Elon Musk asked Twitter if he would sell Tesla shares for 180 billion kroner, but may not get the answer he wanted

Elon Musk seems to have forgotten an important rule for Internet use: “Never ask for the meaning of the Internet if you do not want to know the answer.”

This weekend, he asked in a tweet if the net thought he should sell 10 percent of his Tesla shares to pay taxes. And the Internet responded, but perhaps not with the answer he wanted. Almost 58 percent of the over 3.5 million are Twitter users who voted, he thought he should sell the shares.

Musk wrote in a response to his own tweet that «I will follow the results of this vote, no matter which way it goes». Since then, it has mostly been quiet from him.

Tax on unrealized gains

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The background for the tweet is that a bill was presented to tax unrealized gains, intended as an attempt to close a loophole that billionaires have reportedly used to avoid paying taxes. The proposal was voted down fairly quickly, but has sparked a debate on the taxation of the extremely rich.

In short, gains or losses are unrealized until the shares are sold, and any loss or gain when comparing the purchase price and the selling price is then realized. The most common is to pay tax only when the gain is realized, since the gain before that time only exists “on paper”.

Elon Musk owns over 17 percent of Tesla, at a market value of around 210 billion dollars, or about 1800 billion kroner. According to Musk, he does not receive a salary or bonus in the form of money – only shares. «… the only way for me to pay taxes personally is to sell sharesHe stated in and tweet.

Would sell the shares anyway?

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According to CNBC however, it is likely that Musk would sell the shares anyway, and that the real reason for this is that he has to pay tax on stock options he received in 2012. The options allowed him to buy 22.8 million Tesla shares for $ 6.24 per action. In comparison, the share price the day before the Twitter vote was $ 1222.09 per share, ie almost 196 times the purchase price. In other words, Musk has earned just over $ 27 billion – or $ 237 billion – on his stock options. He has to pay tax on this, and it is likely that this is the real reason why he would sell part of his shares anyway.

According to one report discussed in Gizmodo, among others, Elon Musk paid exactly zero kroner in income tax in 2018.

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