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Microsoft to pay ex-CEO Steve Ballmer $1 billion a year ‘for doing nothing’
The 67-year-old, the 30th employee in the company's history, is already among the world's richest individuals.
Already among the world's richest people, ex-Microsoft CEO Steve Ballmer is now set to receive nearly $1 billion (approx. ₹8300 crore) in dividends from his former employer, ‘for doing nothing,' according to CNN.
Microsoft's 30th employee in history who joined the company in June 1980, the 67-year-old held 333.2 million (33.32 crore) shares of the tech giant, as of 2014.
How will Ballmer get $1 billion ‘for doing nothing’?
This is because of Microsoft's decision to increase its quarterly dividend payout to 75 cents for each share, amounting to $3 per share annually. In 2024, therefore, Ballmer, whose 333.2 million shares translate to a 4% equity, will get just shy of $1 billion (999.6 million or 99.96 crore; 1 billion=100 crore) only for his ownership, regardless of how the stock performs.
The company began paying dividends to its shareholders in 2003. Since then, the amount has only gone up.
Will Ballmer be taxed?
US tax laws require individuals with annual taxable income of $500,000 or more, to pay 20% tax. Therefore, if one considers Ballmer's last reported income of $656 million (in 2018), the former CEO must pay the 20% tax ($200 million in this case) on his Microsoft dividends.
Who is Steve Ballmer?
He was the tech firm's CEO for 14 years, succeeding co-founder Bill Gates in January 2000, and handed over the coveted post to Satya Nadella, the incumbent, in February 2014. The billionaire, however, remained on its Board of Directors until August that year.
He owns the Los Angeles Clippers of the National Basketball Association (NBA) and is a co-founder of the Ballmer Group, a philanthropic investment firm.
