2. The costs of lawsuit shall be borne by the Plaintiff.

A. On December 24, 2001, the Plaintiff registered as a general taxable person and leased ○○○○-si 215-6 ground cartels (hereinafter referred to as “the instant cartels”) to △△△△△△△, and had ○○○○ transfer all facilities, such as furnitures and fixtures, to ○○○ on December 24, 2001, and filed a report on the closure of business on December 28, 2001, and ○○○ operated the said cartels by way of leasing them to △△△△△△△, just as it registered as a simplified taxable person on December 30, 201.

B. On January 3, 2005, the Defendant imposed value-added tax of KRW 46,125,000 on the Plaintiff in 2001 (hereinafter “instant disposition”) on the ground that the said transfer constitutes not a comprehensive transfer of business that maintains the identity of the business, but a simple supply of goods due to a change in the type of taxation (hereinafter “instant disposition”).

【Ground for Recognition: Facts without dispute, Gap 1, 2 evidence, each entry of Eul 1 through 3, the purport of the whole pleadings】

2. Determination of legality of the instant disposition

A. The plaintiff's assertion

The instant transaction between the Plaintiff and ○○○ constitutes a general taxable person, in light of the value of the tenant’s supply, and thus, the substance of the instant transaction constitutes a comprehensive quantity and water supply of the general taxable person’s business.

(b) Related statutes;

It is as shown in the attached Form.

C. Determination

According to Article 6(6)2 of the Value-Added Tax Act and Article 17(2) of the Enforcement Decree of the same Act, a transfer of business is not deemed a supply of goods, but is exempt from taxation, except for cases where a general taxable person transfers a business to a simplified taxable person. The purport of the Value-Added Tax Act is that the transfer of business does not correspond to the intrinsic nature of the supply of value-added tax, which serves as a taxation requirement for the individual supply of specific goods, and that the transfer of business does not correspond to the intrinsic nature of the supply of value-added tax, as well as that of the transaction amount and the amount of value-added tax related thereto, which is anticipated for the transferee to receive the input tax deduction without any exception, and thus, the transfer of business that is not considered a supply of goods is connected to the tax or economic policy consideration that makes the transferee take place unnecessary pressure and avoid it. Thus, the transfer of business that is not considered a supply of goods refers to the comprehensive transfer of business property for each place of business to replace only the main body while maintaining homogeneity between the parties to the business (see Article 2017(20).2).

However, as recognized earlier, the Plaintiff registered as a general taxable person, and transferred the franchise to ○○ on December 24, 2001, while engaging in the franchise business through a lessee, and ○○○ registered as a simplified taxable person on December 30, 201, and operated the franchise. As such, the said transfer does not constitute a comprehensive transfer of business, the identity of which is maintained due to a change in the type of taxation, and thus, the instant disposition is lawful.

In addition, the issue of whether the type of taxation is a general taxable person at the time of business registration, and whether it is a simplified taxable person is subject to the decision of the applicant, and the defendant is bound to accept the application of the business operator unless it falls under the exception business under Article 25(1) of the Value-Added Tax Act and Article 74(1) and (2) of the Enforcement Decree. In addition, even if the proceeds from supply are determined or corrected as a general taxable person, it shall be deemed a simplified taxable person until the taxable period to which the date of decision or correction belongs (Article 25(

3. Conclusion

Therefore, the plaintiff's claim is dismissed as it is without merit. It is so decided as per Disposition.

Related Acts and subordinate statutes

/ Value-Added Tax Act

Article 3 (Taxable Period)

(1) The taxation of value-added taxes on an entrepreneur shall be as follows:

First period: from January 1 to June 30; and

2. Second period: from July 1 to December 31.

(2) The first taxable period for a person who starts a new business shall be from the business commencing date to the ending date of the taxable period whereto belongs the date of business: Provided, That where a registration is made under the proviso of Article 5 (1), it shall be from the registration date to the ending date of

Article 6 (Supply of Goods)

(6) Any of the following subparagraphs shall not be deemed the supply of goods:

2. Transfer of business as prescribed by the Presidential Decree, except in case where an entrepreneur delivers a tax invoice under Article 16, and as prescribed by the Presidential Decree.

Article 25 (Simplified Taxation)

(1) With respect to any individual entrepreneur (hereinafter referred to as a “simplified taxable person”) whose proceeds (referring to proceeds including the value-added tax; hereinafter referred to as “ proceeds from supply”) from the supply of goods and services in the immediately preceding calendar year fall short of the amount prescribed by the Presidential Decree within the limit of not less than 48 million won and not more than the amount equivalent to not more than 130/100 of such amount, the value-added tax shall be imposed and collected pursuant to this Chapter, notwithstanding the provisions of Chapters IV through VI: Provided, That the same shall not apply to any entrepreneur prescribed by

(2) With respect to any individual entrepreneur who has newly commenced a business in the immediately preceding or immediately preceding taxable period, the provisions of paragraph (1) shall apply on the basis of the amount converted into 12 months from the date of commencing such business and ending the end of such taxable period. In this case, if there is any fraction less than one month,

(3) In the case that the total sum of the proceeds from supply is anticipated to fall short of the amount provided for in paragraphs (1) and (2) in one calendar year including the day on which a new business commences, a private entrepreneur, along with the registration provided for in Article 5 (1), shall report to the head of tax office having jurisdiction over the

(4) Any individual entrepreneur who has made a report under paragraph (3), shall be a simplified taxable person in the first taxable period: Provided, That this shall not apply to an entrepreneur falling under the proviso of paragraph (1).

(5) In one calendar year in which an individual entrepreneur who does not make a registration under the provisions of Article 5 (1) falls, and the total amount of the proceeds from supply falls short of the amount prescribed in paragraphs (1) and (2), it shall be a simplified taxable person in the first taxable period.

(6) An individual entrepreneur whose proceeds from supply determined or corrected pursuant to the provisions of Article 28 (1) are above the amount provided for in paragraph (1) shall be deemed a simplified taxable period up to the taxable period including the day of such determination

Article 26 (Tax Base and Tax Amount)

(1) The tax base for the simplified taxable person shall be the proceeds from supply.

(2) For any simplified taxable person, the amount calculated by the following formula shall be the payable tax amount. In this case, where two or more categories of business are concurrently operated, the total amount calculated by each category of business shall be the

Tax amount to be paid = 10/100 of the value added ratio as prescribed by the Presidential Decree within the scope from 10/100 to 50/100 in consideration of the average value added ratio, etc. by business type whose return has been filed for the immediately preceding three years in the corresponding taxable period.

【Enforcement Decree of the Value-Added Tax Act

Article 17 (Provision of Security, Transfer of Business and Payment of Taxes in Kind)

(2) For the purpose of the main sentence of Article 6 (6) 2 of the Act, the term “those as prescribed by the Presidential Decree” means comprehensively succeeding to all rights and obligations with respect to the business to each place of business (including the cases of division meeting the requirements under Article 46 (1) of the Corporate Tax Act, but excluding the cases where a general taxable person transfers the business to a simplified taxable person).

(3) Matters necessary for the scope and types of losses under the provisions of paragraphs (1) and (2) shall be prescribed by the Presidential Decree.

Article 74 (Scope of Simplified Taxation)

(1) The term "amount prescribed by Presidential Decree" in the main sentence of Article 25 (1) of the Act means 48 million won.

(2) A businessman as prescribed in Article 25 (1) 2 of the Act means a person who runs a business falling under any of the following subparagraphs:

1. Mining business;

2. Manufacturing business: Provided, That any business prescribed by the Ordinance of the Ministry of Finance and Economy which mainly supplies goods to end-consumers shall be excluded;

3. Wholesale business (including the case of concurrently running retail business, but excluding the business of collecting and selling materials for recycling);

4. Real estate trading; and

5. A business operating a taxable entertaining place falling under Article 1 (4) of the Special Consumption Tax Act, as prescribed by the Ordinance of the Ministry of Finance and Economy

6. Real estate rental determined by the Ordinance of the Ministry of Finance and Economy.

7. Lawyer services, inquiry counsel services, patent attorney services, certified judicial scrivener services, certified public accountant services, certified tax accountant services, tax accountant services, business guidance services, technical guidance services, appraisal and assessment services, customs clearance services, technical services, architecture services, ferry business, measurement services and other similar services prescribed by the Ordinance of the Ministry of Finance and Economy.

8. Standards determined by the Commissioner of the National Tax Service in consideration of the location, business type, scale, etc.