Meta’s nonvoting stock plan may shield Zuckerberg’s control while paying California tax
Meta’s board has approved a new class of nonvoting shares, and the New York Times reports that part of the rationale is to let Mark Zuckerberg sell stock for a proposed California billionaire tax without losing voting control. The measure, Proposition 40, would impose a one-time 5% wealth tax on several hundred wealthy California residents. Meta’s SEC filing shows the tax proposal was discussed as the company developed the share plan.
Meta’s board has created Class C common stock, which carries ownership but no voting rights, effective in January. The company says it may use these shares for fundraising, employee compensation, and acquisitions, including AI investments, while preserving the existing voting arrangement that gives Mark Zuckerberg roughly 60% of votes.
According to the New York Times, another motive is letting Zuckerberg sell shares to cover a possible California billionaire tax without diluting his control. The SEC filing describes a one-for-one stock dividend and says he could sell or transfer up to 20% of the Class C shares he receives—equal to 10% of his economic stake—for any reason, including that tax.
If enacted, the proposal could affect California residents who rely on state-funded health care, food assistance, and education, while wealthy residents and company founders may adjust holdings or residency in response. Meta’s shareholders and employees could see governance effects from the new share class, and the debate may shape how other tech leaders respond to wealth-tax proposals.