Samsung Family Borrow Money to Pay Inheritance Tax
20 March, 2021
Samsung chief Lee Jae-yong, and his several sisters took out hundreds of billions of won in loans to pay the inheritance taxes on the vast fortune just after their patriarch Lee Kun-hee died this past year.
Loans were the only alternative to selling a few of their stocks and losing control of the great publicly traded conglomerate, which hangs by a thin thread through a Byzantine holdings structure.
They originally tried to put up their stocks simply because collateral for the loans, but simply no brokerages in Korea had that much money because they have nearly maxed out their lines of credit immediately after retail investors took out an archive amount of loans in a stock-investment frenzy.
One sector insider said Lee's sisters and mother Hong Ra-hee "tried to acquire loans from brokerages utilizing their stocks as collateral but were told they couldn't borrow up to they wanted, thus they went to the bank instead."
Lee Jae-yong's inventory dividends alone totaled around W210 billion this past year, thus he is best for nearly every amount of credit (US$1=W1,125).
The Samsung heirs may possibly also sell a few of their art collection, which include among Monet's water lily paintings and is regarded as worth W2-3 trillion. The Monet would fetch a lot more than W100 billion at auction.
Samsung has asked the Galleries Association of Korea and two different organizations to appraise round 12,000 artworks found in the collection and the procedure is almost done. But there were increasing demands Samsung to donate the skill to museums and stop them from disappearing into billionaires' vaults around the world.
Lee senior's estate was valued at around W22 trillion, which entails an inheritance taxes of near W13 trillion. Also if paid out in installments, that might be more than W2 trillion in inheritance taxes this year alone. They possess until April 30 to shell out up.
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