As Monday morning dawns over the Texan sky, Tesla CEO Elon Musk is left with a decision to make: whether to sell 10 percent of his stock in the company that he has built from scratch over two decades or not. His followers on Twitter are roughly split on the matter, but the majority, or 57.9 percent to be precise, think that Musk should do it.
Tesla's stock prices have been on the rise for a while and as the owner of 22.4 percent of the company's stocks, Musk has seen his own personal worth balloon over $300 billion. The meteoric rise helped Musk leave behind Jeff Bezos as the richest person on the planet by a significant margin. However, it was met with criticism since he wasn't even paying taxes where millions of Americans had lost their jobs and millions across the globe were facing starvation. Musk was even asked to sell some of his stock to donate for those in need but later had refrained from doing so.
Though, over the weekend, Musk put out a Twitter poll, asking his over 60 million followers, if he should sell Tesla stock and pay his taxes. As per the current U.S. laws, owners of company stocks pay taxes only when they sell them and not when their values rise (unrealized gains) over time. While an upcoming bill is aiming to change this, Musk turned to Twitter to make a point about his willingness to pay his share of taxes by promising to abide by the outcome of the poll.
Much is made lately of unrealized gains being a means of tax avoidance, so I propose selling 10% of my Tesla stock.— Lorde Edge (@elonmusk) November 6, 2021
Do you support this?
As the poll closed on Sunday, almost 58 percent of the over three and a half million Twitter users voted that Musk should sell his stock. Bloomberg estimates that by current prices, the sale of 10 percent stock would fetch Musk $21 billion. The media outlet even went on to say that Musk might be considering a sale of stock to raise some cash beyond what he has secured after pledging it to raise money.
According to this CNBC report, Musk has pledged 92 million of his 227 million shares to secure cash loans from borrowers and it might be time to return some money back. The report also noted that some of the stock options given to Musk in 2012 are set to expire next year, so Musk needs to encash them and pay a $15 billion tax on the gains. So, Musk was likely to sell his stock sooner or later this year or early next year, regardless of the Twitter poll.
For now, Tesla stock prices seemed to have reached their peak but are likely to turn further downward when Wall Street opens on Monday. Musk may have promised to sell the stock but did not necessarily say when. The question is whether he will use the money for an altruistic purpose or just announce another company and start building supersonic jets with vertical takeoff and landing capacities.