaving the state if the measure is approved.
Under the agreement, Zuckerberg must “remain a resident of California, or any other jurisdiction in which the company maintains its corporate headquarters, for eight years,” Meta said in the filing, provided he continues in a full-time leadership role.
Meta is issuing a new class of Class C shares that carry no voting rights. The arrangement will allow Zuckerberg to sell shares to raise cash without significantly reducing his voting control over the company.
He can immediately sell 20% of the Class C shares he receives, equivalent to 10% of his overall economic stake. Restrictions on the remaining 80% will gradually lapse over eight years, provided he continues leading Meta.
The structure is intended to address concerns that paying the proposed tax could force Zuckerberg to sell his existing voting shares. Meta warned that such sales could reduce his voting interest to approximately 53% or lower.
Zuckerberg owned more than 342 million Meta shares at the end of 2025, with super-voting shares giving him more than 60% control of the company, according to a filing related to its annual report.
Proposition 40 would impose a one-time 5% levy on people whose net worth exceeded $1 billion on January 1, 2026, if approved by voters in November. About 90% of the proceeds would be earmarked for healthcare services.
Some billionaires, including Google co-founders Sergey Brin and Larry Page and PayPal and Palantir co-founder Peter Thiel, have reportedly relocated out of California amid concerns about the proposal.
Nvidia CEO Jensen Huang, however, has taken a different position. “I don't mind paying taxes; the more you make, the more taxes you pay, so I'm okay with that,” he told CBS News. “I'm not afraid of paying taxes,” he added, even if that meant an $8 billion tax bill.
Meta’s special committee said keeping Zuckerberg at the company’s headquarters was “critically important”, particularly as he works closely with Meta Superintelligence Labs amid intensifying competition in artificial intelligence.
The committee also cited difficulties during the Covid-19 pandemic, when Zuckerberg was away from the management team, saying it wanted to avoid similar challenges.
Meta CFO Susan Li said the new Class C shares would primarily serve as a financing tool, giving the company greater flexibility to fund its AI ambitions without diluting existing voting power.
(With inputs from agencies)
Sanchari Ghosh is an Assistant Editor at Mint with over 12 years of experience in journalism, specialising in personal finance, DLT & DeFi, geopolitics and foreign policy, with a particular emphasis on how these areas intersect. <br> She writes extensively about how money works in everyday life—helping readers navigate personal finance decisions. <br> As AI reshapes investing behaviour, capital is increasingly flowing into decentralized ecosystems, redefining how assets are managed, traded, and valued. She focuses on explaining how money flows within frameworks like Distributed Ledger Technology (DLT), DeFi protocols, and crypto markets—while also exploring what the future of money could look like in a trustless, programmable financial world. <br> She also focuses on immigration-related issues, simplifying complex topics around visas, passports, overseas financial planning, and the many practical challenges Indians face while moving or living abroad. <br> Alongside personal finance, Sanchari has a strong understanding of international politics, contemporary and historical conflicts, and global state decisions. She closely tracks how geopolitical developments influence economies, markets, and individual financial choices, bringing together finance and global affairs in her reporting. <br> She began her career as a desk editor, which gave her a strong foundation in news writing. Over time, her interest naturally shifted toward personal finance. Before joining Mint in 2020, she worked DNA, The Times of India, Outlook Money, BloombergQuint, and ETMoney. At Mint, she got an opportunity to expand her coverage to include immigration and geopolitical developments while continuing to closely follow personal finance trends and market movements.As a journalist, she is committed to accuracy, intellectual rigour, and fairness. <br> She is an English Major and her work took her across cities including Delhi, Mumbai, and Pune. Living independently from an early age gave her firsthand experience in managing life and money on her own. This practical exposure sparked her strong interest in personal finance. <br> Outside the newsroom, Sanchari is a sports enthusiast who regularly plays lawn tennis and squash. In her younger years, she was also a national-level badminton player.
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