[2] Whether the construction site for national housing subject to exemption from capital gains tax under the former Regulation of Tax Reduction and Exemption Act includes the site for necessary incidental facilities and welfare facilities (affirmative)

[2] The construction site for national housing under Article 62 (1) of the former Regulation of Tax Reduction and Exemption Act (amended by Act No. 4165 of Dec. 30, 1989) is a concept that includes not only the site for multi-family housing, but also the site for incidental facilities and welfare facilities to be mandatorily installed. The site for a kindergarten, a welfare facility, and a building site for a commercial building shall not be a case where national housing is not constructed on the pertinent land, which is the reason for collection equivalent to the amount of exempted tax under Article 62 (2) of the former Regulation of Tax Reduction and Exemption Act, while implementing a national housing construction project.

Article 62 (1) (proviso) and (2) of the former Regulation of Tax Reduction and Exemption Act (amended by Act No. 4165 of Dec. 30, 1989), where a national transfers a parcel of land to an end-user such as a registered housing constructor under the Housing Construction Promotion Act, capital gains tax or special surtax shall be exempted, and where such an end-user fails to construct national housing on the relevant parcel of land under the conditions as prescribed by the Presidential Decree, the legislative purpose of Article 62 (1) (proviso) and (2) of the same Act provides that an amount equivalent to the exempted tax shall be added to income tax or corporate tax to facilitate the construction of national housing by supplying the site for national housing at a low price (see, e.g., Supreme Court Decisions 9Nu16199, Jun. 13, 1995; 94Nu8440, Dec. 12, 195; 203Da1325, supra, the Housing Construction Promotion Act’s construction site and its incidental facilities under the Housing Construction Promotion Act shall not be implemented.

In the same purport, the court below is just in holding that the amount equivalent to the exempted tax amount on each part of the lands of kindergartens and commercial buildings, which are auxiliary facilities and welfare facilities which must be installed mandatorily under the Housing Construction Promotion Act, is not subject to collection under the above Tax Reduction and Exemption Control Act, and there is no error of law by misunderstanding legal principles as argued in the Grounds for Appeal, and the precedents of party members cited in the Grounds for Appeal are not appropriate to invoke the case

Therefore, the appeal is dismissed and all costs of appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Lee Im-soo (Presiding Justice)