2. The costs of appeal shall be borne by the Defendant.

3. The decision of the court of first instance was modified as follows by means of the reduction of claims in the previous trial before remanding.

The defendant's disposition of imposing value-added tax on the plaintiff on January 19, 2002 and February 1, 2002 of the same year in excess of the tax amount set forth in paragraph (4) of the attached Form No. 3 shall be revoked.

The part of the imposition disposition of value-added tax by the Defendant against the Plaintiff on January 19, 200 and February 1, 2002, which exceeds the tax amount set forth in paragraph (4) of the attached Form No. 3, shall be revoked (the Plaintiff reduced its claim before remand).

2. Purport of appeal

The judgment of the first instance is revoked. The plaintiff's claim is dismissed.

This Court's reasoning is the same as the corresponding part of the judgment of the court of first instance. Thus, this Court's reasoning is acceptable in accordance with Article 8 (2) of the Administrative Litigation Act and Article 420 of the Civil Procedure Act.

2. Whether the instant disposition is lawful

The reasons for this court's explanation concerning this part are as follows: (a) although the above transaction of the Plaintiff's household affairs, after the fourth 13th th th th th th th th 13th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th, the Defendant maintained the practice of tax-free th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th th 20.

“Determination.”

Under the value-added tax system, the application of zero tax rate is recognized as a general rule only for exports in accordance with the consumption tax principle under the General Agreement on Tariffs and Trade (GT) in order to levy and collect value-added tax on the aspect of production and supply in international trade of goods or services and to prevent double taxation in the event that value-added tax is levied again in the country of importation. In the case of domestic consumption, it is recognized as exceptional and restrictive only for exports in accordance with the national policy purpose of foreign exchange management and collection order of value-added tax, to the extent that it does not impair foreign exchange management and collection order.

However, Article 11(1)4 of the Value-Added Tax Act provides that the goods or services for acquiring foreign currencies other than those under subparagraphs 1 through 3 shall be subject to zero-rate tax rate as prescribed by the Presidential Decree. Accordingly, Article 26(1)1 of the former Enforcement Decree of the Value-Added Tax Act (amended by the Presidential Decree No. 17041 of Dec. 29, 200) which applies to the Value-Added Tax taxable period of the Value-Added Tax Act provides that the goods or services for acquiring foreign currencies shall be supplied to non-residents or foreign corporations having no domestic place of business in Korea and shall be paid in Korean currency at a foreign exchange bank (amended by the Presidential Decree No. 17460 of Dec. 31, 201). Article 26(1)1 of the former Enforcement Decree of the Value-Added Tax Act (amended by the Presidential Decree No. 17460 of Dec. 31, 2001) provides that the price shall be paid in Korean currency at a foreign exchange bank.

In addition, General Rule 11-26-3 of the Value-Added Tax Act provides that where goods or services are supplied in Korea to a person designated by a non-resident or foreign corporation having no domestic place of business and the price is paid in Korean currency through a foreign exchange bank from the relevant non-resident or foreign corporation, the zero tax rate shall apply in cases where the price is deducted from the amount to be paid to the relevant non-resident or foreign corporation. However, General Rule of the Value-Added Tax Act provides that the tax rate shall apply in cases where the price is deducted from the amount to be paid to the relevant non-resident or foreign corporation. However, General Rule of the Value-Added Tax Act is merely an administrative rule that issued the criteria for interpretation and enforcement of the tax law within the tax authority, and it is not an effective law that binds the court or the national (see, e.g., Supreme Court Decision 92Nu7580, Dec. 22, 1992). General Rule 11-26-4 of the Value-Added Tax Act provides that the above zero tax rate shall not be applied.

Examining the above facts in light of the above legal principles, all of the transactions subject to the taxation of this case were conducted in the form of receiving the price from the United States Orac by means of supplying Orac to the Republic of Korea designated by the United States Orac under a contract with the United States Orac that the plaintiff had no business place in Korea, deducting and settling the amount to be paid to the United States Orac separately, and thus, the transaction of this case does not constitute zero-rate tax rate as stipulated in the above VAT Act.

However, since the issue is whether the Defendant’s disposition violates the principle of good faith or retroactive taxation under tax law, Article 15 of the Framework Act on National Taxes provides that “A taxpayer shall perform his/her duties in good faith.” Article 18(3) of the Framework Act on National Taxes provides that “after the interpretation of tax law or the practice in tax administration has been generally accepted by taxpayers, any act or calculation according to such interpretation or practice shall be deemed legitimate, and no tax shall be imposed retroactively by new interpretation or practice.” In order to apply the principle of good faith under Article 15 of the Framework Act on National Taxes to the tax authority’s acts in tax law or to establish non-taxable practice under Article 18(3) of the same Act, it should be construed that the tax authority has not imposed taxes on any matter over a long-term period, and that there should be no intent to impose taxes on the taxpayer, and that there should be no specific intent to do so externally or implicitly, and that it should not be interpreted to have been accepted by the general taxpayer under Article 18(3)9 of the Framework Act on National Taxes (see Article 98(3 of the Framework Act on National Taxes).

However, comprehensively taking account of the purport of each statement in Gap evidence 10-1, 2, and 11-5 through 11, and Gap evidence 12, the National Tax Service established and implemented a set-off rule with the content that "if the plaintiff provides goods or services to a nonresident or foreign corporation with no domestic place of business or deducts the price from the amount to be paid to the nonresident or foreign corporation, it shall be subject to zero-rate tax," and after 1985, it shall be deemed that the plaintiff provided goods or services to the non-resident or foreign corporation with no domestic place of business for a long time, and it shall not be subject to zero-rate tax rate, and it shall not be subject to zero-rate tax rate, nor be subject to zero-rate tax rate, nor shall it be subject to zero-rate tax rate, nor shall it be subject to zero-rate tax rate, even if the plaintiff provided services to the non-resident or foreign corporation with no domestic place of business for more than 2 years after 1989, and it shall not be subject to zero-rate tax rate."

However, the transaction of this case was received in the way that the plaintiff provided services to the Republic of Korea designated by the U.S. Oracle at the request of the U.S. Oracle and deducted the price from the debt to the U.S., and the application of zero-rate tax rate under the Value-Added Tax System is in principle recognized only for exports in international trade of goods or services, but it is exceptionally recognized as an exception to domestic consumption in accordance with the national policy purpose of the encouragement of foreign exchange earnings, and there is no basis to regard the case of the supply of goods or services to a foreign corporation if the foreign exchange earnings are actually made. Accordingly, the case of the transaction of this case may also be included in the above non-taxation practice by applying both general rule 11-26-3 and 11-26-4 of the Value-Added Tax Act and all of the above non-taxation practice. Accordingly, the defendant's disposition of this case is unlawful against the principle of good faith or the principle of prohibition of retroactive taxation by new interpretation.

3. Conclusion

Therefore, the judgment of the court of first instance is eventually justified, and the defendant's appeal is dismissed as it is without merit. It is so decided as per Disposition.

【Contents of Imposition Disposition omitted】

Judges Park Jong-dae (Presiding Judge)