Meta has agreed a deal with its chief executive, Mark Zuckerberg, that is intended to keep the Facebook co-founder in California. The arrangement came after he threatened to leave the state over a proposed tax on billionaires.
Under the agreement, Zuckerberg, who is counted among the globe’s wealthiest individuals, can sell Meta shares to cover a large tax bill without giving up control of the California-based company.
Proposed billionaire tax still awaiting a vote
The proposal would levy a one-time 5% tax on state residents whose net worth exceeds $1bn (£750m). It has not yet become law, and Californian voters will decide on it on 3 November.
Many of the largest US tech firms are based in California, and about 225 billionaires live there, according to the Americans for Tax Fairness campaign group. Zuckerberg’s fortune stands at $226bn, according to Forbes’ billionaires tracker.
Zuckerberg’s warning to Meta’s board
Zuckerberg told the board he planned to stay with the firm for the “foreseeable future”. He added, however, that he was weighing a move of his main home outside California. A public home listing, he warned, would be noticed and discussed by staff, and this “would raise questions for management of the company going forward”.
Negotiations with a special committee at Meta were described as “robust” and, at several points, “contentious”. The committee concluded that keeping Zuckerberg in a leadership role, and based in California to run the firm from its headquarters, was “critically important” amid “this era of unprecedented challenge and competition in our industry”.
Meta links share deal to AI work
Technology companies across the US and beyond are investing heavily in artificial intelligence and the infrastructure that supports it. Meta said the share arrangement was appropriate so that Zuckerberg “remains working closely” with the company’s AI efforts at its headquarters.
The company said his “talent and leadership have been crucial to our growth, strategy, and stability since our inception, and the special committee wants that to continue”.
