Walmart gets $1 billion tax bill for PhonePe shift to India

Walmart Inc. and other PhonePe shareholders will have to pay nearly $1 billion in tax after the digital payments company shifted its headquarters to India, according to people familiar with the matter. The bill stems from the relocation and rise in value of PhonePe Pvt, which Walmart took majority ownership of after acquiring parent outfit Flipkart Online Services Pvt. Now separated from Flipkart and re-domiciled from Singapore to India, the fintech firm is raising funds at a $12 billion pre-money valuation from General Atlantic, Qatar Investment Authority and others, triggering the hefty charge, the people said, declining to be named discussing a private matter.

Investors including Tiger Global Management have now purchased shares of PhonePe in India at the new price, leading to tax implications of roughly 80 billion rupees for existing shareholders, one of the people said. Representatives of Walmart, Flipkart and Tiger Global did not immediately respond to emails seeking comment. A PhonePe spokeswoman declined to comment.