One of the largest retail player Walmart has reportedly paid Rs 7,439 crore tax on the payments the company made to acquire the shares of 10 major shareholders of Flipkart. Various shareholders of Flipkart including the major ones like SoftBank, Naspers, venture fund Accel Partners and eBay, had sold their holdings to Walmart.
On the last date for depositing taxes with the Indian authorities that is on 7th September, Walmart paid Rs 7,439 crore withholding tax on payments made to 10 shareholders of Flipkart.
“Of the 44 shareholders in Flipkart who have sold shares, Walmart has deposited taxes for only 10 funds and entities. We have asked Walmart to explain the rationale followed while deducting or not deducting taxes from the shareholders. They have been asked to give a case to case explanation,” a tax department official stated.
Talking about Flipkart, the company’s shareholders can broadly be divided into three categories including foreign investors that hold more than 5 percent, foreign investors with a holding of less than 5 percent and Indian residents.
The acquisition that Walmart made was of 77 percent stake in Flipkart for about $16 billion in mid-August. For this, Walmart had to deduct withholding tax on payments made to sellers and deposit it with the Indian authorities.