FRANKFURT (Reuters) - The Hainan Chihang Foundation, a charity linked to Chinese airline-to-property conglomerate HNA Group [HNAIRC.UL], is not seeking a tax exempt status, it said on Sunday.
Responding to a report in German weekly Wirtschaftswoche which said that the U.S. tax authorities would likely deny a such tax exempt status, a spokesman for the charitable foundation said that the Hainan Chihang Foundation was incorporated and would comply with all tax laws.
Wirtschaftswoche reported, citing unnamed sources, that the tax exempt status had been denied due to HNA’s unclear ownership structure. The foundation spokesman said: “These ‘insiders’ were speaking speaking out of turn.” [nL3N1NG5UB]
Tax exemption is usually sought by U.S. charities as it shields their funds - and their donors - from the taxman, leaving more resources for philanthropy.
Earlier this month, HNA Co-Chairman Wang Jian died during a business trip in France. His death complicates the troubled conglomerate’s efforts to restructure and pay off borrowings, and could increase pressure on HNA to reveal more about its opaque ownership. [nL4N1U030R]
Wang is regarded as the architect of a $50 billion acquisition spree during which HNA accumulated assets ranging from a stake in Deutsche Bank (DBKGn.DE) to high-profile overseas properties. Under pressure from Beijing, HNA has since sold off many of those assets to slash debt.
Reporting by Arno Schuetze. Editing by Jane Merriman