Whether the price of imported liquor, which serves as the tax base for liquor tax, is not determined within the scope of delegation pursuant to the delegation of Article 21(2) and (4) of the former Enforcement Decree of the Liquor Tax Act, which provides for the amount of customs duties added to the dutiable value under the Customs Act (negative)

Article 21(2) and (4) of the former Liquor Tax Act (Amended by Act No. 11134, Dec. 31, 201); Article 20(1)2 (current Deletion) of the former Enforcement Decree of the Liquor Tax Act (Amended by Presidential Decree No. 23598, Feb. 2, 2012)

Hartjin Co., Ltd. (Law Firm LLC, Attorneys O Tae-hwan et al., Counsel for the plaintiff-appellant)

The head of Yangsan Customs Office and two others

Daejeon High Court Decision 2013Nu3175 decided January 16, 2014

All appeals are dismissed. The costs of appeal are assessed against the Plaintiff.

The grounds of appeal are examined.

Article 21(2) of the former Liquor Tax Act (amended by Act No. 11134, Dec. 31, 2011; hereinafter the same) provides that “The tax base for liquor tax on alcoholic beverages other than spirits shall be the price at the time of shipment in cases where alcoholic beverages are shipped out of a manufactory, and in cases of import, it shall be the price at the time of import declaration.” Article 21(4) provides that “the matters necessary for calculating the liquor price under paragraph (2) shall be prescribed by Presidential Decree.” In addition, Article 20(1)2 of the former Enforcement Decree of the Liquor Tax Act (amended by Presidential Decree No. 23598, Feb. 2, 2012) provides that “the price of imported alcoholic beverages shall be the amount calculated by adding the customs duty imposed on the relevant alcoholic beverages to their dutiable value.”

According to the language and structure of the above provision, Article 21(2) of the former Liquor Tax Act provides that the liquor tax shall be imposed on the basis of the price which is not the quantity of alcoholic beverages, but on the basis of the price which is not the quantity of alcoholic beverages, and the tax base shall be calculated on the basis of the time of import declaration. Article 21(2) of the former Liquor Tax Act provides that the tax base shall be determined on the basis of the time of import declaration; and Article 21(4) provides that the price of imported alcoholic beverages shall be calculated at the same time as the time of import declaration; accordingly, the provisions of the Enforcement Decree of the instant case provide that the amount of imported alcoholic beverages shall be calculated by adding customs duties to the dutiable value under the customs laws and regulations. In the event that alcoholic beverages are imported, it is necessary to clearly stipulate that the tax base should be determined at the time of import declaration in accordance with the principle of customs laws and regulations under Article 21(2) of the former Liquor Tax Act, and it is reasonable to interpret the same as the tax base in light of Article 21 of the former Liquor Tax Act.

In the same purport, the court below is just in rejecting the Plaintiff’s assertion that the provisions of the Enforcement Decree of this case, which provide that customs duties shall be added to the imported liquor under Article 21(2) of the former Liquor Tax Act, should be deemed as the declared price under the relevant tariff-related Acts and subordinate statutes, are invalid because they do not have any delegation of the parent law or exceed the scope of delegation. In so doing, the court below did not err by

Therefore, all appeals are dismissed, and the 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 Kim Yong-deok (Presiding Justice)