The family of late Samsung Electronics Chairman Lee Kun-hee is set to complete payment of 12 trillion won ($8 billion) in inheritance taxes this month, lifting a major financial burden for South Korea's largest conglomerate.
According to industry sources on Sunday, Samsung Electronics Chairman Lee Jae-yong and other family members — including his mother Hong Ra-hee and sisters Lee Boo-jin and Lee Seo-hyun — will make the final installment, concluding a five-year plan to settle one of the largest inheritance tax bills ever recorded.
The end of the payments is expected to reduce uncertainty for the conglomerate and reinforce Lee Jae-yong’s leadership.
The tax bill stemmed from Lee Kun-hee’s estate, estimated at around 26 trillion won, including shares, real estate and art collections. In 2021, the family opted to pay the amount in six installments over five years under South Korea’s deferred payment scheme.
Hong, honorary director of the Leeum Museum of Art, bears the largest share, about 3.1 trillion won, followed by Lee Jae-yong with 2.9 trillion won, Hotel Silla President Lee Boo-jin with 2.6 trillion won and Samsung C&T President Lee Seo-hyun with 2.4 trillion won.
To raise funds, the three women sold stakes in affiliates, including Samsung Electronics, Samsung SDS and Samsung C&T, and entered stock trust agreements. In January, Hong signed a trust deal to dispose of 15 million Samsung Electronics shares as part of the final funding efforts.
Lee Jae-yong largely avoided selling shares in core affiliates, relying instead on dividends and personal loans while maintaining control centered on Samsung C&T, the group’s de facto holding company.
His stake in Samsung Electronics common shares has risen to 1.67 percent from 0.70 percent prior to the inheritance, while his holding in Samsung C&T increased to 22.01 percent from 17.48 percent. His stake in Samsung Life Insurance also climbed to 10.44 percent from 0.06 percent.
Industry estimates suggest the Samsung family has received about 4 trillion won in dividends from affiliates since Lee Kun-hee died in 2020. Including earlier accumulated payouts, more than 6 trillion won may have been used to fund the inheritance tax payments, analysts say.
Alongside the payments, the family has also carried out large-scale donations. In 2021, it pledged 1 trillion won for medical causes and donated more than 23,000 artworks from Lee Kun-hee’s collection to the state.
With the inheritance tax issue nearing resolution, analysts expect Samsung to shift its focus more decisively toward investments in semiconductors, AI and biopharmaceuticals, as well as broader business restructuring.
The timing coincides with improving earnings momentum. Samsung Electronics is expected to post strong first-quarter results, driven largely by robust demand for advanced AI memory, which has lifted DRAM prices and boosted profitability in its semiconductor business.
Market consensus for Samsung Electronics’ operating profit has been revised up by more than 10 percent from a month earlier to around 40 trillion won, which would be double the 20.1 trillion won recorded in the fourth quarter and mark a new all-time high.
While preliminary earnings do not break down divisional performance, the gains are widely expected to be driven by the semiconductor business.
By Jo He-rim (herim@heraldcorp.com)
