Elon Musk will sell $21bn worth of Tesla shares if Twitter followers agree

Technology mogul will abide by result of poll and pay taxes on proceeds of sale of 10% of his stock in electric car maker

Elon Musk has said selling stock is the only way he can pay tax as he does not take a cash salary or bonus. Reuters
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Elon Musk on Saturday asked his 62.5 million followers on Twitter in a poll if he should sell 10 per cent of his Tesla stock.

Mr Musk's shareholding in Tesla comes to about 170.5 million shares as of June 30. Selling 10 per cent would result in proceeds of about $21 billion, based on Friday's closing price, according to Reuters calculations.

Referring to a "billionaires' tax" proposed by Democrats in the US Senate, Mr Musk tweeted that "much is made lately of unrealised gains being a means of tax avoidance, so I propose selling 10% of my Tesla stock".

Analysts say he may have to offload a significant number of shares anyway to pay taxes since a large number of his stock options will expire next year.

Mr Musk followed up with another tweet saying he would abide by the results of the poll, whichever way it goes.

The poll received over a million responses in three hours since he posted it, with 54 per cent of respondents approving the proposal to sell the shares. The poll is scheduled to end around 3pm ET (8pm GMT) on Sunday.

The comments from Mr Musk came after the proposal in the US congress to tax billionaires' assets to help pay for President Joe Biden's social and climate-change agenda.

Mr Musk is currently the world's richest person and owner of several companies, including SpaceX and Neuralink. He has previously criticised the billionaires' tax on Twitter.

His tweet raised some eyebrows in the world of finance.

"We are witnessing the Twitter masses deciding the outcome of a $25 billion coin flip," Venture investor Chamath Palihapitiya wrote on Twitter in response to Musk's tweet.

"Looking forward to the day when the richest person in the world paying some tax does not depend on a Twitter poll," Berkeley economist Gabriel Zucman tweeted.

Musk got into trouble with a tweet about Tesla in 2018.

The US Securities and Exchange Commission sued Mr Musk after he tweeted that he had “funding secured” to take Tesla private at $420 a share.

The agency said the tweet, which sent Tesla’s share price up as much as 13.3 per cent, breached securities laws. Mr Musk later reached a deal with the regulator to end the dispute.

"Note, I do not take a cash salary or bonus from anywhere. I only have stock, thus the only way for me to pay taxes personally is to sell stock," Musk said on Twitter.

Tesla shares recently hit record high after it received its biggest order of 100,000 electric cars from Hertz.

Tesla board members, including Elon Musk's brother Kimbal, have recently sold their shares in the electric car maker. Kimbal Musk sold 88,500 Tesla shares while fellow board member Ira Ehrenpreis sold shares worth more than $200 million.

Mr Musk recently said on Twitter he would sell $6 billion in Tesla stock and donate it to the World Food Programme, provided the organisation disclosed more information about how it spent its money.

He and WFP head David Beasley have been engaged in a heated debate since Mr Beasley last week challenged billionaires to give more of their wealth to end hunger.

Updated: November 08, 2021, 6:00 AM