Cho Jae-2013-China-2944 ( December 30, 2013)

The reason for the application of zero-rate export goods is for taxpayers.

The reason for falling under the export goods to which zero-rate tax rate applies belongs belongs to a special reason that exceptionally affects payment or the determination of tax refund, and thus, the burden of alleged admission to the tax payment is against the taxpayer.

Article 11 (Application of Zero Tax Rate)

2014Guhap2592 Revocation of Disposition of Imposition of Value-Added Tax

Ansan ○

○ Head of tax office

April 29, 2015

May 13, 2015

1. The plaintiff's claim is dismissed.

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

On March 24, 2014, the Defendant revoked the imposition of value-added tax of KRW 4,221,339, KRW 206, KRW 3,761,548, KRW 2006, KRW 5,321,840, KRW 6,354, KRW 188, and KRW 4,767,527, KRW 4,767, KRW 208, KRW 4,918, KRW 581, KRW 20,209, KRW 313,831, and KRW 20,3313, and KRW 2031, to the extent that it does not go against the intent of the Party).

1. Details of the disposition;

A. On March 14, 2006, the Plaintiff: (a) was a business operator who was engaged in the export and import of recycled goods, etc. until the closure of his business on December 31, 2011, with the trade name of ○○○○ Trade Corporation; (b) paid value-added tax as indicated in the separate sheet column for value added tax payable; (c) “the director of ○○○○○ Tracing Co., Ltd (hereinafter referred to as “○○○○”)” (the head of ○○ ○○ ○○ ○○”)’s business owner; and (d) notified the Defendant of the fact that the Plaintiff reported value-added tax by omitting sales of ○○ ○○ ○ ○○ Trade, which was operated by the Plaintiff on March 14, 2006; and (e) the Defendant determined the tax base for value-added tax as stated in the separate sheet for value-added tax, including the sales revenue in the separate sheet for correction; and (e) notified the Plaintiff to pay the amount of value-added 2 as stated in the separate column 3.

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

The Plaintiff introduced a Chinese importer of the waste vinyl and waste plastics from Seo-○○ to directly transmit the goods to the importer, but the goods supplied by the Plaintiff through Seo-○○○ is paid in Korean won or in foreign currency only for the price. Thus, the above goods supplied by the Plaintiff through Seo-○○ constitutes the goods to be exported. Therefore, when filing a value-added tax return for the pertinent taxable year, the Plaintiff did not report the sales amount to be made by applying the zero-rate tax rate for the above goods, and the Defendant’s disposition imposing value-added tax on the premise that the parts traded with Seo-○○○ were not export

(b) Related statutes;

It is as shown in the attached Table related statutes.

(c) Fact of recognition;

1) From August 2005, ○○○○○○’s business owner purchased waste plastics in Korea, exported them to Hong Kong, and China, and reported it to the customs office at a lower price than the actual export price. On May 2010, the head of the Seoul Customs office investigated a child under suspicion of the export price manipulation, property flight and criminal proceeds concealment, and sent it to the prosecution by committing a violation of the Foreign Trade Act, the Aggravated Punishment, etc. of Specific Economic Crimes Act (property flight), and the Regulation and Punishment of Concealment of Criminal Proceeds to the prosecution.

2) The director of the regional tax office of ○○○ was notified of the above facts from the head of the Seoul Customs Office, and found that the result of the investigation of the transaction details of ○○○ from 2005 to 2009, and that the amount that the Plaintiff received from ○○○○○ from the Plaintiff was 696,243,855 won, and that the supply price for ○○○○ reported as the sales tax invoice by the Plaintiff was 83,406,400 won.

3) The Defendant: (a) calculated the Plaintiff’s sales from January 2006 to February 2, 2009; (b) imposed value-added tax again; and (c) partially reduced the Plaintiff’s tax appeal, thereby resulting in the instant disposition.

4) The Plaintiff requested ○○○○ to export directly to a Chinese importer under the name of ○○ Trade Corporation. However, regarding this part, the Plaintiff filed an export declaration certificate, etc. under the name of ○○ Trade Corporation and filed an export declaration on the customs house. Moreover, at the time of the Plaintiff’s filing of the value-added tax, the Plaintiff applied zero tax rate.

Grounds for recognition, Gap evidence 1, 2 (including the number in case of household number), and Eul evidence 5 through 11, and the purport of the whole pleading

D. Determination

1) Article 11(1)1 of the former Value-Added Tax Act (amended by Act No. 11873, Jun. 7, 2013) provides that the zero-rate tax rate shall apply to the supply of exported goods, and Article 24(1)1 of the former Enforcement Decree of the Value-Added Tax Act (amended by Presidential Decree No. 24638, Jun. 28, 2013) provides that exports refer to shipping domestic goods out of Korea to foreign countries. Meanwhile, in imposing value-added tax, the tax authority bears the burden of proving the value of supply, but the reason for the imposition of value-added tax constitutes the exported goods subject to the zero-rate tax, which falls under special grounds that exceptionally affect payment or the determination of refundable tax, and thus, it is reasonable to deem that the taxpayer is liable

2) In light of the following circumstances revealed by the Plaintiff’s health and recognition, namely, customs-related documents, such as a statement of export performance corresponding to the amount, should be submitted in order for the Plaintiff to be subjected to zero-rate tax on the remitted portion from the side of Western ○○, in order to apply the zero-rate tax on the instant case. The Plaintiff was subject to criminal punishment for suspected price manipulation, etc. of export goods including the portion of goods supplied by the Plaintiff at the time of the Plaintiff’s declaration of value-added tax return. If the Plaintiff was directly exported, it is insufficient to recognize that the evidence submitted by the Plaintiff was directly exported to the relevant Chinese importer, and there is no evidence to acknowledge otherwise.

Therefore, the plaintiff's assertion is without merit, and the defendant's disposition of this case is legitimate.

3. Conclusion

Therefore, the plaintiff's claim is dismissed as it is without merit. It is so decided as per Disposition.