Zuckerberg's Meta Deal Could Ease California Wealth Tax Bill
WHO:
The Next Web - Meta’s special committee included lead independent director Robert Kimmitt, DoorDash CEO Tony Xu, and Charles Songhurst; Xu disclosed a personal friendship with Zuckerberg.
Los Angeles Times - Gov. Gavin Newsom opposes a California-only wealth tax and has called for a national wealth tax. Xavier Becerra and Steve Hilton, candidates to replace Newsom, have also spoken against Proposition 40.
Los Angeles Times - Proposition 40 supporters include the California Federation of Labor Unions AFL-CIO; opponents include the California Teachers Assn., the California Medical Assn., and Planned Parenthood Affiliates of California.
Los Angeles Times - About 260 California billionaires could be subject to Proposition 40; 30 of them or their spouses spent money opposing it, according to a Times analysis.
Los Angeles Times - Sergey Brin contributed $102 million against the measure, more than a third of billionaire contributions opposing it. Other listed contributors included Peter Thiel ($3 million), Eric Schmidt (nearly $2.6 million), Kim DeGeorge ($1.9 million), Chris Larsen ($750,000), and Douglas Leone and his wife ($500,000).
Los Angeles Times - Researchers Jasper Boll, Emmanuel Saez, and Gabriel Zucman estimated that affected billionaires would owe at least $107 billion in taxes; Hoover Institution researchers estimated state revenue closer to $40 billion.
ABC News Tech - Mark Zuckerberg made a deal with Meta to help pay a proposed California billionaire tax if it passes.
Fortune - Zuckerberg owns about 13% of Meta but controls about 61% of its votes.
Fortune - Zuckerberg holds mostly Class B shares, each carrying 10 votes; Class A shares carry one vote each.
Fortune - Meta’s independent-director committee negotiated with Zuckerberg; the filing said he was “not on the verge of losing voting control.”
Fortune - Meta CFO Susan Li said the new share class would expand the company’s funding tools and preserve its founder-led structure.
WHAT:
The Next Web - Zuckerberg owns about 13.4% of Meta and controls 60.6% of its votes. Meta’s filing said selling enough shares to pay the proposed tax could reduce his voting power to about 53%.
The Next Web - After the initial sale of 20% of his new Class C shares, the remaining shares would be released at 2.5% per quarter while Zuckerberg remains in charge. Shareholders would receive another Class C dividend each time Meta’s share price doubles from $580.60, provided returns average at least 10% annually.
The Next Web - Meta reported $825 billion in future commitments, much of it related to AI. Meta shares fell about 7% on Thursday.
The Next Web - The campaign against Proposition 40 had raised more than $333 million, while the campaign supporting it had raised $32.7 million. Tech billionaires had put $120 million into the fight by July.
The Next Web - A Citrin-Politico poll reported 46% support and 43% opposition to Proposition 40.
Los Angeles Times - A Times analysis found that billionaire wealth in California nearly tripled between 2022 and 2026, while much of the increase was not taxed because gains on public stocks are generally taxed when shares are sold.
Los Angeles Times - Sergey Brin’s $102 million contribution against Proposition 40 was less than 1% of his estimated tax bill.
Los Angeles Times - The estimated $107 billion in tax payments would equal roughly $2,700 per California resident when spread across the state’s 39 million people.
Los Angeles Times - Meta’s filings put Zuckerberg’s taxable income at about $947 million in 2025, approximately 0.4% of his net worth.
Los Angeles Times - The Legislative Analyst’s Office says Medi-Cal provides healthcare coverage to one-third of low-income Californians.
Los Angeles Times - Billionaires contributed $293 million to oppose Proposition 40 and support Propositions 41 and 42, which would nullify the tax if either received more votes.
Los Angeles Times - Proposition 40 would apply to billionaires who were California residents on Jan. 1, 2026, based on net worth on Dec. 31, with payment spread over five years.
Los Angeles Times - The four richest Californians—Sergey Brin, Jensen Huang, Larry Page, and Mark Zuckerberg—would owe 40% of the estimated tax collection.
Los Angeles Times - Proposition 40’s authors estimate that 90% of the revenue would fund healthcare services to address a projected $190 billion, 10-year Medi-Cal federal-funding gap.
ABC News Tech - Zuckerberg made an agreement with Meta to help him pay a proposed billionaire tax that is on California’s ballot.
Fortune - The proposed tax is a one-time 5% levy on California billionaires’ net worth.
Fortune - Meta’s board approved a deal under which every shareholder receives one non-voting Class C share for each share held.
Fortune - Zuckerberg can immediately sell 20% of his new shares, equivalent to 10% of his overall economic stake, including to pay a potential California tax bill without reducing his majority voting control.
Fortune - Meta’s filing says Zuckerberg could face a “significant, multi-billion dollar tax payment” based on his stock ownership.
Fortune - Seven billionaires had publicly moved out of California, taking about $540 billion, or 30% of the state’s billionaire wealth; those named include Peter Thiel and Google cofounders Larry Page and Sergey Brin. Jensen Huang was staying.
WHERE:
Fortune - The tax concerns California; Meta is headquartered in California, and the agreement requires Zuckerberg to stay in California or wherever Meta is headquartered.
WHEN:
The Next Web - Meta’s new Class C share plan takes effect on 19 January 2027.
The Next Web - The committee’s board dinner with Zuckerberg was on 9 September; he said he would list his Palo Alto home on 13 September, and the parties agreed to terms on 14 September.
Fortune - The filing said California voters would decide on the tax on “Nov. 3.”
Fortune - The committee proposed a conditional dividend in August; Zuckerberg discussed the control ratio at an Aug. 26 meeting.
Fortune - Zuckerberg told the committee on Sept. 6 that he would need to start steps by mid-September to establish residency outside California by mid-October.
Fortune - The agreement commits Zuckerberg to remain in California, or wherever Meta is headquartered, for eight years, absent material unforeseen circumstances.
WHY:
Los Angeles Times - Chris Hoene of the California Budget and Policy Center said, “The reality is the income tax loss can never get anywhere near the scale of what the wealth tax gain would be.”
Fortune - The committee identified the wealth tax as a major potential threat to Zuckerberg’s voting control because paying it could require selling shares or borrowing against them.
Fortune - When Class B shares are sold, they convert to one-vote Class A shares, reducing Zuckerberg’s voting control.
Fortune - Meta’s board wanted Zuckerberg to remain nearby, citing the importance of his coordination with management and Meta Superintelligence Labs, and difficulties during the COVID-19 pandemic when he could not be physically present.
Fortune - Meta said the new stock would help finance growth and AI spending; forecasts showed the company might need to raise hundreds of billions of dollars over several years beginning as early as fall 2026.
HOW:
The Next Web - Meta said the new Class C shares would function like a two-for-one stock split.
Los Angeles Times - The Franchise Tax Board would calculate taxable wealth using publicly available stock information and private assessments of personal property, including artwork and jewelry.
Los Angeles Times - California’s Franchise Tax Board would determine residency and calculate taxable wealth; real property, pensions, and retirement accounts would be excluded.
Fortune - The committee initially proposed a dividend of non-voting stock payable only if California Proposition 40 became law and Zuckerberg’s tax payment became due; the amount was to cover his bill.
Fortune - Zuckerberg sought broader flexibility so he would not have to negotiate again if similar taxes were proposed elsewhere.
Fortune - Zuckerberg earns a $1 salary; the committee said the tax could otherwise leave him “effectively be paying to serve as the Company’s chief executive officer while residing in California.”
Fortune - Meta said its stock had risen more than 1,700% since its IPO, compared with about 495% for the S&P 500.
(UPDATED October 24, 2026 01:26 UTC)
Meta has approved a plan that could help Mark Zuckerberg pay a proposed California billionaire tax without giving up majority voting control. Shareholders would receive non-voting Class C shares, and Zuckerberg could immediately sell a portion; the arrangement also commits him to remain in California, or wherever Meta is headquartered, for eight years, subject to unforeseen circumstances. The plan takes effect on 19 January 2027. Proposition 40 would impose a one-time 5% tax on billionaires’ net worth, with most revenue intended for healthcare. Estimates of the tax take range from at least $107 billion to about $40 billion. Sergey Brin has contributed $102 million to oppose the measure, while the opposing campaign has raised far more than supporters. Gov. Gavin Newsom opposes a California-only wealth tax, and poll results show voters narrowly divided.
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(UPDATED October 23, 2026 23:14 UTC)
Meta has approved a deal allowing Mark Zuckerberg to sell newly issued, nonvoting shares to help pay a proposed California billionaire tax, while retaining control of the company. The measure would impose a one-time 5% levy on billionaires who were California residents at the start of 2026, with payments spread over five years. Its supporters say most revenue would fund healthcare, including Medi-Cal, as the state faces a major funding gap. Estimates of the tax take vary widely, from about $40 billion to at least $107 billion. Billionaires have spent $293 million opposing the measure and backing competing propositions that could cancel it. Sergey Brin alone gave $102 million. Gov. Gavin Newsom opposes a California-only wealth tax, while candidates Xavier Becerra and Steve Hilton have also spoken against the proposal. Seven billionaires have reportedly left California, though Jensen Huang is staying.
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(UPDATED October 23, 2026 20:06 UTC)
Mark Zuckerberg has secured a deal with Meta that could help him pay a proposed California billionaire tax without giving up voting control of the company. Meta’s board approved a plan to give each shareholder a non-voting share for every share held, allowing Zuckerberg to sell some of his new shares while retaining control. The measure would impose a one-time 5% tax on the net worth of billionaires who qualify as California residents. Billionaires have contributed $293 million to oppose it and back competing measures that could cancel it. A Los Angeles Times analysis found about 260 billionaires could be affected, with Sergey Brin alone contributing $102 million against the proposal. Estimates of potential tax revenue range from at least $107 billion to about $40 billion. Supporters say most proceeds would help healthcare programs facing a major federal funding shortfall.
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(UPDATED October 23, 2026 13:23 UTC)
Meta has approved a deal giving Mark Zuckerberg new shares he can sell to help pay a proposed California wealth tax, while preserving his voting control. The measure would impose a one-time 5% levy on billionaires’ net worth, and voters will decide on it Nov. 3. Under the agreement, every Meta shareholder receives one non-voting Class C share for each share they hold. Zuckerberg can immediately sell 20% of his new shares, equivalent to 10% of his economic stake, without giving up majority control. He owns about 13% of Meta but controls roughly 61% of its votes, largely through Class B shares with 10 votes each. Selling those shares would convert them to lower-voting stock. Meta’s independent directors negotiated the deal, saying Zuckerberg was not close to losing control. He also commits to remain in California, or wherever Meta is headquartered, for eight years, barring unforeseen circumstances.