Tech billionaire Elon Musk has been told he should sell 10% of his shares in Tesla, worth around $21bn, after asking people in a Twitter poll whether he should do so.Musk, who is chief executive of the electric vehicle and clean energy company, said he would “abide by the results of this poll, whichever way it goes” before the voting closed.
The 50-year-old posted in a tweet as he shared the poll: “Much is made lately of unrealized (sic) gains being a means of tax avoidance, so I propose selling 10% of my Tesla stock. Do you support this?”The results came in and 57.9% of people said he should sell the shares, to which Musk said: “I was prepared to accept either outcome.”The poll attracted more than 3.5 million votes.
Much is made lately of unrealized gains being a means of tax avoidance, so I propose selling 10% of my Tesla stock.Do you support this?— Elon Musk (@elonmusk) November 6, 2021
As of 30 June, Musk’s shareholding in Tesla came to about 170.5 million shares and selling 10% would amount to close to $21bn (£16bn) based on Friday’s closing, according to Reuters calculations.
Musk said in a separate tweet on Saturday that he does not take a cash salary or bonus “from anywhere” and only has stock, adding: “Thus the only way for me to pay taxes personally is to sell stock.”
He shared the poll after US Senate Democrats unveiled a proposal to tax billionaires’ stocks and other tradeable assets to help finance President Joe Biden’s social spending agenda, and fill a loophole that has allowed them to defer capital gains taxes indefinitely.Musk has criticized the proposal, saying: “Eventually, they run out of other people’s money and then they come for you.”
Elon Musk dances onstage during a delivery event for Tesla Model 3 cars in Shanghai
Including stock options, Musk owns a 23% stake in Tesla, the world’s most valuable car company whose market value recently exceeded $1tn (£741bn).He also owns other valuable companies, including SpaceX.The billionaire’s brother Kimbal Musk sold 88,500 Tesla shares on Friday, becoming the latest board member to offload a large number of Tesla stocks, which hit record highs.A week ago, Musk said on Twitter that he would sell $6bn (£4.4bn) in Tesla stock and donate it to the United Nations’ World Food Programme (WFP), provided it disclosed more information about how it spent its money.
Musk also owns SpaceX
Musk has previously said he would have to exercise a large number of options in the next three months, which would create a big tax bill.He also said he did not want to borrow against stock to pay taxes because stock value could go down. If he sold some of the stocks, that could free up funds for the tax bill.Bryan Springmeyer, an attorney at San Francisco-based law firm Springmeyer Law, said: “(It) seems crazy to borrow that much to pay taxes, so I have to assume he’d need to liquidate a substantial amount of the shares purchased from the option exercise to pay taxes.”