Seocho 2013west 4674 (Law No. 123, 2014)

The regulations on appraisal of listed stocks and the certificate of largest shareholder shall not be deemed to be unconstitutional or unlawful invalid.

The regulation on appraisal of listed stocks and the provision on the premium for the largest shareholder shall not be deemed unconstitutional or unlawful invalid, but the tax base of the securities transaction tax shall be calculated on the basis of the closing price on the day when the share is transferred.

Article 101 of the former Income Tax Act / [Calculation of Transfer Income by Wrongful Acts]

2014Guhap67758 Such revocation as transfer income tax, etc.

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○ Head of tax office

April 24, 2015

May 8, 2015

1. The Defendant’s disposition rejecting securities transaction tax claim against the Plaintiff on August 23, 2013 is revoked.

2. The plaintiff's remaining claims are dismissed.

3. One-half of the costs of lawsuit shall be borne by the Plaintiff, and the remainder by the Defendant, respectively.

Cheong-gu Office

Paragraph (1) and the defendant's rejection disposition against the plaintiff on September 10, 2013 shall be revoked.

1. Details of the disposition;

A. On January 201, 201, the Plaintiff sold the listed stocks ○○○○ (hereinafter “instant shares”) of ○○○○ Company, ○○○, Inc. (hereinafter “Mediation”) as a type of the sales price to ○○○○ (hereinafter “instant sales price”) with the total sum of KRW 00 per share, a closing day, ○○ (hereinafter “instant sales price”) as a part-time sales method (hereinafter “instant transfer”).

B. The Plaintiff filed a return on capital gains tax with the above amount as the transfer value on October 2012. However, the director of the regional tax office of ○○○○○○ filed a return on capital gains tax and securities transaction tax on the transfer of this case. The tax base of the capital gains tax and securities transaction tax on the transfer of this case was calculated and paid as the capital gains tax and securities transaction tax on June 12, 2013 by regarding the amount calculated by adding 30% of the average of the final market values of the Korea Exchange published during two months before and after the date of the transfer of the instant stocks to ○○○○○○○○ (hereinafter “market value”) and calculated as the revised return on capital gains tax and securities transaction tax (the Plaintiff calculated as the revised return on capital gains tax and securities transaction tax on December 31, 201, considering that the market value of the instant stocks was not the average market value of ○○○○, but the average market value as the capital gains tax and the revised return on June 12, 2013).

C. After that, the Plaintiff filed an application for correction with the Defendant on the ground that the instant purchase price constitutes a tax base, and filed an application for correction of the securities transaction tax on ○○○○ on 2013, and the transfer income tax on ○○○ on 2013.

D. As to a claim for correction of the securities transaction tax on August 23, 2013 on the grounds that the tax base of the securities transaction tax of this case is the market price under Article 7(1) of the Securities Transaction Tax Act and Article 63 of the former Inheritance Tax and Gift Tax Act, the Defendant issued each rejection disposition on September 10, 2013 on the grounds that the tax base of the capital gains tax of this case should be based on the market price under the Inheritance Tax and Gift Tax Act (hereinafter “the rejection disposition on the claim for correction of the securities transaction tax of this case”), and “the rejection disposition on the claim for correction of the capital gains tax of this case” is “the rejection disposition on the capital gains tax of this case,” and “the respective rejection disposition of this case,” respectively.

E. On October 2013, 2013, the Plaintiff filed a request for a trial with the Tax Tribunal, but was dismissed on October 2013.

[Ground of recognition] Facts without dispute, entry of Gap evidence 1 through 9 (including branch numbers for those with additional numbers; hereinafter the same shall apply) and the purport of whole pleadings

2. Related statutes;

It is as shown in the attached Table related statutes.

3. Whether each of the refusal dispositions of this case is legitimate

(a) Facts of recognition;

1) As of October 201, 201, the number of shares issued by ChoA is ○○ as of ○○○. The largest shareholder is 17.45% of the shares owned by ○○○. The number of shares owned by the largest shareholder, etc. with a relationship with thisCC, as ○○ shareholder, constitutes 60.17% of the total shares.

2) At the time, the Plaintiff owned ○○○, and B owned ○○○○.

3) The Plaintiff’s shares of this case among the above ○○ shares via the instant transfer on ○○, 2011.

The sale was made to BB.

[Ground of recognition] Facts without dispute, Eul evidence Nos. 1-1 and 2, the purport of the whole pleadings

B. As to the rejection disposition of the transfer income tax of this case

1) The plaintiff's assertion

Article 167(3)1 and (5) of the former Enforcement Decree of the Income Tax Act violates the principle of actual transaction price as to calculation of the tax base of capital gains tax declared by the former Income Tax Act, and also imposes tax on the transaction parties who freely determine the transfer value and impose tax on the portion for which no substantial profit is gained for the purpose of tax saving, thereby violating the principle of substantial taxation as stipulated by the Framework Act on National Taxes. Ultimately

In addition, Article 63(1)1(a) and (3) of the former Inheritance Tax and Gift Tax Act, which is applicable mutatis mutandis under the same Enforcement Decree, provides that the value of the shares held by the largest shareholder, etc. shall be added by 20/100 to 30/100 when calculating the value. However, the transferor, as the largest shareholder, etc., is not an opportunity to realize or realize the management premium, etc., and thus, he/she should pay the shares to the largest shareholder, etc., and thus, he/she excessively infringes on the taxpayer’s property right in violation of the principle of substantial taxation. due to each of the above provisions, the transferor is treated as the same as the heir and donee’s interest in the case where the transferor is in essence different, compared with the fact that the transferee is not liable to pay any tax. In the event of a sale of shares in excess of hours on the day under Article 44 of the former Inheritance Tax and Gift Tax Act, the transferee is in violation of the principle of tax equality by treating only a transfer by low price transfer.

2) Determination

A) Article 167 of the former Enforcement Decree of the Income Tax Act on the delegation of Article 101(5) of the former Enforcement Decree of the Income Tax Act provides that "if it is recognized that the tax burden has been unjustly reduced with respect to wrongful calculation of transfer income, the tax burden shall be reduced at a price higher than the market price or the assets are transferred to the related party at a price lower than the market price." In applying Article 101(3) of the former Enforcement Decree of the Income Tax Act, the market price shall be determined by applying mutatis mutandis the provisions of Articles 60 through 64 of the Inheritance Tax and Gift Tax Act, Articles 49 through 59 of the Enforcement Decree of the same Act, and Article 101 of the Restriction of Special Taxation Act. In addition, Article 60(1) of the former Inheritance Tax and Gift Tax Act provides that "the value of the property on which the inheritance tax or gift tax is levied pursuant to this Act shall be the market price as of the date of commencing the inheritance (hereinafter referred to as "date of appraisal"). In this case, Article 63(1)1)1(b) shall be deemed as the market price.

The term "stocks and equity shares of a stock-listed corporation traded on the securities market under Article 9 (13) 1 of the Financial Investment Services and Capital Markets Act shall be the average amount of the last market value (not based on whether there is a transaction record) of the Korea Exchange every two months before and after the evaluation base date, and Article 63 (3) of the same Act shall apply to the stocks, etc. (excluding stocks, etc. of a corporation with losses under Article 14 (2) of the Corporate Tax Act continuously from three years before the business year in which the evaluation base date falls) of the largest shareholder or largest investor, and stockholders or investors specially related to the largest shareholder, etc. (hereafter in this paragraph, referred to as "major shareholder, etc.") of the corporation in excess of 20/100 (10/100 in cases of small and medium enterprises prescribed by Presidential Decree) of the value appraised in accordance with paragraphs (1) 1 and (2) or the value recognized in accordance with Article 60 (2) of the same Act, and shall be added to 30/100 of the total outstanding shares of the corporation concerned.

B) In light of the facts acknowledged earlier, the Plaintiff also acknowledges that the transfer income tax base of the transfer of this case is determined by the calculation method asserted by the Defendant. However, the Plaintiff asserts that the above provision of the former Enforcement Decree of the Income Tax Act (hereinafter referred to as the “Enforcement Decree of this case”) deviates from the bounds of delegation legislation and is unconstitutional and unlawful by allowing the application of the former Inheritance Tax and Gift Tax Act, and thus, the above provision of the Enforcement Decree of the Income Tax Act should not be applied.

Article 63(1)1(a) and (3) of the former Inheritance Tax and Gift Tax Act (amended by Presidential Decree No. 2010, Jan. 1, 2011); and Article 63(1)1(a) and (3) of the former Inheritance Tax and Gift Tax Act (amended by Presidential Decree No. 2010, Jan. 1, 201); and Article 63(1)1(a) and (3) of the former Inheritance Tax and Gift Tax Act (amended by Presidential Decree No. 2010, Jan. 2

① Article 101 of the former Income Tax Act provides that a resident’s act or calculation is consistent with objective facts and is legally effective and lawful, and that it is accurate in the account, even if such act or calculation is a transaction between related parties, in the event that the act or calculation is deemed to have avoided or reduced the tax burden by using the various forms of transaction listed in each subparagraph of Article 167(3) and (4) of the former Enforcement Decree of the Income Tax Act, the taxation authority denies it and makes it deemed to have accrued the income which appears to be objective and reasonable by the method prescribed by statutes. This is not contrary to the substance over form principle, but rather to realize fair taxation by embodying the substance over form principle.

② In the case of capital gains tax, calculating the transfer value on the basis of the actual transaction price under the former Income Tax Act is in principle, but when it is deemed that the tax burden has been reduced unfairly, it is necessary to calculate the reasonable value on the grounds of the same paragraph (1). In particular, as the transfer of this case, there is a high possibility that the share transaction between related parties may form an unfair transaction price by mutual agreement between the parties in light of their personal characteristics and the interests between the parties to the transaction. Therefore, in order to regulate the transaction, it is deemed as one of the grounds for wrongful calculation, and the necessity of regulation is large. In addition, even in the case of each transaction type under Article 167 of the former Enforcement Decree of the Income Tax Act, it is difficult to deem that there is an excessive restriction beyond the purport of the

③ Article 60(1) of the former Inheritance Tax and Gift Tax Act (amended by Act No. 5193, Dec. 30, 1996; hereinafter “former Inheritance Tax and Gift Tax Act”) provides that “The value assessed according to the method of assessment stipulated in Article 63(1)1 (a) shall be considered as the market price for the purpose of excluding the arbitrariness in assessing listed stocks and securing objectivity.” The former Income Tax Act, which is based on the market price principle, basically has different aspects. However, in the former Income Tax Act, where the actual transaction price is deemed unfair even in the former Income Tax Act, the value which is considered as the tax base is similar in that it is calculated and applied, not the actual transaction price, rather than the actual transaction price, and thus, it is unreasonable to introduce the concept of the market price under the former Inheritance Tax and Gift Tax Act from the perspective of ensuring tax unity and equity.

④ Even if the transferor gains only the amount of the actual transaction value, he/she asserts to the effect that the transferor’s tax payment is unreasonable for the benefit or management premium that the transferee purchased at a price lower than the market price under the former Inheritance Tax and Gift Tax Act. However, as long as there exists a provision denying the transaction price at a low price by wrongful calculation in order to reduce the tax burden, it is possible for the transferor to set the transfer value including all the benefit or management premium that the transferee obtains by taking into account in advance, as long as there is a provision denying the transaction price at a lower price by wrongful calculation.

⑤ In comparison with the case of a donor or a decedent, the legislative purpose of the gift tax and inheritance tax are to prevent the donee and his heir from unfairly reducing the amount of tax, while imposing transfer income tax on the transferor, and the purpose of the tax assessment and taxation is to prevent the transferor from being unfairly reduced. However, the gift tax and the transfer income tax are different between the purchaser of assets and the transferor of assets. If the opposite person bears the tax, it seems that the legislator’s decision is to collect the legitimate amount of tax from the taxpayer. In addition, there is a difference between the two tax rates, as well as the taxpayer is different from each other, whether the person is exempt from the duty to pay tax by gratuitously transferring the owned assets through donation or inheritance method, or whether the transferor bears the transfer income tax with compensation or not, depends on the selection of the transferor.

(6) Article 44 (1) of the former Inheritance Tax and Gift Tax Act provides that "where property transferred to his/her spouse, or lineal ascendants or descendants (hereinafter referred to as "spouse, etc.") is presumed to have been donated at the time of transfer, the above provision shall not apply to cases where securities are disposed of through the securities market under Article 9 (13) of the Financial Investment Services and Capital Markets Act, but "cases prescribed by Presidential Decree where it is not deemed to have been disposed of by transactions between many and unspecified persons" shall apply. Article 33 (2) of the former Enforcement Decree of the Inheritance Tax and Capital Markets Act provides that "cases prescribed by Presidential Decree" under the proviso to Article 44 (3) 4 of the same Act means cases where the spouse, etc. is purchased or sold at an overseas market prescribed by Ordinance of the Ministry of Strategy and Finance among the sale and purchase of securities conducted in the securities market under Article 9 (13) of the Financial Investment Services and Capital Markets Act." Article 10-5 of the former Enforcement Rule (amended by Ordinance of the Ministry of Strategy and Finance No. 481, Mar. 13, 20148) of the Korea Exchange's.

This differs from the relevant laws and regulations of the transfer income tax that govern the appropriateness of the transfer value on the premise that the transaction was made. Therefore, it is difficult to view that the relevant provisions of the transfer income tax are inconsistent with equity on the ground that the spouse, etc. is not exempt from gift tax in the case of transfer by means of overtime trading at the closing price on the same day.

C) Therefore, the instant refusal disposition is lawful, and the prior Plaintiff’s assertion cannot be accepted on a different premise.

C. As to the rejection disposition of the securities transaction tax of this case

1) Article 7 (1) of the Securities Transaction Tax Act provides that "in case where share certificates are transferred pursuant to the provisions of each item of Article 3 (1)" as to the tax base under subparagraph 1 of Article 3, and Article 3 (1) of the Securities Transaction Tax Act provides that "in case where share certificates are transferred pursuant to the provisions of each item of subparagraph 1 of Article 3, the transfer price of such share certificates shall be the value of the share certificates

2) Since the instant shares fall under “shares transferred from the securities market” under Article 3 subparag. 1 (a) of the Securities Transaction Tax Act, it is reasonable to calculate the securities transaction tax with the tax base of KRW 00 per share of transfer value based on the closing price on the day of “transfer value of the relevant share” under Article 7(1)1 of the Securities Transaction Tax Act.

3) The Defendant asserts to the effect that the “share certificates under the provisions of each item of Article 7(1)1 of the Securities Transaction Tax Act” refers to the share certificates under each item of Article 3(1)1 in the case of transaction settlement between accounts pursuant to Article 3(1). However, since Article 3 of the Securities Transaction Tax Act and Article 7 of the same Act are different in terms of the provisions of each item, it is difficult to see that the determination of the tax base should be taken into account in determining the tax base of each subparagraph of Article 3 to the purport that the taxpayer is otherwise determined according to the method of transfer. In addition, in light of the literal interpretation of Article 7(1)1 of the Securities Transaction Tax Act and the relationship between each provision and each provision, it is difficult to regard the method of transfer as the purpose of specifying the type of “share certificates” as well as the method of transfer. In light of the literal interpretation of Article 7(1)1 of the Securities Transaction Tax Act, it cannot be interpreted as limited to the share certificates in the case of transaction settlement between accounts.

4) The rejection disposition of the securities transaction tax of this case is erroneous in the application of the relevant laws and regulations as to the tax base.

4. Conclusion

Therefore, the plaintiff's claim is accepted within the scope of the above recognition, and the remaining claims are dismissed as it is without merit. It is so decided as per Disposition.