X

Samsung Heirs to Pay Truly Staggering Inheritance Tax

That's a lot of zeroes...
By Kate Seamons,  Newser Staff
Posted Apr 28, 2021 8:31 AM CDT
Updated May 2, 2021 12:00 PM CDT

(Newser) – An estate tax bill with 10 zeroes in it? It's apparently possible, and being levied in South Korea, where the family of Samsung Electronics chair Lee Kun-hee is settling his estate following his October death. South Korea's inheritance tax rate of 50% is second only to Japan's (the US rate is 40%), and that's translating into big, big bucks in this case. The BBC has a statement from Samsung, which says the family "expects to pay more than 12trn won"—that's about $10.8 billion—in taxes related to inheritance, which is more than half of the value of the late chairman's total estate." More:

  • That said, the family is reducing its tax liability by donating a massive art collection that Deutsche Welle reports includes 23,000 works, by artists ranging from Picasso to Salvador Dali. Another 1 trillion won will be donated to medical research. Doing so whittles down the taxable portions of Lee's estate.

story continues below

  • Lee's heirs have five years to pay the tax bill, and the family has said it will make six payments over that time, with the first made in April.
  • Reuters reports the news sent shares of of holding company Samsung C&T Corp down as much as 5.5%—Bloomberg reports most of Lee's nearly $21 billion fortune is made up of Samsung stock, and the family did not detail what would happen to the stock. "There was general investor disappointment," said an analyst with HI Investment & Securities. That means investors will likely learn whether shares will be sold in the next regulatory filing.
  • The AP notes there are rumors that the lack of detail could be because Lee's widow and kids haven't settled on a plan yet. Lee owned 4.18% of Samsung Electronics and had stakes in Samsung affiliates. "The complex shareholding structure has allowed Lee and his family to exert broad control over the group," notes the AP, which says analysts largely believe the shares will be divvied up in a way that further cements the control held by Lee's only son and corporate heir, Lee Jae-yong, who is currently serving 2.5 years in connection with a 2016 corruption scandal.
  • Regardless, the bill will be paid in full. "It is our civic duty and responsibility to pay all taxes," the family said in a Wednesday statement.
  • Bloomberg notes the inheritance bill, one of the largest ever worldwide, is more than three times South Korea's estate tax revenue for 2020.
(Read more inheritance tax stories.)

We use cookies. By Clicking "OK" or any content on this site, you agree to allow cookies to be placed. Read more in our privacy policy.
Get the news faster.
Tap to install our app.
X