[2] Whether applying the inorganic premium rate again when imposing an inorganic additional tax is double taxation (negative)

[3] Whether a taxpayer bears the burden of proving the rationality of the standard rate of income (=tax payer)

[4] The case holding that it is lawful to apply 20% of the inorganic premium rate to the taxpayer whose amount of income exceeds 300 million won by place of business

[2] Even though a policy effect leading up to entry may actually be accompanied by the application of the indefinite addition rate, the indefinite addition rate itself is one of the methods of tax base estimation and investigation to ensure that the estimation of income would be close to the actual amount by accurately reflecting the income amount according to the size of income. On the other hand, in order to facilitate the exercise of the right of taxation and the realization of the tax claim, where a taxpayer violates the bookkeeping duty, etc. as prescribed by the Act without any justifiable reason, the indefinite addition rate is an administrative sanction imposed as prescribed by the Act in order to facilitate the exercise of the right of taxation and the realization of the tax claim, and thus, it differs from the purpose and character of the system. Therefore, in determining the tax base, the indefinite addition rate cannot be applied.

[3] When the Commissioner of the National Tax Service sets a premium rate according to the size of income in determining the standard income rate specifically after deliberation by the income standard deliberation council, and when the tax authority imposes a tax disposition, it cannot be deemed that the said premium rate violates the principle of prohibition of comprehensive delegation and the principle of no taxation without law. However, there may be cases where it is not appropriate to reflect the actual amount of income by applying the differential rate determined according to the size of income based on the above provision, which is considerably unreasonable in its specific contents, but this point needs to be proved by the taxpayer who disputes the legitimacy of the taxation.

[4] The case holding that it is lawful to apply 20% of the fixed rate to the taxpayer whose amount of income exceeds 300 million won by place of business

2. Litigation costs shall be borne by the plaintiff.

The following facts are recognized if there is no dispute between the parties, or if the parties are aware of the whole purport of the pleading in each description of Eul evidence Nos. 1, 2, 3, and Eul evidence No. 5-1, 6-2.

A. The Plaintiff reported the tax base and tax amount of global income tax for the year 194, as an attorney-at-law operating a law office under 115-19, Seosan-dong 115, Chungcheongnam-dong 1994 at the port, pursuant to Article 120 of the former Income Tax Act (amended by Act No. 4803, Dec. 22, 1994; hereinafter the same shall apply) and Article 169-2 of the Enforcement Decree of the Act (amended by Presidential Decree No. 14467, Dec. 31, 1994; hereinafter the same shall apply), according to the method based on the standard income rate determined by the Commissioner of the National Tax Service, which is one of the determination methods of the estimate under Article 169-2 of the Enforcement Decree of the Act, the total amount of income 375,828,00 won, multiplied by 52.8% (basic rate) of the standard income rate of attorney-at-law's business in 1994.

B. The defendant calculated the tax base as 195,225,00 won in the immediately preceding year 15,225,000 won in the above year, and added the tax base to 150,00,000 won to 150,000 won in the above-mentioned year by filing a revised return without any entry at all as required under Article 184 (4) of the Act, and thereby subject to the application of the inorganic rate for adding 20% of the above basic rate as determined by the Commissioner of the National Tax Service, and subject to the imposition of the additional tax for insincere entry as stipulated under Article 121 (4) of the Act. In determining the business income due to the plaintiff's attorney's business income, 238,124,620 won [375,828,000 won x 197,000 won x 10.2 ＋7,197,079 won which was calculated based on this, 305,1975,297,7197 won and 197.7

2. Whether the instant disposition is appropriate;

A. Whether the standard income rate regulations are unlawful

The plaintiff asserts that it is unlawful for the defendant to determine the amount of the plaintiff's income according to the standard income rate determined by the Commissioner of the National Tax Service, because it should be done extremely exceptionally, and the estimation method should be reasonable and reasonable.

Article 120 (1) of the Act provides that the Government shall investigate and determine the tax base and tax amount by the estimation method determined by the Government through deliberation of the Income Standard Council if it is impossible to make a decision on the final tax base and tax amount, on-site investigation, or in writing due to apparent objective reasons prescribed by the Presidential Decree. Article 124 (1) of the Act provides that the Income Standards Council shall be established in the National Tax Service to deliberate on matters necessary for the final tax base return and the decision. Paragraph (3) of the same Article provides that matters necessary for its operation shall be prescribed by the Presidential Decree again, and Article 175 through 181 of the Decree provides that the matters necessary for its operation shall be prescribed by the Presidential Decree. Article 169 (1) 1 of the Decree provides that Article 120 (1) of the Decree provides that, in calculating the tax base as one of the "any obvious objective reasons prescribed by the Presidential Decree" in Article 120 (1) of the Act, if there is no necessary account books and documentary evidence or material parts are incomplete or false, Article 169-2 (1) 1) of the Decree provides that the average income ratio is one of the standard type of business.

As seen above, the relevant Acts and subordinate statutes stipulate that the government shall make a standard income rate through the deliberation of the Income Standards Council, but the specific method was delegated to the government. In light of the fact that the standard income rate is not a taxation requirement but only the ratio of income to the income to be applied to the decision of estimation of tax base, it cannot be deemed invalid or unlawful (see Supreme Court Decision 96Nu12054 delivered on September 9, 1997), and if the whole purport of argument is gathered in the statement in subparagraph 5-1, 2, and 3, the Commissioner of the National Tax Service did not hold the Standard Income Council on March 15, 1995 to promote the normal taxation of the category of business in which income is realized, the fact that the standard income rate is adjusted to 52.8% of the standard income rate for the bar business in 194, and the above standard income rate cannot be viewed as unlawful if the above standard income rate is not a different one, the plaintiff's tax base or the above standard income rate cannot be viewed as unlawful.

(b) Whether double taxation is levied;

The Plaintiff asserts that the provision on the additional rate for an indefinite and the provision on the additional rate for an indefinite and the provision on the additional tax for an indefinite is a provision to punish a person liable for bookkeeping to not make an entry or to make an unfaithful entry, and that the application of the additional rate of 20% on the ground of an indefinite entry is unlawful because the Plaintiff’s application of the additional rate for an indefinite based on an indefinite entry is contrary to the principle of substantial taxation and it is unlawful

Article 121(4) of the Act provides that where a person obliged to book-keeping by double-entry or a person obliged to book-keeping by double-entry fails to keep and record the relevant books or where the income amount in the books kept and recorded falls short of the amount to be entered, the calculated tax amount shall be added to the amount equivalent to 10/100 of the amount calculated by multiplying the calculated tax amount by the ratio of the relevant income amount not entered in the books or the relevant income amount short of the amount to be entered in the books, and Article 169-2(3) of the Decree provides that the Commissioner of the National Tax Service may determine the standard income rate in determining the rate of income, one of the reasons is that the difference between the amount of income amount and the amount of income amount is added to the calculated tax amount. Thus, it is reasonable to apply the same differential rate as the additional rate to the person liable for book-keeping by double-entry or book-keeping by the size of income exceeding a certain standard.

However, even if the policy effect leading up to entry may actually be accompanied by the application of the indefinite additional rate itself, the indefinite additional rate itself is one of the method of tax base estimation and assessment prescribed in order to make the estimation of income close to the actual amount by accurately reflecting the income amount according to the size of income. On the other hand, Article 121(4) of the Act provides that in order to facilitate the exercise of the right of taxation and the realization of tax claims, in cases where a taxpayer violates bookkeeping duties, etc. as prescribed by the Act without a justifiable reason, an administrative sanction imposed as prescribed by the Act and the nature of the system differs from each other. Thus, in determining the tax base on the grounds that the inorganic additional tax is imposed, the inorganic additional rate is not applicable, so the Plaintiff’s above assertion is without merit.

C. As to the subject of the application of an indefinite addition rate

The plaintiff asserts that the application of the inorganic premium rate equivalent to 20% of the above basic rate based on the amount of income 300,000,000 won is arbitrary determination without any objective basis or data in selecting the subject of application, and that it is unlawful against the principle of substantial taxation and the principle of no taxation without law.

In light of the above, when the Commissioner of the National Tax Service determines the premium rate according to the size of income in determining the standard income by deliberation by the income standard deliberation council, and when the tax authority imposes a tax disposition, it cannot be deemed that the said premium rate violates the principle of prohibition of comprehensive delegation and the principle of no taxation without law. However, there may be cases where it is not appropriate to reflect the actual amount of income in the calculation of the amount of income as a result of the application of the differential rate determined according to the size of income based on the above provision. However, this point needs to be proved by the taxpayer who contests the legitimacy of the taxation (see Supreme Court Decision 96Nu12054 delivered on September 9, 197).

However, if Eul evidence Nos. 5-1, 2, and 3 are gathered all the arguments, the Commissioner of the National Tax Service may hold a Income Standard Council on March 15, 1995 and determine to apply the above additional rate to a business operator who either files a false return or makes an estimation of the amount of income by either an individual or a corporation in excess of 300,000,000 won or by estimation of the amount of income at the expense of bookkeeping, according to the determination to apply the additional rate equivalent to 20% of the basic rate by the pertinent type of business. Thus, in light of the fact that the revenue amount of 300,000,000 won is a considerable high-income earner and is subject to double-entry bookkeeping pursuant to Article 184(3) of the Act, it is reasonable to apply the above additional rate on the basis of the above amount as well as to make it difficult for the plaintiff to prove that there is no reason for the plaintiff's above assertion.

4. Conclusion

Therefore, the plaintiff's claim seeking revocation is dismissed as it is without merit, and the costs of lawsuit are assessed against the losing plaintiff. It is so decided as per Disposition by the assent of all participating Justices.

Judges Choi Su-su (Presiding Judge)