Whether Article 124-2(1) of the Enforcement Decree of the Corporate Tax Act, which provides that the excess amount shall be deducted from the gains on transfer of other transferred assets only where the total sum of the acquisition value of transferred assets and the transfer cost exceeds the transfer value (negative)

The provisions of Article 59-2 of the Corporate Tax Act shall not be construed as "transfer margin of other transferred assets up to the amount calculated by deducting the transfer margin from the transfer margin of other transferred assets, in case where the transfer margin is calculated by calculating the transfer margin of assets transferred by a corporation for each of its assets, and the purport that the transfer of assets without the transfer margin should be excluded from the subject of the imposition of the special surtax, even if a corporation transfers several assets in a taxable year, and the purport that only the transfer of assets subject to the transfer margin should be subject to the imposition of the transfer margin should be deducted from the transfer margin of other transferred assets up to the amount deducted from the transfer margin of the transferred assets, and as such, Article 124-2 (1) of the Enforcement Decree of the Corporate Tax Act, which shows to the effect that the acquisition value and the total sum of transfer margin exceed the transfer margin of the assets without the transfer margin of other transferred assets, especially in case where the excess amount exceeds the transfer margin of the transfer margin of the transferred assets by taking account of the corporation's losses, is extended

Article 59-2 of the Corporate Tax Act, Article 124-2(1) of the Enforcement Decree of the Corporate Tax Act

Korea Heavy Industries Co., Ltd. (Law Firm Central Patent Office, Attorneys Seo-ho et al., Counsel for the defendant-appellant)

Head of Changwon Tax Office

Daegu High Court Decision 89Gu849 delivered on January 12, 1990

The appeal is dismissed.

All costs of the lawsuit shall be borne by the plaintiff.

We examine the grounds of appeal.

The grounds of appeal are as follows: (a) Article 59-2(1) of the Corporate Tax Act provides that the tax base of special surtax shall be the transfer marginal profits accruing from the transfer of land, etc.; and (b) Article 59-2(3) provides that the transfer marginal profits shall be the amount calculated by deducting the amount calculated by multiplying the transfer marginal profits by the ratio and holding period as determined by the Presidential Decree (the so-called “rate increase rate”) from the acquisition value of land, etc.; and (c) Article 124-2(1) of the Enforcement Decree of the Corporate Tax Act provides that the transfer marginal profits of a corporation shall be calculated by deducting the transfer marginal profits from the transfer marginal profits of the corporation to the business year without delegation by Article 59-2(1) of the Corporate Tax Act; (b) provides that the transfer marginal profits shall be calculated by deducting the transfer marginal profits from the transfer marginal profits of the corporation to the effect that the transfer marginal profits should be calculated by deducting the transfer marginal profits from the transfer marginal profits of the corporation from the transfer marginal profits from the transfer marginal profits from the transfer marginal profits from the transfer value of assets.

Therefore, the appeal shall be dismissed, and all costs of the lawsuit shall be borne by the losing party. It is so decided as per Disposition by the assent of all participating Justices.

Justices Kim Yong-sung (Presiding Justice)