Whether “the total floor area of the building in the relevant Si/Gun” and “the total floor area of the building in the relevant Si/Gun” shall be calculated according to the same standard in the formula of Article 130-5(1) of the former Enforcement Decree of the Local Tax Act, which provides for the amount of tax payable by the corporation to each Si/Gun (affirmative), and whether the resident tax to be paid to another Si/Gun shall be calculated in the event that the assessment of the resident tax for the corporate tax of a certain Si/Gun becomes final and conclusive and cannot be asserted (affirmative), and whether the calculation of the resident tax to be paid to another Si/Gun should be based on the calculation of the total floor area of the building in the final and conclusive Si/Gun, rather than

Article 172 Subparag. 4 of the former Local Tax Act (Amended by Act No. 9924, Jan. 1, 2010; see current Article 89(2)); Article 175(3) (see current Article 89(1)); Article 130-5(1) of the former Enforcement Decree of the Local Tax Act (Amended by Presidential Decree No. 20708, Feb. 29, 2008; see current Article 88)

Korea hydroelectric Power Co., Ltd. (LLC, Kim & Lee LLC, Attorneys Kim Jong-ho et al., Counsel for the defendant-appellant)

Ulsan-gun (Attorney Hwang-ho, Counsel for the defendant-appellant)

Daegu High Court Decision 2012Nu2222 decided October 25, 2013

The appeal is dismissed. The costs of appeal are assessed against the defendant.

The grounds of appeal are examined.

1. As to the assertion of misapprehension of legal principles as to the imposition of the resident tax to be imposed on each Si/Gun or the calculation of such tax amount

A. According to Article 172 Subparag. 4 of the former Local Tax Act (amended by Act No. 924, Jan. 1, 2010; hereinafter the same), resident tax subject to corporate tax is the tax base of “corporate tax to be paid under the Corporate Tax Act.” Article 175(3) proviso of the former Local Tax Act and Article 130-5(1) of the former Enforcement Decree of the Local Tax Act (amended by Presidential Decree No. 20708, Feb. 29, 2008) provides that where a corporation’s place of business is located in two or more Sis/Guns, resident tax subject to corporate tax shall be imposed in the Si/Gun having jurisdiction over the location of the place of business, and the amount of tax to be paid by each corporation to each Si/Gun shall be calculated in accordance with the instant formula (hereinafter “instant formula”).

Since the instant formula aims to fairly distribute the total amount of corporate tax, which serves as the tax base for corporate tax, to each Si/Gun where the place of business is located, the “total floor area of the building in the relevant Si/Gun” and “total floor area of the corporation” in the instant formula shall be calculated according to the same standard. In addition, since the imposition disposition of corporate tax to be imposed on each Si/Gun where the place of business is located is separate disposition, even if the imposition disposition of resident tax to be imposed on a certain Si/Gun becomes final and conclusive as the lapse of the objection period, and thus it cannot be asserted any longer, when calculating the resident tax to be paid to another Si/Gun, the total floor area of the building in the Si/Gun where the imposition disposition of corporate tax to be imposed on corporate tax has become final and conclusive shall be calculated according

B. The lower court determined that the Defendant’s disposition of this case imposing the Plaintiff with a place of business outside its jurisdiction increased and imposed the resident tax for the year 2003 to the year 2005 pro rata corporate tax, and that it was unlawful for the Defendant to calculate the Plaintiff’s total floor area of the building in the place of business within the jurisdiction of the Defendant to include the area (e.g., the horizontal projected area; hereinafter the same) of the conduits, such as the irrigation and drainage pipes, in the total floor area of the building in the place of business within the jurisdiction of the Defendant, but instead the area of the conduits in another Si/Gun,

Furthermore, the court below rejected the defendant's assertion that the new addition of the total floor area of a building located in another local government is not subject to a revised report and thus cannot be asserted on the ground that the new addition of the total floor area of a building located in another local government is not subject to a revised report, since the defendant's disposition of this case, which increased and adjusted without considering the area of the conduit located in another Si/Gun, was disputed about the illegality of the disposition of this case itself.

C. Examining the reasoning of the lower judgment in light of the evidence duly admitted, the lower court’s determination is based on the aforementioned legal doctrine. In so doing, contrary to what is alleged in the grounds of appeal, there were no errors by misapprehending the legal doctrine on the confirmation of resident tax to be imposed on the method of tax payment, the validity of the increased or decreased disposition under the Framework Act on National Taxes, the independence

2. As to the assertion of misapprehension of legal principles as to burden of proof

In general, since the tax authority bears the burden of proving the facts of taxation requirements in a lawsuit seeking revocation of a tax imposition disposition, if the tax authority fails to directly prove the facts of taxation requirements or to state the presumed facts of taxation requirements in light of the empirical rule in the course of a specific lawsuit, such taxation disposition constitutes an illegal disposition that fails to meet the taxation requirements (see Supreme Court Decision 2010Du20805, Mar. 28, 2013,

The court below revoked the part of the disposition of this case which the plaintiff sought revocation on the ground that the defendant is responsible for asserting and proving the area of an official road located within the jurisdiction of another Si/Gun, which is the premise for the disposition of this case, and that it is not possible to calculate the area, and it is impossible to calculate the fair corporate tax due to the failure to submit materials to calculate the area.

Examining the reasoning of the judgment below in light of the records, the judgment of the court below is based on the above legal principles, and there is no error in the misapprehension of the burden of proof of taxation requirement or the legal principles as to the court's duty to explain.

3. Conclusion

Therefore, the appeal is dismissed, and the costs of appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Shin Young-chul (Presiding Justice)