Friday , July 30 2021

Musk plans to move to Texas where there is no tax …



Several friends and associates of billionaire Elon Musk reported that Tesla CEO intends to move to Texas as it was listing its homes for sale in California this year when a conflict arose with state authorities over Covid-19 restrictions.

Meanwhile, Musk is expanding its business in Texas and has a good relationship with the Republican government, Greg Abbott, reports News.ro.

Musk, the second richest man in the world after Jeff Bezos, is already a frequent visitor to Texas. He spends most of his time between Austin, where Tesla and his Boring Company operate, and the coastal village of Boca Chica, where the SpaceX unit is located.

SpaceX began operating in Texas in 2003.

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Musk frequently posts photos and videos of the SpaceX Test and Launch Center known as Starship Production Complex on Twitter.

Often criticized by the super-rich for high taxes and rigid regulations, California witnessed an exodus of big names in the tech sector during the pandemic as companies struggled to cut costs and prepare for the future of a fragmented workforce.

Musk was one of the strongest critics this year, comparing the condition to a sports team in the league that was content and developed “a problem because he had been a winner for too long.”

In May, when California companies were forced to remain closed due to the pandemic, Musk tweeted that he was moving Tesla headquarters and future development from California to Texas and Nevada.

Leaving California, where the country has the highest income tax in Texas, a non-taxable state, could save Musk billions of dollars based on the 2018 compensation package.

Musk has received 101.3 million options (adjusted for a 5-to-1 split this year) that are exercised at a time when the company hits certain milestones, including market capitalization.

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Tesla shares have risen by 782% over the past year. In October, Musk won prizes worth around $ 20 billion before taxes, based on Thursday’s closing, part of the total potential.

Musk claims he is selling all his “tangible goods” and tweeted in May that he “will not have a home”. Soon after, Musk put up for sale several homes in California.

CNBC has been unable to find any public records to suggest that it has officially changed its place of residence, and the White Pages online database continues to list her main address as Los Angeles.

Even people who know him well and know his general plans to move to Texas say they don’t know exactly where he is, when he is there, and that he is trying to keep these details a secret.

The supreme state official, Governor Abbott, seems confident Musk will make the move.

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In July, Abbott told CNBC’s Squawk Box that Musk told him he had obtained a Texas driver’s license and that he was now a “Texan of good faith.”

Abbott also said Musk is building his future Tesla factory in Texast as it will give him the freedom to “expand the scope to expand”.

When contacted about the matter, an Abbott spokesman declined to comment on Musk’s plans. To help attract a new Tesla factory, local officials have given the company tens of millions of dollars in real estate tax exemptions.

Musk confirmed in a second-quarter financial report, published in July, that the plant will occupy approximately 2,000 acres 15 minutes from the center and will be used to build Cybertruck, Semi, Model 3 and Model Y vehicles.

The billionaire said the factory will start delivering cars next year. In addition to SpaceX and Tesla, the Boring Company has an office in Texas. Seven of the 17 job openings the company offers on its website are in Austin, and Musk has suggested building a tunnel there.

Boring investor Joe Lonsdale, co-founder of Palantir and friend of Musk, recently moved to the Austin area of ​​Silicon Valley.

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For now, Tesla is still based in Palo Alto, California, and the company continues to build cars in nearby Fremont. SpaceX’s primary address is in Los Angeles County.

Musk’s personal financial incentive to leave California is significant. According to the 10-year compensation package approved in 2018, Musk could win over $ 50 billion in stocks and prizes in 12 tranches, reaching fourth position.

Musk should pay income tax when exercising options. The highest income tax rate in California is 13.3%. In Texas, it’s zero.

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Musk began collecting rewards after the company achieved a market cap of $ 100 billion, along with specific amounts of adjusted revenues or profits. For every $ 50 billion increase in market capitalization, to a total market value of $ 650 billion, there will be another reward if the revenue or profitability target is met.

The company is already worth over $ 550 billion, after it starts the year well below $ 100 billion. In the third quarter, the second and third tranches were released, and the fourth was completed in October, the company said in the last quarterly report.

This is equivalent to approximately 33.8 million out of 101.3 million shares. For the package to remain intact, Musk needs to remain either the CEO or the CEO and Product Manager. Musk and Tesla and SpaceX spokesmen did not immediately respond to requests for comment.


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