Yoojung Lee and Sohee Kim, 28 April 2021
Samsung Group’s billionaire heirs outlined a long-awaited plan to pay one of the largest inheritance-tax bills in history, a more than 12 trillion won ($11 billion) transfer of assets that will take place over several years.
The family of Lee Kun-hee, who died last year, revealed the size of the total bill, along with its intention to donate 1 trillion won for medical facilities and approximately 23,000 works of art. Under South Korea law, the heirs are allowed to make the tax payment over five years.
The drama over succession at South Korea’s largest company has captured the country’s attention for years, ever since Lee, the patriarch and longtime head of Samsung Electronics Co., suffered a debilitating heart attack in 2014. His son, Jay Y. Lee, has been accused in two different lawsuits of illegal behavior to ensure control over the conglomerate and is currently serving a jail sentence after a conviction in the first case for corruption.
When his father died last year, the elder Lee left behind a fortune of almost $21 billion, with the bulk of it comprised of stakes in four Samsung units. That included a 4.2% holding in the electronics arm, an art collection estimated to be worth as much as 3 trillion won and some properties.
South Korea has one of the highest inheritance taxes in the world, at 50% when it exceeds 3 billion won. Another 20% levy is added when passing down shares owned by the largest shareholder. The average across the countries in the Organization for Economic Cooperation and Development, or OECD, is about 15%, according to the Tax Foundation based in Washington, D.C.