Whether the standard market price can be applied in cases of designation as a designated area between the date of a sales contract and the date of the remainder payment

It is difficult to view that the provisions of the Income Tax Act, etc. are against the principle of trust protection and the principle of prohibition of retroactive taxation, because they were designated as a designated area at any time according to the changes in the economic situation under the relevant provisions, and they were found to have known of such facts.

Article 96 (Transfer Price)

Article 104-2 (Operation of Designated Area)

1. The plaintiff's claim is dismissed.

2. The costs of lawsuit shall be borne by the Plaintiff.

The defendant's disposition of refusal to correct or reject capital gains tax against the plaintiff on July 7, 2006 shall be revoked.

1. Details of the disposition;

A. On December 22, 197, the Plaintiff acquired and held 190.4 square meters of the Jongno-gu Seoul Metropolitan Government ○○○○○○○○ site and its ground timber and 52.89 square meters of the neighborhood living facilities (hereinafter “the instant real estate”) for sale and purchase, on December 21, 2005, sold the instant real estate to Nonparty ○○○ in KRW 160 million on December 21, 2005, and 160,000,000 out of the down payment was the contract date, and the intermediate payment of KRW 640,00,000 on January 20, 2006, the remainder amount of KRW 800,000,000,000 was received on January 27, 2006, and at the same time, the Plaintiff agreed to receive the remainder and deliver necessary documents and deliver the instant real estate at the same time.

B. The Plaintiff received all intermediate payments and remainder by January 26, 2006, and completed the registration of ownership transfer with respect to the instant real estate to female ○ on January 26, 2006.

C. The Jongno-gu Seoul, where the instant real estate is located, was designated as an area where the transfer value should be reported as the actual transaction price on the housing around September 15, 2005. On or around January 17, 2006, according to the deliberation by the Deliberation Committee on Real Estate Price Stabilization in the 36th Real Estate Price Stabilization of the Republic of Korea, the land price increase due to the development counter-examination as of January 20, 2006 on the ground that the land price is likely to increase due to the development counter-examination according to the designation of Youngnam (Seoul Dong Dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-dong-si-dong-dong-dong-dong-

D. On March 28, 2006, the Plaintiff reported and paid to the Defendant the transfer income tax of KRW 262,562,200 based on the actual transaction price of the instant real estate, and on May 28, 2006, the Plaintiff submitted a written request for correction (payment) demanding the Defendant to levy transfer income tax by calculating the transfer margin according to the standard market price not based on the actual transaction price. On July 7, 2006, the Defendant rendered the instant disposition rejecting the Plaintiff’s claim for correction on the ground that it is reasonable to report and pay the transfer income tax based on the actual transaction price on the grounds that the instant real estate is located in an area designated by the Minister of Finance and Economy as of

[Reasons for Recognition] Each entry in Gap-I, 2, 4, 5, 6, 9, 10, 11 (including paper numbers), and the purport of the whole pleadings

2. Whether the disposition is lawful;

A. The plaintiff's assertion

(1) On December 21, 2005, at the time of the conclusion of the purchase and sale contract for the instant real estate, the transfer income tax was imposed on the standard market price, but the location of the instant real estate was designated as an area where the transfer value should be reported as the actual transaction price without prior notice, and accordingly, the transfer income tax was imposed by calculating the transfer value according to the actual transaction price. Accordingly, this is contrary to the principle of trust protection, as it undermines the Plaintiff’s trust interest that is believed to have been paid by calculating the transfer value according to the standard market

(2) This taxation is levied on the effects of non-appealed salt. (1) The real estate of this case is only designated as the designated area as the situation where the land price rate is set as a unit of Si/Gun/Gu even though the land price rate is not likely to increase due to development factors, such as new transport development in part of Jongno-gu Seoul Metropolitan area, due to the situation where the land price rate is set as a unit of Si/Gun/Gu. (2) The officially assessed individual land price of the real estate of this case did not change between January 1, 2005 and January 20, 2006. (3) The designation of the designated area was made before the remainder payment date and six (6) days, and ④ The land price rate at the Jongno-gu Seoul was lower than the land price rate at which the plaintiff could not be seen in advance, and thus, it is ultimately contrary to the principle of prohibition of retroactive taxation.

(3) Therefore, the instant disposition should be revoked as it is unlawful.

(b) Related statutes;

Article 96 (Transfer Price)

Article 104-2 (Operation of Designated Area)

Article 168-3 (Standards, etc. for Designation of Designated Area)

Article 168-4 (Composition and Operation of Deliberation Committee on Real Estate Price Stabilization)

Article 168-5 (Procedures, etc. for Designation of Designated Area)

C. Determination

(1) As to the assertion of violation of the principle of trust protection

In general, in administrative legal relations, the principle of the protection of trust is applied to the acts of an administrative agency: first, the administrative agency should name the public opinion that is the object of trust to an individual; second, the administrative agency should have a reason attributable to the individual when the statement of opinion is well-grounded; third, the individual should have trusted the statement of opinion; third, the administrative agency should have conducted any act in violation of the above statement of opinion; fourth, the administrative agency should have made a disposition contrary to the above statement of opinion so that the interests of the individual who trusted the statement of opinion may be infringed; fourth, if any administrative disposition satisfies these requirements, it is against the principle of the protection of trust unless it is likely to seriously undermine the public interest or legitimate interests of a third party (see, e.g., Supreme Court Decisions 9Du19070, Mar. 9, 199; 2004Du466, Jun. 9, 2006).

① The Defendant et al. cannot be deemed to have expressed a public opinion that it would impose capital gains tax on the Plaintiff by calculating the transfer value of the instant real estate as the standard market price; ② at any time according to changes in economic situation under the relevant provisions of the Income Tax Act, etc., the area of the instant real estate could be designated as a designated area; and the Plaintiff did not appear to have been aware of such circumstances; ③ In particular, the Jongno-gu Seoul, where the instant real estate was located, was designated as an area where the transfer value should be reported as the actual transaction price of the housing around September 15, 2005; and the price of Pyeongtaek-dong, Changdong, and Changdong, located in Jongno-gu Seoul, Seoul, was designated as a new town; and the Plaintiff could have sufficiently predicted that the instant disposition was likely to be designated as an area where the transfer value should be reported as the actual transaction price with respect to real estate other than the housing. Accordingly, the Plaintiff’s allegation in this part of this case cannot be deemed to violate the principle of trust

(2) As to the assertion of violation of the principle of retroactive taxation prohibition

According to the provisions of Articles 96(2)7 and 104-2 of the former Income Tax Act, and Article 168-3 of the Enforcement Decree of the Income Tax Act, where the inflation rate in the location of real estate is higher than the national inflation rate or the national consumer price inflation rate, etc., the location of real estate is designated as an area and the transfer price is determined based on the actual transaction price even if the real estate is transferred before December 31, 2006. The purport of the above provision is to prevent side effects that may undermine the equity of taxation as the standard market price cannot be imposed on the enormous transfer margin because the market price is so rapid in the short-term due to speculative transactions or illegal transactions because it is impossible to properly reflect the market price of the real estate. Meanwhile, in light of the above circumstances, the Plaintiff’s trust interest related to the designated area is no or significant. On the other hand, the public interest of preventing illegal transactions and taxation equity, which the Plaintiff’s trust interest to achieve through the above provision, is considerably larger than the Plaintiff’s trust interest.

3. Conclusion

Therefore, the plaintiff's claim of this case is dismissed for reasons.