U.S. e-commerce giant Walmart has confirmed that it had already paid the Indian government most of the nearly $1 billion in tax owed after digital payments company PhonePe shifted its headquarters from Singapore to India, per a Bloomberg report.
The bill stems from the relocation and rise in the value of Walmart-owned PhonePe, 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 investors, leading to the heafty tax implications of roughly ₹80 billion for existing shareholders.
PhonePe shifting its headquarters to home - back to India, where Flipkart is based - is an unusual step. For years, technology companies with the bulk of their operations and business in India have chosen to incorporate in Singapore because of the friendlier tax regime, ease of getting foreign investments and simpler processes for public debuts on foreign exchanges. Report has it that over 8,000 Indian startups been incorporated in Singapore since 2000.
PhonePe’s shift could however be a predecessor to the digital payments company preparing for a stock market listing in India as payments firm listed overseas struggled to get a green light from India’s financial and banking regulator.