Seoul Administrative Court-2014-Gu Partnership-50767 ( October 27, 2015)

Whether it constitutes cultural and art events exempt from value-added tax

Although it does not constitute a cultural and art event exempt from value-added tax, it is necessary to cancel input tax deduction, additional tax on unregistered tax, and additional tax on insincere tax invoice as long as registration of legitimate business is made.

Article 12 of the Value-Added Tax Act

2015Nu36210 Revocation of Disposition of Imposing Value-Added Tax

○ Planning Co., Ltd.

Head of △ District Office

on 17 July 2015

on 21, 2015

1. Of the judgment of the first instance, the parts under paragraphs (1) and (2) of this Article shall be changed as follows:

A. The portion exceeding 40,655,030 won of the disposition of imposition of the value-added tax of KRW 64,409,180 for the second year of 2005, which was made on October 2, 2012

B. The Defendant limited on November 9, 2012 to Plaintiff Young-gu Co., Ltd.:

(5) Disposition of imposition of value-added tax amounting to 22,066,870 won in 208

(6) The portion exceeding 65,04,130 won among the disposition of imposition of value-added tax of 2nd year 2008 11,663,360 won.

(8) The portion exceeding 82,428,870 won in the disposition of imposition of the value-added tax of KRW 118,726,430 in 209.

(10) Each disposition of imposing value-added tax of KRW 30,380,620 in 2010 which exceeds KRW 2,376,210 shall be revoked.

2. All remaining appeals by the plaintiffs and the defendant are dismissed.

3. Of the total litigation costs, 50% are borne by the Plaintiffs, and the remainder by the Defendant, respectively.

1. Purport of claim

The Defendant imposed value-added tax of KRW 64,409,180 for 205 on Plaintiff ○○ Planning Co., Ltd. on October 2, 2012, and imposed value-added tax of KRW 27,561,150 for 206 on November 9, 2012, value-added tax of KRW 65,819,280 for 206, value-added tax of KRW 64,188,380 for 207, value-added tax of KRW 21,172,780 for 207, KRW 22,06,870 for 208, value-added tax of KRW 11,63,60 for 203, value-added tax for 209, KRW 360 for 207, KRW 360 for 207, KRW 208, KRW 208 for 207, KRW 2008 for 208.

2. Purport of appeal

A. The plaintiff's purport of appeal

(6) The part against the plaintiffs in the judgment of the court of first instance shall be revoked. The part of the imposition disposition of value-added tax of KRW 64,409,180 on October 2, 2012 against the plaintiff ○○○○ Planning Co., Ltd. of KRW 40,648,370 on the imposition disposition of KRW 27,561,150 on November 9, 2012, the part of the imposition disposition of KRW 14,206,130 on KRW 14,206,130, and KRW 65,819,280 on the imposition disposition of KRW 207, KRW 67,170 on the imposition disposition of KRW 208, KRW 207, KRW 368, KRW 207, KRW 368, KRW 2078, KRW 2086, KRW 2078, KRW 208, KRW 2078, KRW 2078, KRW 20636167,36788, KRW 20787,20787.

B. The defendant's purport of appeal

The part against the defendant in the judgment of the first instance shall be revoked. The plaintiff's claim shall be dismissed.

The same shall apply to the order.

1. Quotation of the reasons for the judgment of the first instance;

This judgment is based on the reasoning of the judgment of the court of first instance, except for dismissal or addition of the following matters, and thus, it is based on Article 8(2) of the Administrative Litigation Act and the main text of Article 420 of the Civil Procedure Act.

(1) On the fourth page, "each value-added tax amount stated in the purport of claims" shall be deemed "each value-added tax amount stated in the purport of claims as shown in attached Table 4".

(2) On the 5th page, the following shall be added:

In addition, Article 12 (1) 15 of the former Value-Added Tax Act does not require "non-profit" to be "non-profit", and Article 36 of the former Enforcement Decree of the Value-Added Tax Act provides that "it shall not aim at profit-making" as a requirement for exemption, which goes beyond the limit of delegated legislation."

(3) On the seventh side, the following shall be added:

(7) The Plaintiff ○○ Planning, as a tax-free business entity, could not receive value-added tax from local governments, etc., on the ground that each of the instant dispositions was unlawful.

(4) On the 8th page, the following shall be added:

"나아가 위임입법의 한계 일탈 여부에 대해 살피건대, 어느 시행령 또는 조례의 규정이 모법의 위임범위를 벗어난 것인지 여부를 판단함에 있어서 중요한 기준 중 하나는 예측가능성인바, 이는 당해 하위법령의 내용이 이미 모법에서 구체적으로 위임되어 있는 사항을 규정한 것으로서 누구라도 모법 자체로부터 그 위임된 내용의 대강을 예측할 수 있는 범위 내에 속한 것이어야 함을 의미하고, 이러한 예측가능성의 유무는 당해 특정조항 하나만을 가지고 판단할 것은 아니고 법률의 입법 취지 등을 고려하여 관련 법조항 전체를 유기적��체계적으로 종합하여 판단하여야 한다(대법원 2008. 11. 27. 선고 2006두19570 판결, 대법원 2006. 2. 24. 선고 2005두2322 판결 참조). 그런데 구 부가가치세법 제12조 제1항 제15호는 "예술창작품, 예술행사, 문화행사와 아마추어 운동경기로서 대통령령으로 정하는 것"이라고 하여 그 용역의 영리 목적 여부에 관하여 기준을 제시한 바 없이 대통령령에서 그 구체적인 내용이 정하여질 것을 예정하고 있으므로, 구 부가가치세법 시행령 제36조에서 구체적인 내용, 즉 영리를 목적으로 하지 아니할 것"을 규정한 것이 위임입법의 한계를 벗어난 것이라고 할 수 없다."

(5) On the 9th page 7, the following are added:

[Defendant asserts that the fact that the plaintiff's business registration was closed following the conversion into a corporation on April 1, 2004 is confirmed by the National Tax Service's computer network after the plaintiff was registered as an individual business operator before its business registration as a corporation, and that the personal business operator discontinued for corporate conversion is the same as the investment in kind by the individual business operator in order to establish the corporation. Thus, the plaintiff who had already been engaged in a taxable business as an individual business, filed a report on whether it constitutes value-added tax " at the time of its conversion into a corporation" as a corporation and filed a report on the "value-added tax" as a disturbance of the plaintiff's duty of care. However, the evidence No. 14 does not mean that the individual business operator's business operator's conversion was merely the ground for its closure, and it cannot be concluded that it did not constitute an "business operator's conversion into a corporation" as the ground for its closure, and that it did not constitute an "value-added tax-free business" as it does not appear that the plaintiff did not have any reason for the plaintiff's filing of this case.

(6) Parts 9, 12 through 20, shall be advanced as follows:

Article 22 (3) 1 of the former Value-Added Tax Act provides that "where an entrepreneur registered as a taxpayer fails to issue a tax invoice under Article 16, an amount equivalent to 2/100 of the value of supply shall be added to the amount of tax payable or deducted from the amount of tax refundable." The main sentence of Article 16 (1) of the same Act provides that "where an entrepreneur registered as a taxpayer supplies goods or services, an invoice stating the following matters shall be issued to the person who receives the supply, as prescribed by Presidential Decree."

(B) In light of the following circumstances, it is reasonable to view that Plaintiff ○○ Planning cannot be deemed as “business operator registered as a taxpayer” under Articles 22(3) and 16(1) of the former Value-Added Tax Act, and thus, it does not have an obligation to issue a tax invoice.

① There is no dispute between the parties that the Plaintiff is not registered as a taxable entrepreneur, and the entrepreneur registered as a taxpayer under Article 16 (1) of the Value-Added Tax Act means the entrepreneur registered as a taxable entrepreneur

② In a case where the Supreme Court Decision 2002Du318 Decided November 27, 2003 rendered a lawful application for registration as a taxable business but became a tax-exempt, the unregistered additional tax under Article 22(1) of the former Value-Added Tax Act cannot be imposed. The legislative intent of the Supreme Court Decision 2002Du318 Decided November 27, 2003 is to facilitate the identification of the taxpayer of value-added tax and the taxpayer of value-added tax and its business contents and taxation data, thereby ensuring the convenience of taxation administration, such as securing base taxation and securing tax revenues. Thus, it is reasonable to view that the above decision is that the taxpayer cannot be held liable even if he did not make a registration as a taxable business even if he did not make a registration as a taxable business, as seen earlier.

③ Article 16(1) of the former Value-Added Tax Act does not stipulate “business operator liable to register as a taxpayer” under Article 22(3)1 of the same Act as “business operator registered as a taxpayer.” In light of the language and text thereof, it cannot be deemed that Plaintiff ○○ Planning is a person liable to issue a tax invoice on the ground that Plaintiff ○○ Planning is a person operating a taxable business.

④ Meanwhile, according to Article 22(8) of the former Value-Added Tax Act, Article 22(1) and (3) of the former Value-Added Tax Act are adjusted under the premise that the same may be applied in principle in duplicate. However, it is difficult to view that a provision under the premise that paragraph(1)1 and paragraph(3)1, which is the premise of non-registration, may be applied in duplicate. For example, Article 22(8) of the former Value-Added Tax Act is a provision under the premise that Article 22(8) of the former Value-Added Tax Act, where a business operator is registered under Article 5 and actually conducts a business under the name of another person prescribed by Presidential Decree, and where a tax invoice under Article 16 is issued without supplying goods or services

(C) If so, it is not possible to impose additional tax on Plaintiff ○○ Planning without a duty to issue a tax invoice pursuant to Article 22(3)1 of the former Value-Added Tax Act. The Plaintiffs’ assertion on this part is with merit.

(7) On the 10th page 18, the following shall be added:

[Plaintiff] The Plaintiff alleged that there was a justifiable reason for the Plaintiffs’ failure to report and pay value-added tax because it was explained that the Defendant issued a tax-free business registration certificate, and that the Plaintiff constitutes a tax-free business. Moreover, even if the tax authority mistakenly knew that the Plaintiff was not subject to value-added tax-free business, it does not constitute a case where there is a justifiable reason when it is evident that the taxpayer’s failure to report and pay taxes is contrary to relevant Acts and subordinate statutes even if the taxpayer believed a tax official’s wrong explanation and did not perform the duty of return and payment (see, e.g., Supreme Court Decisions 2000Nu5944, Dec. 12, 2002; 93Nu15939, Nov. 23, 1993; 96Nu15404, Aug. 22, 197). This part of the Plaintiffs’ assertion also does not have merit.]

(8) On the 17th page, the following shall be added:

“(7) Regarding illegal assertion related to failure to receive value-added tax

As seen earlier, the agent for cultural events conducted by the Plaintiff ○○ Planning is a taxable business, and the Plaintiff ○○ is obligated to pay the value-added tax. Even if the Plaintiff ○○ Planning believed its own business as a tax-free business and did not receive the value-added tax upon entering into a contract with the local government, it does not lose the Plaintiffs’ obligation to pay the value-added tax due to such circumstance. Therefore, this part of the Plaintiffs’

(9) On the 11th page 21, "additional tax on non-registration of business operators" shall be added, and from the 1st to the 2nd 2nd 2010, to "additional tax on non-registration of business operators" under Article 22 (3) of the former Value-Added Tax Act.

(10) Part 2 of Chapter 12 "Additional Tax on Unregistered Matters" shall be added to "Additional Tax on Unregistered Matters and Additional Tax on Insincere Issuance of Tax Invoice".

(11) Part 12, Form 3, and Form 4, Form 12, and Form 3, shall be raised as attached Form 5, respectively.

(12) Attached Forms 4 and 5 shall be added in addition to attached Forms 3.

2. Conclusion

Therefore, the plaintiffs' claims shall be accepted within the scope of the above recognition, and the remaining claims shall be dismissed due to the lack of reasons. Since the judgment of the court of first instance is partially unfair, it is revoked, and both the remaining appeals of the plaintiffs and the defendant are dismissed.