SpaceX June 12 IPO at $1.8 Trillion Valuation to Generate California Tax Revenue

SpaceX will sell 555.6 million shares at $135 each in its June 12 IPO, raising about $75 billion and valuing the company at roughly $1.77 trillion. The company is now headquartered in Boca Chica, Texas, but maintains a large workforce in the Los Angeles area.

Its S-1 filing states it employs more than 22,000 people worldwide, and the city of Hawthorne reported 7,661 employees at the former California headquarters last June.

California taxes income above $1 million at 13.3 percent, including a 1 percent mental health services tax. Texas has no personal income tax. Owen Zidar, professor of economics at Princeton University, said California will likely collect far more tax revenue than Texas because many employees still live and work in Los Angeles.

Ross Gerber, CEO of Gerber Kawasaki, said the IPO will boost California's economy and tax collections, noting the state's budget relies heavily on capital gains from high earners.

Christina Lewellen, associate professor of accounting at North Carolina State University, said tax obligations depend on when restricted stock vests or is sold. Employees can time sales, spreading tax payments over multiple years rather than a single event.

Brian Uhler, deputy legislative analyst for California, noted that many SpaceX restricted stock units use a single-trigger vesting schedule, which spreads tax revenue over time instead of concentrating it at the IPO date.