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The late president of the Samsung Group, Lee Kun-hee. Photo = News 1
The late Lee Kun-hee, former Samsung Electronics(72,300 -0.96%) The inheritance tax for shares payable by the president’s heirs has been confirmed at 11 trillion won, the highest level in history. Attention both within and outside the business community is focused on how to prepare financial resources, asset division, and whether the group’s share price rises.
According to the business and financial investment industry on the 22nd, it was confirmed that the amount of inheritance tax that bereaved relatives such as Lee Jae-yong, vice president of Samsung Electronics, must pay on Lee Jae-yong’s share ownership amounted to 11 trillion won.
According to the Financial Supervision Service, former chairman Lee Kun-hee owns a 4.18% stake in Samsung Electronics, reaching 249,273,200 shares. In addition, Samsung Electronics Woo (preferred stock) has 610,900 shares (0.08% stake), Samsung Life Insurance(80,000 + 5.54%) 41,151 million shares (20.76%) Samsung C&T(132,500 + 3.92%) 5.25.5733 shares (2.88%) Samsung SDS(177,500 -1.11%) 9701 shares (0.01%), etc.
On the stock market that day, Lee’s stock was ▲ Samsung Electronics 72,300 won ▲ Samsung Electronics 68,500 won ▲ Samsung SDS(177,500 -1.11%) 173,500 won ▲ Samsung C&T 132,500 won ▲ Samsung Life finished the market with 80,000 won.
Inheritance tax on share property is assessed based on the flow of shares for two months (a total of four months) before and after the death of the heir. With the death of former President Lee on October 25, the scale of the inheritance tax on stock ownership was determined as the average market price based on the flow of shares from August 24 to the present day.
According to the Korea CXO Research Institute (Director, Oilsun), which specializes in corporate analysis, the value of stock assets held by former President Lee during the four months before and after Lee’s death was KRW 5, 67,700 million (34.1%). The reason that stock assets have risen dramatically is that Samsung Electronics’ stock value has risen dramatically. More than 80% of President Lee’s equity assets are owned by Samsung Electronics.
Additionally, an inheritance tax of at least KRW 1 trillion is expected to be added when personal assets such as real estate, artwork, bonds and cash are combined, such as Yongin lands under the name of former President Lee and his house in Hannam-dong, Yongsan.
Photo = Yonhap News
Given the astronomical tax burden on inheritance, both inside and outside the industry pay attention to what will happen to the division of property of grieving families, such as Ms. Hong Ra-hee, Vice President Lee Jae-yong, President Lee Bu-jin and President Lee Seo-hyun. In particular, the key points are whether President Lee Kun-hee left his will and who will take over ownership of Samsung Electronics and how much for Samsung’s governance structure.
Korea’s CXO Research Institute believes that the share price of former President Lee’s stock should also focus on the rise. This is because there is more room for Samsung Life, which President Lee argues, to react more sensitively than ever.
In the case of Samsung Life, only in the first half of 2018, there were many cases where the share price was in the range of 130,000 won, but in April-July of this year, it fell to the range of 40-50,000. won. The share price has recovered around KRW 70,000 with the recent rally in the stock market.
“Recently, with the death of former President Lee, public opinion about adjusting the inheritance tax rate is increasing,” said the director of the Yoosun CXO Research Center. “This is not only the inheritance tax rate, but it is desirable to comprehensively judge the corporate annual tax and the income tax rate,” he emphasized.
He added that “if the inheritance tax rate is lowered and annual taxes, such as corporation tax and income tax, are increased, it can eventually become a josamosa (朝三暮四).”
Chae Seon-hee, Hankyung.com Reporter [email protected]
