Walmart paid most of $1 billion tax for PhonePe shifting base to India

By Nandan Mandayam

BENGALURU (Reuters) – Walmart Inc late on Wednesday confirmed that it had already paid the Indian government most of the nearly $1 billion in tax owed after digital payments company PhonePe, which the U.S. retailer owns through Flipkart, shifted its headquarters from Singapore to India.

Walmart bought a controlling stake in Indian ecommerce giant Flipkart in 2018, giving it ownership of PhonePe. The company said last month it had completed the separation of PhonePe from Flipkart, adding that it would remain a majority stakeholder in both the companies.

“Walmart has already paid most of the 78 billion rupees ($943.01 million)that was incurred as a capital gains tax after PhonePe investors sold their stake in the Singapore entity and invested in the Indian entity following the domicile change,” a source with direct knowledge of the matter had told Reuters.

Walmart did not give any other details on the payment.

A PhonePe spokesperson in a statement confirmed that Walmart and other investors paid the capital gains tax bill, adding it was the “right long-term strategy.”

Moneycontrol reported last year PhonePe was raising funds at a $12 billion valuation in a round led by General Atlantic. The fintech firm was last valued at about $5.5 billion in December 2020.

Bloomberg News previously reported that Walmart and other PhonePe investors would have to pay nearly $1 billion after its domicile change.

($1 = 82.7140 Indian rupees)

(Reporting by Nandan Mandayam in Bengaluru; Editing by Shounak Dasgupta and Nivedita Bhattacharjee)