[1] The meaning of "land on which a building under the Building Act is settled" that is excluded from the national housing construction site where capital gains tax is reduced under the former Regulation of Tax Reduction and Exemption Act

[2] The method of calculating the reduced or exempted capital gains tax where the entire transferred land is transferred to a registered housing constructor as a site for a part of a national housing complex among the main complex buildings

[1] According to Article 62(1) of the former Regulation of Tax Reduction and Exemption Act (amended by Act No. 4666 of Dec. 31, 1993) and Article 50(1)1 of the Enforcement Decree of the same Act (amended by Presidential Decree No. 14084 of Dec. 31, 1993), “land on which a building under the Building Act is settled pursuant to the same Act” shall be excluded from the land subject to reduction and exemption of capital gains tax. However, this is excluded from the land subject to reduction and exemption where the land on which a building is built from the beginning is transferred to a national housing construction site, and even if a building including a national housing which is built on the land at the time of transfer is completed, it does not constitute “land on which a building is settled under the Building Act” and does not constitute “land subject to reduction and exemption.”

[2] Article 62(1) of the former Regulation of Tax Reduction and Exemption Act (amended by Act No. 4666 of Dec. 31, 1993) provides that where a national transfers a parcel of land to a registered housing constructor as a site for constructing a national housing, a tax amount equivalent to 50/100 of capital gains tax shall be reduced. Thus, if a co-owned share transferred to a registered housing constructor is transferred as a site for a national housing among the main complex buildings, if the whole co-owned share transferred to a registered housing constructor is a site for a national housing among the main complex buildings, the amount of capital gains tax

[1] Article 62 (1) of the former Regulation of Tax Reduction and Exemption Act (amended by Act No. 4666 of Dec. 31, 1993) (see current Article 80 (1) of the Restriction of Special Taxation Act), Article 50 (1) 1 of the former Enforcement Decree of the Regulation of Tax Reduction and Exemption Act (amended by Presidential Decree No. 14084 of Dec. 31, 1993) (see current Article 75 (1) 1 of the Restriction of Special Taxation Act) / [2] Article 62 (1) of the former Regulation of Tax Reduction and Exemption Act (amended by Act No. 4666 of Dec. 31, 1993) (see current Article 80 (1) of the Restriction of Special Taxation Act), Article 50 (1) 1 of the former Enforcement Decree of the Restriction of Special Taxation Act (amended by Presidential Decree No. 14084 of Dec. 31, 1993), Article 17 (1) 97 (1) 7(1) of the current Regulation of Special Taxation Act)

[1] Supreme Court Decision 95Nu3527 delivered on September 15, 1995 (Gong1995Ha, 3445)

[Judgment of the court below]

Head of Nam Busan District Tax Office

Busan High Court Decision 96Gu12238 delivered on November 19, 1997

The part of the judgment below against the plaintiff is reversed, and that part of the case is remanded to Busan High Court. The defendant's appeal is dismissed.

We examine the grounds of appeal.

1. As to the Defendant’s ground of appeal

According to Article 62(1) of the former Regulation of Tax Reduction and Exemption Act (amended by Act No. 4666 of Dec. 31, 1993, hereinafter referred to as the "Act") and Article 50(1)1 of the Enforcement Decree of the same Act (amended by Presidential Decree No. 14084 of Dec. 31, 1993, hereinafter referred to as the "Act"), "land on which a building under the Building Act is settled pursuant to the "Act" shall be excluded from the land on which capital gains tax is reduced or exempted. However, in cases where the land on which a building is built from the beginning is transferred to a national housing construction site, it shall be excluded from the land subject to reduction or exemption, and as in the case of this case, even if the main complex building including the national housing that is constructed on the land at the time of transferring the shares of this case, it constitutes "land on which a building under the Building Act is settled", it does not constitute "land subject to reduction or exemption (see Supreme Court Decision 95Nu27537, Sept. 15, 1995). 19

Although the reasoning of the judgment of the court below is not appropriate, the conclusion that the transfer of share in the land of this case constitutes grounds for reduction of capital gains tax under Article 62 (1) of the Act is just, and the ground of appeal on the premise that the transfer of share in this case constitutes "building" under the above Acts and subordinate statutes is without merit.

2. Plaintiff’s ground of appeal

According to the reasoning of the judgment below, the court below deemed that the plaintiff transferred 399.2 square meters (74,930 square meters) out of 749.3 square meters of the instant land to the non-party Samsung Construction Co., Ltd., and calculated the reduced or exempted tax amount for the transfer of the shares, calculated the reduced or exempted tax amount in the formula of the "transfer land area 】 total area of national housing / national housing and the total area of buildings other than the national housing / the national housing / calculated tax amount 】 the reduced or exempted tax amount in the formula of the "total area of buildings other

However, according to the records, the Plaintiff’s share of 399.2m2m2, which was transferred to Nonparty Samdong Construction Co., Ltd., can be known that all of which was transferred as a site ownership of national housing among the main complex buildings of this case. Article 62(1) of the Act provides that where a national transfers a parcel of land to a registered housing constructor as a national housing construction site, a tax amount equivalent to 50/100 of capital gains tax shall be reduced or exempted. In this case, the tax amount equivalent to 50/100 of capital gains tax shall be calculated after calculating the amount of capital gains tax on the entire co-ownership of 399m2m2

Nevertheless, the court below calculated the area of the construction site of the national housing in the formula of "the total area of the national housing 】 the total area of the national housing / the total area of the buildings other than the national housing / the total area of the buildings, by considering the area of the construction site of the national housing of this case and the area of the transferred land differently. Thus, there is an error of law in

3. Therefore, the part of the judgment of the court below against the plaintiff is reversed and remanded to the court below, and the defendant's appeal is dismissed. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Lee Yong-dam (Presiding Justice)