When calculating the tax base of the land excess profit tax for one parcel of co-owned land, the method of applying the basic deduction and the tax rate;

In calculating the amount of land excess profit tax on co-owned land, the tax base for the land equivalent to each co-owner's share shall be calculated, not by applying the tax rate according to the tax base, but by applying the tax rate pursuant to Article 11-2 of the same Act to the tax base calculated by applying the basic deduction under Article 11-2 of the same Act, from the land excess profit for one parcel's land, and the tax amount shall be calculated by applying the

Articles 4, 11(1), and 11-2 of the Land Excess Profits Tax Act; Article 40(5) of the Enforcement Decree of the Land Excess Profits Tax Act

[Plaintiff-Appellant] Plaintiff 1 and 1 other (Law Firm Doz., Attorneys Park Jong-soo et al., Counsel for plaintiff-appellant)

Plaintiff 1 and one other (Attorney Jeon Byung-chul, Counsel for the plaintiff-appellant)

Deputy Director of the Tax Office

Seoul High Court Decision 94Gu27597 delivered on April 19, 1996

The part of the judgment of the court below ordering revocation of the part of the disposition of this case against the plaintiffs exceeding KRW 1,813,950 in excess of KRW 2,523,260 is reversed, and the plaintiffs' claim as to that part is dismissed, respectively. The remaining appeals by the defendant are dismissed. The 3/5 of the total costs of the lawsuit are assessed against the plaintiffs and the remainder are assessed against the defendant.

We examine the grounds of appeal.

1. According to the reasoning of the lower judgment and the record, the lower court determined that the amount of the reasonable land excess profit tax calculated by applying 30/100 of the tax base under Article 12 of the Land Excess Profit Tax Act for each of the following amounts: (a) the amount of the reasonable land excess profit tax calculated from June 2, 1990 to December 31, 192 on the plaintiffs (1/2 of the co-owners of the land in this case), who are the co-owners of the land in Seocheon-si ( Address omitted); (b) KRW 8,046,532 of the land in this case, each of the basic deductions of KRW 2,00,000,000 for the land corresponding to the portion of the Plaintiff’s share as to the land in this case; and (c) KRW 6,046,532 of the land excess profit tax, each of which is calculated by applying the tax rate of KRW 10,000,000 under Article 12 of the same Act to the Plaintiffs.

However, Article 11(1) of the Land Excess Gains Tax Act provides that "the tax base of the land excess profit tax shall be calculated by parcel, and except as otherwise provided for in this Act, the amount prescribed in the subparagraphs of the same paragraph shall be the amount which deducts the standard market value of the land on the date of commencing the taxable period from the standard market value of the land on the date of commencing the taxable period, and shall be the amount which makes the basic deduction under the provisions of Article 11-2 from the land excess profit." Article 11-2(1) of the same Act provides that "in calculating the tax base of the land excess profit tax under the provisions of Article 11, 20,000 won shall be deducted from the land excess profit in the taxable period concerned." Article 4(1) of the same Act provides that "The tax base of the land excess profit tax shall be calculated by applying the provisions of Article 97 of the same Act to the tax base of the same Act, and the tax base of the land excess profit shall be calculated by applying the provisions of the same Act to the owner of the same land."

Therefore, the legitimate land excess profit tax amount on the land of this case against the plaintiffs is calculated as 16,093,064 won (8,046,532 won) x 2,000 won which is calculated as follows: 14,093,064 won which is calculated as the basic deduction of 2,000 won under Article 11-2 of the same Act; 5,046,532 won [3,000 won + 14,000 won + 10,064 won x 50,000 won which is calculated as 16,064 won x 50,000 won which is calculated as the tax base of this case's land excess profit x 2,523,260 won (5,000 won) which is calculated as the basic deduction of 2,000 won under Article 11-2 of the same Act x 2 x 14,000 won which is calculated as the above tax base of this case's.

2. Therefore, the part of the judgment of the court below ordering the cancellation of the part of the disposition of this case against the plaintiffs in excess of 1,813,950 won in each of the disposition of this case against each of the plaintiffs and 2,523,260 won in each of them shall be reversed. However, this part is sufficient to see from the party members on the basis of the facts established by the court below, and therefore, it shall be self-market in accordance with Article 8(2)

For the above reasons, only the portion exceeding KRW 2,523,260 among the dispositions of this case against the plaintiffs in this case is illegal. As such, the plaintiffs' claims against the plaintiffs in this disposition of this case against KRW 1,813,950 in excess of KRW 2,523,260 in each of the dispositions of this case are dismissed as it is without merit.

3. For the above reasons, the Defendant’s appeal is with merit within the above scope of recognition. The Defendant’s remaining appeal is dismissed as it is without merit. It is so decided as per Disposition by the assent of all participating Justices on the bench, applying Article 8(2) of the Administrative Litigation Act, Articles 96, 89, 92, and 93(1) of the Civil Procedure Act to the burden of litigation costs.

Justices Kim Jong-sik (Presiding Justice)