Japan 46014-3354 ( December 22, 1994)

Transfer

With respect to income accruing from the transfer of land, etc. necessary for a public project to the relevant public project operator on or before December 31, 1992, the transfer income tax shall be exempted in full, or 300 million won by taxable period.

1. With respect to income accruing from the transfer of land, etc. necessary for public projects to which the Act on Special Cases concerning the Acquisition of Land for Public Use and Compensation for Loss applies to the relevant public project operator on or before December 31, 192, the transfer income tax is wholly exempted under Article 19(2) of the Addenda of the former Tax Reduction and Exemption Control Act (Act No. 4451, Dec. 27, 1991); or 2. Where the total amount of reduced and exempted tax exceeds 300 million won by taxable period, the amount equivalent to the excessive portion under Article 88-2 of the same Act shall not be reduced or exempted.

Article 88-2 of the Regulation of Tax Reduction and Exemption Act (Total Limit of Reduction and Exemption of Transfer Income Tax)

1. A summary of the contents of inquiry;

On November 18, 1992, 1992, ○○○-dong ○○○○-dong ○○○○-dong ○○○○-dong ○○○-dong ○○○○-dong ○○○○-dong ○○○-dong ○○○○-dong ○○○○-dong ○○○○-dong ○○○-dong ○○ ○○-dong ○○ ○○ ○-dong ○ ○ ○○ ○○ ○-dong ○ ○ ○○ ○ ○ ○ ○ ○-dong ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○)

After that, the head of ○○○○ is currently using as a juvenile room (see a certified copy of a separate building management ledger) by constructing a 102m2 square meter per floor of the 1st floor of the mentmen’s menter’s brick building on this site.

In this case, I ask questions as to whether the capital gains tax is fully reduced (300 million won less) under Article 57 of the Regulation of Tax Reduction and Exemption Act and Article 19 (2) of the Addenda of the same Act (Act No. 4451, Dec. 27, 1991).

(A)

- This case does not constitute a public project to which the Special Act on the Acquisition of Land for Public Use and the Compensation for Loss applies, and thus, capital gains tax shall not be reduced or exempted.

(B) The theory

- This case is a transfer of land for public projects to which the Act on Special Cases Concerning the Acquisition of Land for Public Use and Compensation for Loss applies, since the head of ○○○○○○-dong Youth Day Project transferred the land for night-time public use facilities by mutual agreement. Therefore, capital gains tax is levied

(G)Indemy:

- Transfer income tax shall be reduced in full because it is generated by transferring land necessary for public projects subject to the Act on Special Cases concerning the Acquisition of Land for Public Use and Compensation for Loss to public project implementers.

This is because public project refers to a project that can expropriate or use land, etc. under Article 3 of the Land Expropriation Act, so the juvenile night study room installed by the head of ○○○ refers to a project on cultural facilities or other public facilities as stipulated in Article 3 subparagraph 3 of the Land Expropriation Act, and the purpose of the Act on Special Cases concerning the Acquisition of Land and other Public Facilities and Compensation for Loss is to set the standards and methods for the acquisition or use of land, etc. necessary for public project and the compensation for loss, so it is contradictory interpretation that it does not constitute a transfer by mutual agreement.

2. Relevant tax-related Acts and subordinate statutes (Acts, Enforcement Decree, Enforcement Rule, and General Provisions);

(Gu) Article 19(2) of the Addenda to the Regulation of Tax Reduction and Exemption Act

Article 88-2 of the Regulation of Tax Reduction and Exemption Act.