The ailing health of Samsung’s Group patriarch triggers worry about a very hefty inheritance tax bill
The heirs to the Samsung empire are likely to face one of largest inheritance tax bills in history.
It is thought that they would have to pay as much as $6 billion (£3.6bn) to gain access to the rest of their inherited wealth.
The speculation comes amid worsening health condition of Samsung Electronics chairman Lee Kun-hee.
In May, Lee suffered a heart attack. Although he is said to be recovering after heart surgery, he has been plagued with a number of health scares in recent years. He was hospitalised last August with pneumonia, and was previously treated for lung cancer in the late 1990s.
72-year-old Lee built Samsung Electronics, the flagship unit of the South Korean conglomerate Samsung Group, into a global brand. The company of course made its name by selling mobile phones, laptops, semiconductors, televisions, and household appliances. But its businesses also include steel, financial services, and even tractor manufacturing.
Lee is the son of the company’s founder, and he took over the running of the South Korean conglomerate (otherwise known as a chaebol) back in 1987, after the death of his father.
Thanks to a number of cross-shareholdings in group companies, the family are thought to still control most of Samsung. Indeed, it is thought that Lee and his three children maintain influence over roughly 80 Samsung Group companies.
Lee’s day-to-day involvement in the business is relatively light now as he occupies the chairman seat, whilst the management is handled by three co-chief executives. However, it is widely believed that Lee still has the final say in most strategic decisions.
And now concerns about Lee’s health have prompted speculation as to what will happen to his empire. Lee’s heir apparent is his 45-year-old son Jay Y. Lee, who also has two sisters. All three heirs could be facing an inheritance tax bill of $6 billion (£3.6bn) under South Korea’s top level inheritance tax rate of 50 percent, according to Reuters.
Although the Lees have long prepared for succession, there is reportedly limited scope for the family to avoid this very hefty tax bill. Every move they make to lessen their tax obligations would likely be opposed by civic groups and politicians.
Meanwhile in Europe, Google, Amazon and others have all faced severe criticism in the past over the level of corporate tax they pay. Some in political circles believe that tech goliaths should be forced to pay more tax.
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