Meta Platforms has agreed to provide chief executive Mark Zuckerberg with additional non-voting shares under a deal designed to keep him in California amid the prospect of a new tax on the state’s wealthiest residents.

The arrangement follows Zuckerberg’s warning that he was considering moving his primary residence elsewhere if Proposition 40, a proposed levy on billionaires, becomes law, according to The Independent.

Under the agreement, Zuckerberg has committed to living in California, or wherever Meta’s headquarters is located, for the next eight years. The proposed tax would impose a one-time charge of five per cent on the wealth of billionaires in the state.

The deal would allow Zuckerberg, whose fortune is estimated at about $240 billion, to sell part of the shares allocated to him to meet a potential tax bill without relinquishing his voting control of the company. Meta plans to introduce a new class of non-voting Class C common stock in January 2027 through a two-for-one stock split.

The company’s board committee reportedly considered Zuckerberg’s continued leadership essential as Meta confronts intensifying competition and the costly expansion of artificial intelligence. Company projections indicate that the technology firm may need to raise hundreds of billions of dollars over several years to finance its growth strategy.

Proposition 40 has yet to be decided by California voters. The state is home to approximately 250 billionaires whose combined wealth exceeds $2 trillion, making the proposed measure a significant issue for some of the world’s richest individuals.