After losing over $200 billion in a day on bourses, Tesla CEO Elon Musk is reported to have sold more than $6.9 billion worth of shares in the electric carmaker this week. Musk is the world’s richest person, worth $294 billion according to the Bloomberg Billionaires Index.
According to regulatory filings, the 50-year-old South African billionaire sold more than 5.1 million Tesla shares, of which about 4.2 million were held in a trust. His massive disposal hit Tesla’s share price, which slumped 15.4% over the week.
Tesla last month became the latest US tech giant to hit $1 trillion in market value. Musk’s selloff came days after he created a Twitter poll — in which millions voted — asking whether he should sell 10 per cent of his huge stake in the electric carmaker.
On Saturday, Musk tweeted: “Much is made lately of unrealized gains being a means of tax avoidance, so I propose selling 10% of my Tesla stock. Do you support this?”
In the poll, almost 58% of the 3.5 million votes cast were in favour of him proceeding with the sale. Tesla shares had plummeted at the Wall Street opening on Monday and have fallen further since.
The stock Musk disposed of this week was sold at a significantly lower share price than if he had sold before his tweet. Regulatory filings showed the tech entrepreneur had initiated the sale of at least some of these shares ahead of the Twitter poll. According to the latest filings with the Securities and Exchange Commission, Musk still holds about 167 million Tesla shares.
Musk’s stock sale will be liable for a capital gains tax of at least $1.4 billion. His tweets followed a proposal by US Congressional Democrats to tax the super-wealthy more heavily by targeting stocks, which are usually only taxed when sold.