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Why is Elon Musk Selling Tesla Stock after Social Poll?

The world’s richest person, Elon Musk recently asked his Twitter followers to advise him whether he should sell 10% of Tesla stock or not. He added that he would act accordingly to the results of this poll. It seemed like that people have spoken and nearly 58% of the users agreed with him selling Tesla stock.

Tesla shares plummeted by 4.5% because of the poll’s results.

What Does Tesla Stock Mean for Musk?

The decision to sell Tesla stock is likely due to Democratic lawmakers pushing the new billionaire’s income tax bill. American democrats have been pursuing this bill to help fund their proposed 3.2 trillion USD social spending package. According to reports this proposal would only affect citizens who have been earning more than 100 million USD for 3 consecutive years or have more than 1 billion USD in assets.

The reason why Elon Musk asked the question on twitter was because he didn’t take salary or bonus from the main sources of his enormous wealth. He only has stock so in order for him to pay tax in any sense would be to sell his stock.

Selling Can Help Pay Billionaire’s Income Tax

Musk owns around 17% of Tesla stock, which is equal to around 200 billion USD. However, he has also sold off all his residential properties and rented a 400 square unit on the Space X site. He has also taken loans by putting his shares on collateral.

Selling some of the stock can allow Elon Musk to collect the funds needed to pay taxes. Market speculators estimated that Musk owned nearly 170 million shares on June 30, and a 10% sale will make it around 21 billion USD. Tesla has reportedly sold almost 260 million USD worth of shares in the last 3 months.

How Much Tax Musk Could Pay?

The tax rate for Elon Musk is reportedly 53% due to which he is expected to pay a huge amount in tax. Some estimated that Musk’s tax bill which included a 37% income tax rate, 3.8% net investment tax, and 13.3% top capital gains, will likely exceed 15 billion USD. As the Twitter poll suggested many were in favor of Musk selling his Tesla stock, some found it to be ineffective.

Famous stockbroker Peter Schiff tweeted that while it made sense to sell the stock, it would be much beneficial for society. He added that the public would be better off if Musk invested the money himself rather than allowing the government to waste it in the name of tax.

According to reports, Elon Musk is not allowed to post anything on social media regarding Tesla, which is why US Securities and Exchange Commission (SEC) has previously expressed grievance with Musk. It alleged that Musk committed fraud by tweeting about a potential buyout of his company well before. The billionaire is widely known for moving stocks beforehand with his tweets, which ultimately manipulates the market. The same has been in the case of GameStop stocks as well.

A I Butt
A I Butt
The purpose of my writing is to record the same voices that are repressed by manual systems.
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