Judge rules businessman Eric Watson owes $51.1 million in back taxes

Eric Watson last year
Eric Watson last year Photo credit: File

Businessman Eric Watson lost a long running dispute with Inland Revenue, with a High Court Judge ruling companies he owns are liable to pay $51.1 million in back taxes.

Justice Matthew Palmer ruled a transaction in 2002 - involving Cayman Island companies while Watson was relocating to the UK - was an avoidance arrangement, reports NZME.

Watson's Cullen Group is liable for back taxes, plus interest and penalties.

During a trial last year, the court heard Inland Revenue calculated interest costs alone at $60.5 million.

Justice Palmer said penalties have yet to be quantified, NZME reported. 

Last year, Watson was ordered by a UK court to pay close to $50 million NZD, after being taken to court by Sir Owen Glenn and Kea Investments over a joint European property venture called Spartan Capital.

The court found Watson had "planned and orchestrated" a scheme to trick Kea into entering agreements.

Kea invested £129 million into Spartan Capital.

Watson did not appeal the judgment, and was ordered to make an interim payment, as well as paying court costs.