early trial 2020 0294 ( October 30, 2020)
After acquiring the land at issue as a gift, the claimant corporation returned the ownership of the donor by termination of agreement on August 25, 2017, after one year and seven months from the acquisition date (i.e., January 28, 2016). Since the land at issue was not used for the original purpose of acquisition until one year has passed from the acquisition date, the claimant corporation satisfied the requirements for additional collection under Article 11 (3) 1 of the Land Special Act at the expiration of one year from the date of acquisition of the land at issue.
Article 11 of the Restriction of Special Local Taxation Act
Cho 2015 0394
The appeal is dismissed.
1. Summary of disposition;
A. On January 28, 2016, an applicant corporation entered into a donation contract with an OO (representative of the applicant corporation) on a parcel of land 2,683 square meters and 683 square meters (hereinafter “submerged land”) and acquired it by an agricultural corporation upon filing a report of acquisition, and acquired real estate to be used for farming by an agricultural corporation upon filing an application for reduction or exemption of acquisition tax on the ground that it falls under the reduction or exemption of acquisition tax under Article 11(1) of the Restriction of Special Local Taxation Act (amended by Act No. 14477, Dec. 27, 2016; hereinafter “Special Taxation Act”).
B. Since then, the disposition authority confirmed that the claimant corporation did not directly use the land at issue for farming and revoked the registration of ownership transfer on the grounds of the cancellation of agreement on August 25, 2017 (7.31, 2017), and confirmed that it constitutes real estate acquired within five years after establishment of the corporation in a large city, such as acquisition tax, and deemed that it constitutes real estate acquired within five years after establishment of the corporation, and thus imposed an assessment and notice on the claimant corporation on October 11, 2019, on the aggregate of the acquisition tax, local education tax OO members, and special rural development tax OO members.
C. The applicant filed an appeal on December 9, 2019.
2. Opinion of the requesting corporation and the disposition agency;
A. The claimant corporation's assertion
On January 28, 2016, the OO filed an application for permission for development activities with the agency on April 5, 2016. The reason why the ownership of the land was transferred to the applicant corporation for the purpose of donation, and the reason why the ownership was transferred to the applicant corporation was that the public official in charge was informed that there was no economic burden because of the exemption of the acquisition tax, etc. of the land.
However, unlike the guidance of the public official in charge of the disposition agency, the administrative procedure of the disposition agency for the application for permission for development activities was delayed for a considerable period of time, and the application for permission was withdrawn on June 30, 2016 because permission was not granted even though it had been supplemented several times. Accordingly, the applicant corporation cancelled the registration of ownership transfer for the land at issue due to the cancellation of agreement on August 25, 2017 (.7.31.), and the applicant corporation filed a report on closure of the registration of ownership transfer on May 15, 2019, and completed the dissolution by the resolution of the general meeting of shareholders on August 23, 2019 and completed the registration of dissolution on August 27, 2019.
In order to protect and foster the farming industry under the Local Special Act, acquisition tax on real estate acquired by an agricultural corporation, etc. for farming shall be reduced or exempted, and it is applied only to the sale, donation, or use for other purposes when the period of direct use for the purpose corresponding to Article 11(3)2 of the Local Special Act is less than three years, and there is no provision for the cancellation of agreement. The cancellation of agreement is a legal act with the termination of the validity of the existing contract by mutual agreement between the parties to the contract and return to the state where the contract has not been entered into from the beginning. It is distinguishable from the sale of the property for money, etc. in that it is a transfer with the value, and there is no reasonable ground to include the reasons for the cancellation of agreement in the legislative purport. Thus, the disposition imposing acquisition tax, etc. of this case, including additional tax, shall be unlawful by expanding, interpreting or analogical interpretation
(b) Opinions of disposition agencies;
The requesting corporation claims that real estate acquired by an agricultural corporation in accordance with the purpose of legislation of Article 11 of the Land Special Act is only sold, donated or used for other purposes when it has been used directly for the relevant purpose for less than three years, and therefore, it does not constitute the subject of collection in case of cancellation of agreement;
Since acquisition tax is an act of imposing taxes on real estate acquisition at a taxable object, a taxation claim is naturally created due to the existence of a taxation requirement of such acquisition. On the other hand, after lawful acquisition, it shall not affect the exercise of a taxation claim already established even if the contract is cancelled by agreement and the property is returned (see, e.g., Supreme Court Decision 95Nu7970, Sept. 15, 1995). Even if the registration of ownership transfer of the land acquired by the claimant corporation due to agreement cancellation is cancelled, it cannot be deemed that there is an inevitable cause for invalidation at the time of initial cancellation of acquisition tax liability, so the claimant corporation cannot affect the tax liability to pay acquisition tax established lawfully under the Local Tax Act. Since the claimant corporation has already completed the registration of ownership transfer after the acquisition of the land, it is confirmed that the agreement has been cancelled after the lapse of 60 days from the date of acquisition, it is not subject to the proviso of Article 20(1) of the Enforcement Decree of the Local Tax Act, but subject to reduction of acquisition tax by additional tax pursuant to Article 1111(1).30000,700,700.1.1.71.7
3. Hearing and determination
(a) Points in dispute;
Whether the reduced or exempted acquisition tax is subject to additional collection where an agricultural corporation acquired land as a donation from the representative director and returned ownership to the representative director through the cancellation of agreement.
B. Relevant statutes
(1) Restriction of Special Local Taxation Act (wholly amended by Act No. 14477, Dec. 27, 2016)
Article 11 (Reduction or Exemption for Agricultural Corporations) (1) Acquisition tax on real estate acquired by a farming cooperative corporation under Article 16 of the Act on Fostering and Supporting Agricultural and Fisheries Enterprises or by an agricultural corporation under Article 19 of the same Act (hereafter referred to as "agricultural corporation" in this Article) within two years from the date of registration for establishment to use in farming, and registration license tax on registration for establishment of an agricultural corporation, shall be exempted until December 31, 2017, respectively.
(2) Acquisition tax on real estate acquired by an agricultural corporation to use directly for farming, distribution and processing shall be reduced by 50/100, and property tax on real estate used directly for the relevant use as of the tax base date shall be reduced by 50/100 until December 31, 2016, respectively.
(3) In applying reduction or exemption under paragraphs (1) and (2), in any of the following cases, reduced or exempted acquisition tax on the relevant portion shall be collected as a penalty:
1. Where such real estate is not used for the relevant purposes without just grounds, within one year from the date of acquisition;
2. Where it is sold, donated, or used for other purposes when it has been used directly for the relevant purposes for less than three years.
(2) Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 27710, Dec. 30, 2016)
Article 20 (Time, etc. of Acquisition) (1) In cases of acquisition by gratuitous succession, it shall be deemed that such acquisition has been made on the date of the relevant contract (referring to the date of commencement of inheritance or testamentary gift in cases of acquisition by inheritance or testamentary gift): Provided, That where the relevant acquired article is proved that the contract is rescinded within 60 days from the date of acquisition by any of the following documents without registering the relevant acquired article
1. Protocol of composition or recognition;
2. Notarial deeds, etc. prepared within 60 days from the date of acquisition.
3. Report on cancellation of a contract prescribed by Ordinance of the Ministry of the Interior which is submitted within 60 days;
C. Facts and determination
(1) The review materials submitted by the agency and the requesting corporation are as follows:
(A) On July 18, 2014, the applicant corporation is confirmed to have registered the establishment of the corporation by using the OOO as the seat of its head office, the purpose of business is farming, growing, gathering forest products, and growing seeds and seedlings for forestry.
(B) On January 28, 2016, the applicant corporation entered into a donation contract with the representative director on the land at issue and acquired it, and was exempted from acquisition tax, etc. by applying for reduction or exemption for real estate acquired by an agricultural company under Articles 11(1) and 19 of the Local Special Act.
(C) During the period between November 10, 2015 and July 19, 2017, the applicant corporation applied for a building permit on the land within a development restriction zone and appears to have withdrawn the building permit. In relation to the building permit, the applicant corporation requested the relevant department to submit documents confirming the fact of farmland cultivation in relation to the farmland diversion and repeated application for a building permit and withdrawal upon request for supplementation.
(D) The applicant corporation's cancellation of the registration of transfer of ownership on the land at issue on August 25, 2017 ( July 31, 2017) is confirmed in the complete certificate of registered matters.
(E) On May 10, 2019, the applicant corporation is confirmed by the receipt receiptOO that the director of the OOO office reported the cessation of business on January 1, 2019 and delivered by the OOOOO.
(f) The key land is a land within a development-restricted zone and appears at the Land Use Planning Confirmation Board.
(2) We examine the above facts and relevant laws and regulations comprehensively.
In full view of the provisions of Article 11(1), main sentence of Article 11(3), subparagraph 1, and subparagraph 2 of the Local Special Act, acquisition tax on real estate acquired by an incorporated farming association within two years from the date of registration of incorporation to be used for farming shall be exempted, but where such real estate is not used directly for the relevant purpose without justifiable grounds within one year from the date of acquisition, and where such real estate is sold, donated, or used for other purposes without justifiable grounds when it has been used for the relevant
In the case of a claimant corporation, the claimant corporation acquired the land as a donation and returned ownership to the donor on August 25, 2017, after one year and seven months from the acquisition date (1.28, 2016). The claimant corporation did not use the land for the original purpose of acquisition until one year has passed from the acquisition date, and since the claimant corporation acquired the land which is the land within the development-restricted zone, it can be sufficiently known that there were restrictions under the relevant Acts and subordinate statutes in order to construct a new building on such land. However, it is difficult to recognize that the claimant corporation had a legitimate reason for not being used for the purpose of acquisition within the grace period of one year only based on the opinion that it is difficult to use the land for acquisition after filing an application for a building permit to construct a new building on several issues, and therefore, the claim corporation satisfies the requirements of collection under Article 11 (3) 1 of the Special Cases Act at the expiration of one year from the date of acquisition of the land at issue, and whether the ownership was transferred to the cancellation of the agreement can be returned after the sale period after one year.
Therefore, it is judged that there is no particular error in the disposition imposing acquisition tax, etc. reduced or exempted for the key land by the disposition agency.
This case shall be decided as ordered in accordance with Article 96 (6) of the Framework Act on Local Taxes and Articles 81 and 65 (1) 2 of the Framework Act on National Taxes, since the petition for appeal is groundless as a result of the review.