Article 12 (Exemption from Value-Added Tax)

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

A. The plaintiff is a corporate entity that started business on December 18, 2003 with the business type as "forest/forest business" and started business on December 18, 2003, and engages in forest tending business, etc. (hereinafter "the project in this case") according to the contract for forest projects entered into with ○○ Military during the taxable period from January 2004 to 271 as shown in the attached Table of the project (hereinafter "the contract in this case"), and did not issue an invoice under Article 163 of the Income Tax Act by treating the price received from ○○ Military as the object of value-added tax exemption.

B. On February 11, 2008, the Defendant deemed that the business of this case constitutes a taxable object of value-added tax and notified the Plaintiff of the amount calculated by dividing the value-added tax by 1.1 (the total amount of value-added tax expected during the taxable period by 94,91,818 won, 271 minute 432,181,818 won, 2704, 271 minute 432,181,818 won, 2704, 271 minute 98,289,090 won, 171 minute 98,289,090 won, and 187,503,636 won during two years in 2005) by the omitted amount of tax return.

C. On March 13, 2008, the Plaintiff appealed and filed a request with the Defendant to review the legality of the taxation prior to taxation. However, on April 8, 2008, the Defendant issued a non-adopted decision on June 2, 2008, and notified the Plaintiff of KRW 15,092,290 for the first term portion in 2004, KRW 66,279,400 for the second term in 2004, KRW 14,539,90 for the first term in 2005, and KRW 26,702,390 for the second term in 205, respectively (hereinafter “instant disposition”).

D. The Plaintiff appealed and filed a request for examination with the Commissioner of the National Tax Service on July 17, 2008, but the Commissioner of the National Tax Service dismissed the said request for examination on October 22, 2008.

[Ground of recognition] Facts without dispute, Gap evidence 1, 2, 3 (including branch numbers, hereinafter the same shall apply), Eul evidence 1 to 6, the purport of the whole pleadings

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

(1) Since the instant project is a project that is naturally incidental to the supply of services related to forest products and that is exempt from value-added tax, the instant disposition that imposes value-added tax on the instant project is unlawful.

(2) At the time of the instant contract, ○○○○-gun entered into a contract on the premise that the instant project is subject to value-added tax exemption, and the Defendant also did not impose tax on the instant project for several years, thereby making a public statement that the instant project is subject to tax exemption. As such, the instant disposition was unlawful as it violates the principle of good faith and the principle of protection of trust and trust.

(b) Related statutes;

(Omission)

C. Determination

(1) Whether the instant business is subject to value added tax

(A) Articles 1, 2, and 7 of the Value-Added Tax Act impose value-added tax on a transaction of supply of goods or services. The taxpayer is a person who independently supplies goods or services for a business purpose, and the supply of services is a contractual or legal person in return for a price.

The provision of services or the use of goods, facilities or rights, and the supply of goods or services, which are the main transaction, is deemed to be included in the supply of goods or services, and Article 12 (1) 1 of the same Act provides that the supply of forest products is exempt from value-added tax.

(B) On the instant case, as seen earlier, the Plaintiff is a corporate entity established for the purpose of forest project, such as afforestation, forestation, and natural recreation forest development project, and the Plaintiff entered into a forest project contract with ○○ Military, the ordering entity, and received the price for the instant project, which is a forest project, by providing its services after concluding the forest project contract with ○○ Military, which is an ordering entity. Therefore, the instant project is subject to value-added tax

In addition, the business of this case does not fall under the supply of services essential to the supply of forest products, rather than the supply of goods that are forest products, and thus, it cannot be viewed as the business exempt from value-added tax pursuant to Article 12 (1) of the Value-Added Tax Act. Thus,

(2) Whether the principle of trust and good faith and the principle of trust protection are violated

○○○-gun entered into a contract on the premise that the instant project is subject to value-added tax exemption, or that the Defendant did not impose tax on the instant project for several years, cannot be deemed to have made a statement of view that the instant project constitutes a tax exemption subject, and there is no other evidence to support that the Defendant issued a public statement of opinion that the instant project constitutes a tax exemption subject, and there is no reason to support this part of the Plaintiff’s assertion.

3. Conclusion

Therefore, the plaintiff's claim of this case is dismissed as it is without merit, and it is so decided as per Disposition.