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Samsung's Lee family to pay over $10.8B inheritence tax

reuters.com

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Re: Samsung's Lee family to pay over $10.8B inheritence tax

#31

Post by hogFeast »

vmception wrote: post #26
hogFeast wrote: post #24

Earlier quoted context omitted.

I would look at what the Lee family has done at Samsung. How well did they steward capital? So well, that the share price rose significantly when Lee Kun-hee actually died, and it looked like they would finally lose control. Kun-hee seemed like a very odd guy (there are videos online, people who posted this in SK got picked up by the NIS, of him having orgies with prostitutes). Jae-yong is less offensive but has a re…

Thanks! Is there any percentage of tax to the Korean government where your answer would change? It seems everything you wrote is true whether the tax is 1%, 10%, 30%, or the 50% that occurred here, let alone greater amounts. Is there a different outcome of the distribution of this money that you would support as well? It seems the primary constant is that this family of directors should not steward it. As an outside…

No, my point is that having a high inheritance tax leads to improved efficiency of capital markets. The Lee family have relied on literally illegal manoeuvres (they rigged a shareholder vote on an subsidiary acquisition) to maintain control, it is best that a company is guided by economic motives and not dictatorship by minority groups (again, the cost to Samsung has been substantial, that is why the company has pretty much always traded at a heavy discount).

I would read more about Kun-hee...the issue with the orgies is not moral judgement, the issue is that it paints a picture of someone who has a lot of other stuff going on: he spent almost no time at work (reportedly, he was obsessed with films and spent 95% of his waking time comatose watching films), he made others treat him as essentially a God...which, tbf, he basically was in SK...he was convicted of serious crimes twice, he oversaw massive political corruption (he gave literally tens of millions to individual politicians, his total bribes are probably in the billions), he gave impromptu incoherent rants that lasted multiple days that senior execs had to attend, no-one was allowed to make eye contact or look at him whilst their eye level was higher than his, factory workers weren't allowed to park within eyesight of his office, anyone who met him had to eat a mint before they spoke to him...this is just a small subset of the crazy shit...it is always funny to me that people will abandon all logic in order to reflect in their own self-regard (the reason why people say having prostitutes with orgies doesn't matter is because they want other people to know they are very liberal and forward-thinking...if you actually care about making money, it is difficult to think of a worse sign).

Re: Samsung's Lee family to pay over $10.8B inheritence tax

#32

Post by jellicle »

winkeltripel wrote: post #21
emrah wrote: post #17

Earlier quoted context omitted.

I don't know how it works in South Korea but in the US, appraisals don't require having to sell the building. Similarly, for insurance purposes, they need to determine a value without having to sell the building.

The idea is that you'd have to pay inheritance tax on the value of the building. The only way for someone without wealth to pay that would be to sell the building. The sale of an industrial site could take years, during which you'd owe a bunch of taxes.

The tax man will put a lien on the building and get their money when the building sells. This idea that being given billions of dollars (as the Lee family was) is somehow a bad thing or has downsides is just ludicrous propaganda.

For any billionaires out there, if you have unwanted buildings or want to punish me with a large tax bill, I will accept the punishment. Call me maybe!

Re: Samsung's Lee family to pay over $10.8B inheritence tax

#33

Post by jjj123 »

vmception wrote: post #9

Seems excessive, how well is the Korean government in stewarding public resources and identifying areas of the economy to direct capital? Do they have a history of being the proper stewards of this money than a private person?

Since when is that the only purpose of taxes?

I have no idea how efficiently the Korean govt distributes capital, but there are other reasons inheritance taxes are a good thing. Primarily because they limit the concentration of generational wealth in the 0.1%.

Re: Samsung's Lee family to pay over $10.8B inheritence tax

#34

Post by grumple »

vmception wrote: post #9

Seems excessive, how well is the Korean government in stewarding public resources and identifying areas of the economy to direct capital? Do they have a history of being the proper stewards of this money than a private person?

This is a drop in the bucket compared to their national budget, which is 493 billion this year. Billions are peanuts at the scale of a national government.

Re: Samsung's Lee family to pay over $10.8B inheritence tax

#35

Post by vmception »

hogFeast wrote: post #31
vmception wrote: post #26

Earlier quoted context omitted.

Thanks! Is there any percentage of tax to the Korean government where your answer would change? It seems everything you wrote is true whether the tax is 1%, 10%, 30%, or the 50% that occurred here, let alone greater amounts. Is there a different outcome of the distribution of this money that you would support as well? It seems the primary constant is that this family of directors should not steward it. As an outside…

No, my point is that having a high inheritance tax leads to improved efficiency of capital markets. The Lee family have relied on literally illegal manoeuvres (they rigged a shareholder vote on an subsidiary acquisition) to maintain control, it is best that a company is guided by economic motives and not dictatorship by minority groups (again, the cost to Samsung has been substantial, that is why the company has pret…

I gotta read about this guy!

His comatose film obsession is just as detrimental to his ability to make money as spending too much time with illegal sex workers. The commonality would be addiction, or more specifically neglecting other obligations. If neither of those things caused one to neglect other obligations, then there is nothing liberal and forward-thinking about not caring about the activity.

Re: Samsung's Lee family to pay over $10.8B inheritence tax

#36

Post by hogFeast »

vmception wrote: post #35
hogFeast wrote: post #31

Earlier quoted context omitted.

No, my point is that having a high inheritance tax leads to improved efficiency of capital markets. The Lee family have relied on literally illegal manoeuvres (they rigged a shareholder vote on an subsidiary acquisition) to maintain control, it is best that a company is guided by economic motives and not dictatorship by minority groups (again, the cost to Samsung has been substantial, that is why the company has pret…

I gotta read about this guy! His comatose film obsession is just as detrimental to his ability to make money as spending too much time with illegal sex workers. The commonality would be addiction, or more specifically neglecting other obligations. If neither of those things caused one to neglect other obligations, then there is nothing liberal and forward-thinking about not caring about the activity.

...I have come across quite a few execs with a prostitute habit...in no cases has it been unrelated to their job performance (and btw, I live somewhere where it is legal...it is usually correlated to either sex addiction and/or other addiction/compulsive behaviour).

Re: Samsung's Lee family to pay over $10.8B inheritence tax

#37

Post by gizmo686 »

hogFeast wrote: post #22
speeder wrote: post #10

Earlier quoted context omitted.

Last time I heard about this, there was some south koreans explaining this is very not nice, that the laws are silly, and can be weaponized. For example you can gift someone a expensive building right before your death, because when you do die, they will be forced to pay so much inheritance tax, that they would have to sell the building, since selling the building is quite hard, it is likely the person will just go b…

The Samsung family have been engineering this for about two decades. Lee Kun-hee was convicted twice for stuff relating to this. The issue they have is retaining control over Samsung whilst having to pay inheritance tax. This is why the stock price rose significantly when Lee actually "died", he obviously legally died before that point the coverup was to maintain control over Samsung, because it looks like they have…

I don't know about other countries, but this is one area where the US tax code makes sense. Gifts beyond a certain value ($15,000/recipient-year) are reported. You then have an $11.5M lifetime exception for paying taxes on further gifts (2020 number). When your estate goes to pay the estate tax, it also has the same exemption as the lifetime gift tax, and anything you filed against the lifetime gift tax exception is deducted from what you are allowed to claim against the estate tax exemption. In other words, the only (federal) tax benefit gift giving can provide is $15,000/recipient annual exemption, which is inherently limited.

Re: Samsung's Lee family to pay over $10.8B inheritence tax

#38

Post by bobthepanda »

msg3 wrote: post #30
vmception wrote: post #29

Earlier quoted context omitted.

Sounds like a good capital allocation by the government at the time! I'm guessing Samsung paid them back? Any sectors that the Korean government is funding well or should be funding better these days?

I'm not sure about the current situation, but I believe the loans were maintained for a long time to ensure a certain level of government control over the large Chaebols.

Most of the early stuff probably would have been wound down during 1998 when the Asian Financial Crisis brought down Daewoo and the IMF had to stabilize the government’s spending.

Re: Samsung's Lee family to pay over $10.8B inheritence tax

#39

Post by notfromhere »

vmception wrote: post #9

Seems excessive, how well is the Korean government in stewarding public resources and identifying areas of the economy to direct capital? Do they have a history of being the proper stewards of this money than a private person?

Not sure why the assumption is that governments are incompetent until proven otherwise. Capital allocation inside corporations is more opaque and byzantine; I don’t know where this idea of corporations being more efficient comes from because I don’t think anyone that’s worked at one would say it’s efficient.

Re: Samsung's Lee family to pay over $10.8B inheritence tax

#40

Post by speeder »

hogFeast wrote: post #36
vmception wrote: post #35

Earlier quoted context omitted.

I gotta read about this guy! His comatose film obsession is just as detrimental to his ability to make money as spending too much time with illegal sex workers. The commonality would be addiction, or more specifically neglecting other obligations. If neither of those things caused one to neglect other obligations, then there is nothing liberal and forward-thinking about not caring about the activity.

...I have come across quite a few execs with a prostitute habit...in no cases has it been unrelated to their job performance (and btw, I live somewhere where it is legal...it is usually correlated to either sex addiction and/or other addiction/compulsive behaviour).

I have ADHD.

A common version of ADHD happens when the person brain doesn't produce enough dopamine, so the person in question keeps seeking more, so people with ADHD often have addictive behaviour, even to stuff people didn't considered addicting at all.

But this variation of ADHD also can make the person a high performer, often the best dopamine kicks come from doing interesting work, for example coders doing new stuff or fixing really bizarre bugs, or a CEO having to navigate the company through a very tricky situation.

There is some resaeerch trying to figure out if it has a link to hunter genes (ie: people with this variation would be more inclined to hunt, and be persistant during hunting, at same time switching targets if necessary, but these adaptations make the person poor in following schedules, thus a poor farmer)

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