The family of late Samsung Chairman Lee Kun-hee announced on Wednesday that it will pay inheritance taxes totaling more than 12 trillion won ($10.8 billion) on his estate and donate his vast personal art collection to South Korean museums.
In a statement, the family — his widow and three children including jailed Samsung Vice Chairman Lee Jae-yong — said the taxes will be paid in six installments over a five-year period starting this month.
“It is our civic duty and responsibility to pay all taxes,” the family said in the release, which came ahead of a Friday deadline to resolve the issue.
Lee Kun-hee died in October last year. Speculation has centered on how his heirs would pay the taxes and also how Lee’s wealth and shareholdings would be distributed among them to ensure that they maintain corporate control over the empire of 59 companies that comprise the Samsung Group. Its interests range from electronics and construction to shipbuilding, biopharmaceuticals and insurance.
The family said that the taxes to be paid are on Lee’s shareholdings in Samsung Electronics, Samsung Life Insurance and Samsung C&T, along with his real estate properties.
But the release did not discuss the distribution of the inheritance among the family members.
A source familiar with the matter said that there is a possibility that it has not yet been finalized.
“The family can pay the tax together at the moment, and then they can calculate each other’s share later,” the source, asking not to be named, told Nikkei Asia.
The source also said that the Lee family will use its bank deposits and money borrowed from financial institutions to pay the tax.
“The inheritance tax payment is one of the largest ever in [South] Korea and globally, equivalent to three to four times the [South] Korean government’s total estate tax revenue last year,” the statement said.
Lee Kun-hee long controlled Samsung Group through a complex web of so-called circular shareholdings. He owned a 4.18% stake in Samsung Electronics — the conglomerate’s core — as well as 20.76% of Samsung Life Insurance and 2.88% of Samsung C&T, its construction unit and de facto holding company.
The family also said it will donate 1 trillion won for health initiatives including vaccine and infectious disease treatment research as well as assisting with the medical expenses of children suffering from cancer and rare diseases.
Lee’s artworks totaled more than 23,000 pieces, the family said, and include works by Pablo Picasso, Marc Chagall, Paul Gauguin, Claude Monet, Joan Miro and Salvador Dali.
