PhonePe’s India relocation results in $1 billion tax bill for Walmart

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Walmart Inc. and other PhonePe shareholders may be required to pay a tax of nearly $1 billion for relocating the company’s domicile from Singapore to India in October. When asked about the tax demand, Walmart confirmed that it had been served with one. “This is related to Redomicile that was announced in October,” the retail giant said. As a result of the move, PhonePe has transferred all of its businesses and subsidiaries from PhonePe Singapore to PhonePe Pvt Ltd in India, including its insurance and wealth brokering services.

PhonePe, which was acquired by Flipkart in 2016 and now has 43 crore registered users and has digitized over 35 million offline merchants, recently became a wholly India-domiciled firm. It plans to raise $1 billion this month. Both Flipkart and PhonePe announced the full separation of ownership between the two companies. In October, PhonePe also revealed that its board had approved the creation of a new employee stock ownership plan (ESOP) and the migration of over 3,000 employees’ existing ESOPs by issuing new ESOPs under PhonePe India’s plan. Under the newly liberalized automatic offshore direct investment (ODI) rules, PhonePe also transferred ownership of the recently acquired IndusOS Appstore (OSLabs Pte Ltd) from Singapore to India.