David Sacks: California's Wealth Tax Has a SECRET Clause That's Forcing Entrepreneurs Out
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Episode Description
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Brief Summary
Larry and Sergey face complex tax burdens due to super voting stock provisions at Google.
Key points
- Larry and Sergey’s Voting Power. Larry and Sergey control about 52% of Google, valued at 4 trillion.
Transcript
Larry and Sergey have left the state and they're probably getting dragged for that. But one of the reasons why I think they kind of have to is because of the super voting stock provision in this thing where the way they calculate the value of your stock is not based on its liquid market value, but if you own super voting shares, they multiply your ownership, your super voting by the market cap of the company and they deem your shares to be worth that. Yeah. So for example, Larry and Sergey, I think they combined have voting power of about 52% of Google. So what's Google worth these days? About 4 trillion. But now I guess each one of them would be deemed to be roughly 1 trillion each. Not the
call it 200 billion. So the 5% tax for them is more like a 25% tax of all their net worth. it becomes 50 because you'd have to sell more than that to overcome the drag of selling to generate 25 billion or 50 billion of net worth. You have to sell 2x that because you have to pay taxes on that, >> right? So now what what is the point of having that super voting provision in there? It's just totally punitive and vicious.
