Ex Thai PM’s children are ordered to pay taxes for their BVI company’s deals
Two children of ex-Prime Minister of Thailand Thaksin Shinawatra have been ordered by anti-graft authorities to pay US$616 million (20 billion baht) in outstanding taxes and fines, from the last year sale of Thaksin’s telecom giant Shin Corp. to Singapore’s government’s Temasek Holdings, for 73.3. billion baht (US$2.3 billion).
The transactions of BVI-owned Shin Corp. have been traced starting from November 2006, when lawyers and taxmen insisted on the taxation of capital gains realized from the sale of company’s shares. These deals connected with Temasek Holdings-Shin Corporation and British Virgin Islands-registered Ample Rich Investments Co Ltd. evoked sharp reaction of the public and investigators.
The sale of Shin Corp. to Temasek, on which the family earned 1.9 billion dollars, was structured to avoid paying any taxes; the ex-Prime minister claimed that the sale was completely legal. However, the corruption investigators ruled that Thaksin’s two children had avoided paying taxes owed by their holding company, BVI-domiciled Ample Rich.
According to the current information provided by the Assets Examination Committee, Pintongta and Phantongtae Shinawatra set up a BVI company as part of the scheme to avoid paying taxes on the sale. They sold the shares of Shin Corp., owned by Ample Rich, to themselves at a price of 1 baht each, before selling their controlling stake in Shin Corp. to Temasek at 49 baht a share.
Actually, only after the deal was finished it was discovered that they were the owners of Ample Rich. AEC decided they should pay the tax because Ample Rich is a foreign company operating in Thailand.