Twitter followers say yes to Elon Musk’s proposal of selling Tesla shares
Tesla shares slumped about 5 percent in premarket trading after CEO Elon Musk said he would sell 10 percent of his holdings (about $20 billion worth) in the electric car maker based on the results of a poll he conducted on Twitter over the weekend.
Musk said he would abide by the results of the poll, which ended with 58 percent of more than 3.5 million votes calling for him to sell the stock.
Musk owns about 17 percent of the one billion outstanding Tesla shares. If he sold 10 percent of his holdings at their current price of around $1,170 per share, it would net him around $20 billion.
Last week, Tesla shares hit an all-time intra-day high of $1,243.49 per share. It's the most valuable carmaker in the world, with a market capitalisation of over $1 trillion.
The sometimes abrasive and unpredictable Musk said he proposed selling the stock as some Democrats have been pushing for billionaires to pay taxes when the price of the stocks they hold goes up, even if they don't sell any shares. It's a concept called unrealised gains, and Musk is sitting on a lot of them with a net worth of roughly $300 billion.
Musk has criticised the proposal, which would affect 700 billionaires and impose taxes for long-term capital gains on tradable assets, whether or not they have been sold.
In September, Musk said he is likely to pay taxes of over half the gains he would make from exercising options.
"Much is made lately of unrealised gains being a means of tax avoidance, so I propose selling 10 percent of my Tesla stock," he tweeted Saturday afternoon. "Do you support this?" he added.
Much of Musk's wealth is held in shares of Tesla, which does not pay him a cash salary. "I only have stock, thus the only way for me to pay taxes personally is to sell stocks," he tweeted.
Musk, who is known for his sometimes flippant tweets, said he would abide by the results of this poll.
Edited by Suman Singh