The tax base shall be the total amount of the market value of goods or services supplied by the supplier in return for payments other than money.

The tax base of value-added tax on the supply of goods or services shall be the aggregate of the market prices of the goods or services supplied by the supplier himself/herself, in cases of payment other than money, and in such cases the market prices shall be the prices of continuous transactions in similar circumstances with a person other than the person with a special relationship

Article 13 (1) 2 of the Value-Added Tax Act

Article 50 (1) 1 of the Enforcement Decree of the Tax Act

1. The Defendant’s imposition disposition of value-added tax on June 5, 2007 exceeding KRW 69,310 in excess of KRW 849,640 in excess of KRW 69,640 in the first term portion of year 2003, the second term portion of year 2003 in excess of KRW 2,456,050 in the imposition disposition of KRW 2,360 in the first term portion of year 2004, the amount exceeding KRW 1,925,020 in the imposition disposition of KRW 2,262,060 in the second term portion of year 2004, the amount exceeding KRW 1,842,120 in the imposition disposition of KRW 1,768,130 in the imposition disposition of KRW 2,170,670 in the first term portion of year 205, the amount exceeding KRW 1,368,130 in the imposition disposition of KRW 2,130 in the second term portion of year 2005.

2. The plaintiff's remaining claims are dismissed.

3. Of the litigation costs, 80% is borne by the Plaintiff, and the remainder is borne by the Defendant, respectively.

The Defendant’s imposition of value-added tax against the Plaintiff on June 5, 2007, KRW 849,310 for the first term of 2003, KRW 2,363,46,00 for the second term of 203, KRW 2,363,460 for the second term of 204, KRW 2,262,060 for the second term of 204, and KRW 2,170 for the first term of 205, KRW 670 for the second term of 205, and KRW 1,732,90 for the second term of 205.

1. Details of the disposition;

The following facts are not disputed between the parties, or may be recognized by Gap evidence 1, 2, 7 (including each number), and Eul evidence 1 to 6:

A. The Plaintiff is an individual entrepreneur who runs an electronic industrial component product in the trade name of ○○○○○○○○○-si 176-208, called “○○ Electronic Industry Company” in a factory building located in ○○○○○○○-si.

B. On June 5, 2007, on the ground that the Plaintiff leased part of the above factory building (hereinafter referred to as "the building of this case") to ○○○○○ engaged in the manufacturing business under the name of "○○○○○○○○○," and did not report the value-added tax for the pertinent period, the Defendant rendered a disposition of KRW 25,00,000,000, monthly rent of KRW 2700,000,000, on the ground of the lease agreement attached to the report on the correction of ○○○○○’s business registration for the pertinent period of time on the ground that the Plaintiff did not report the value-added tax for the pertinent period of time. The Plaintiff rendered a disposition of KRW 849,310, KRW 2,456,00 for the second period of 2,363,460 for the first period of 204, KRW 2,262,060 for the second period of 204, KRW 12,7079,205.

C. The Plaintiff dissatisfied with the instant disposition and filed a request for examination with the Commissioner of the National Tax Service on July 16, 2007, but was dismissed on October 15, 2007.

2. Determination of legality of disposition

A. The plaintiff's assertion

Around March 31, 2003, the Plaintiff and ○○○ entered into a lease agreement with the Plaintiff to rent KRW 25,000,000, monthly rent of KRW 2700,000 on the instant building to ○○○○○○○. Following the agreement, both parties amended the said lease agreement by deeming ○○○○ to develop an item without compensation or provide samples to the Plaintiff, instead of exempting the Plaintiff from monthly rent. As such, the instant disposition was unlawful on the ground that the Plaintiff was paid monthly rent from ○○○ on the ground that the change in the lease agreement was changed, and the Plaintiff did not receive monthly rent from ○○○○.

(b) Related statutes;

It is as shown in the attached Table related statutes.

(c) Fact of recognition;

The following facts may be acknowledged by taking into account the following facts between the parties as a business operator in dispute, Gap evidence 3-1, 2, 5, 8, Eul evidence 2-1 through 3, Eul evidence 3, and Eul's testimony of ○○○○○ witness.

(1) On March 31, 2003, the Plaintiff and ○○○○ entered into a lease agreement stating that the Plaintiff would lease the instant building to ○○○○○ KRW 25,000,000, monthly rent of KRW 2,700.

(2) On April 11, 2003, ○○○ reported business registration correction and submitted it along with the above lease contract.

(3) On April 2003, 2003, around the time when ○○○○ moved in the building of this case, the Plaintiff and ○○○○○ amended the terms of the lease agreement by developing the items or making sampling samples free of charge to the Plaintiff instead of exempting the Plaintiff from monthly rent. Accordingly, ○○○ did not pay monthly rent to the Plaintiff.

(4) The actual manager of ○○○○○○○, who is the husband of ○○○○○○○, was developing and providing an item (electronic component type) with about 5,6 items during the term of lease in accordance with the terms and conditions of the changed lease agreement, but failed to meet some requirements and conditions, and the project was supported and promoted due to the development cost of an item, etc. The ○○○ was in conflict with the Plaintiff during the said process and left the building of this case around the end of November 2005.

(5) After that, the Plaintiff leased the instant building to ○○○○, Inc. by setting the lease deposit amount of KRW 20,000,000, monthly rent of KRW 2,200,000, and the lease term of KRW 2,200,00 from September 18, 2006 to September 18, 2007.

D. Determination

(1) There is no evidence to acknowledge that the Plaintiff received monthly rent of KRW 2,700,000 from ○○ in 2003 through 2005 (the same shall apply as seen earlier). The instant disposition that the Plaintiff imposed value-added tax on the premise that the Plaintiff received rent of KRW 25,000,000 from ○○○○○○ and KRW 2,70,000 per month on the premise that the Plaintiff was paid rent of KRW 25,00,000 and KRW 2,70,000 per month.

(2) Meanwhile, Article 13(1)2 of the Value-Added Tax Act provides that the tax base of value-added tax on the supply of goods or services shall be the total market value of the goods or services supplied by a person who receives any consideration other than money. Article 50(1)1 of the former Enforcement Decree of the Value-Added Tax Act (amended by Presidential Decree No. 1930, Feb. 9, 2006) provides that the market value under each subparagraph of Article 13(1)1 of the former Enforcement Decree of the Value-Added Tax Act (amended by Presidential Decree No. 1930, Feb

As to this case, the Plaintiff agreed to be provided with items or samples developed by ○○○○○○ in lieu of exempting monthly rent from ○○○○○. Since ○○○ removed from the building of this case, the Plaintiff decided to lease the building of this case at KRW 20,000, monthly rent of KRW 2200,000,000 to ○○○○○, a corporation after leaving the building of this case, as seen earlier. As such, it is reasonable to deem that monthly rent of KRW 2,200,000, which appears to have been received from ○○○○, falls under the market price of the lease service of the building of this case, since the Plaintiff continuously traded the building in a situation similar to that of the person other than the person having a special relationship, the sum of the Plaintiff’s rent of KRW 2,20,00,000, which is the tax base of value-added tax corresponding to the market price of the lease service of the building of this case during the lease period.

(3) Calculation of a reasonable amount of tax

Based on the above judgment, the reasonable tax amount to be imposed on the Plaintiff is calculated as follows.

Taxation Period

Value-Added Tax Base (won)

Value-added Tax (cost)

10 10

J. J. J. M.T.

The Disposition of this case

Justifiable Tax Amount

1, 2003

505,705,172

504,716,104

849,310

698,640

203

416,118,702

413,012,839

2,456,020

2,000,050

1, 2004

432,669,583

429,567,747

2,363,460

1,925,020;

204 Second Period

388,005,267

384,913,535

2,262,060

1,842,120

1, 2005

285,811,918

282,725,655

2,170,670

1,768,130

Second Period, 2005

276,194,811

273,619,359

1,732,90

1,411,360

11,834,510

9,645,320

Therefore, the part of the disposition of this case, which exceeds the above legitimate tax amount, should be revoked as illegal.

3. Conclusion

Therefore, the plaintiff's claim of this case is dismissed as it is without merit, and it is so decided as per Disposition.