Seocho 208west 4184 (209.04.07)

Whether a financial business operator is subject to education tax on sales of outstanding bonds;

The profit from the sale of sold bonds by the financial business operator is equivalent to the bad debts allowance and equivalent to the internal profit excluded from the education tax base.

The contents of the decision shall be the same as attached.

1. The defendant's rejection disposition of correction of KRW 283,830,680 against the plaintiff on September 18, 2008 is revoked. The defendant's rejection disposition of correction of KRW 283,830,680 against the plaintiff is revoked.

2. The costs of the lawsuit are assessed against the defendant.

The same shall apply to the order.

1. Circumstances of the disposition;

A. On April 1, 2006, the Plaintiff is a corporation that was merged between the former △△ Bank and the former △ Bank.

B. In order to lower the ratio of bad debts by issuing asset-backed securities (ABS) on the basis of loan claims, the former △△ Bank and the former △△ Bank (hereinafter referred to as the “Plaintiff”) established a special purpose company (SPC: SPC), which is a special purpose company (SPC), and sold loan claims to a special purpose company between February 2, 2005 and April 2005. The sales value set by the current value assessment of the above loan claims exceeds the book value of the loan claims (principal - bad debt allowances). Accordingly, the Plaintiff incurred KRW 56,76,136,168 in total sales profits of the instant loan claims corresponding to the difference, as shown below.

C. The Plaintiff reported and paid the total education tax amount of KRW 283,830,680 (hereinafter “instant education tax”) calculated by including the sales profit of the instant loan claims in the tax base of education tax.

D. On September 1, 2008, the Plaintiff requested the Defendant to correct the amount of education tax required for the refund of the education tax by deeming that the sales profit of the instant loan was not included in the tax base of education tax. However, on September 18, 2009, the Defendant rendered the instant disposition rejecting the Plaintiff’s request for correction on the ground that the sales profit of the instant loan constitutes the revenue of the finance and insurer, which serves as the education tax base.

【Ground for Recognition: Facts without dispute, Gap evidence 1-5, each entry with Gap evidence 2, the purport of the whole pleadings】

2. Whether the instant disposition is lawful

A. The plaintiff's assertion

The sales profit of the loan in this case is not a real and actual income but a bad debt allowance and an economic substance. Therefore, the inside of the provisions of Article 4 (2) 2 of the former Enforcement Decree of the Education Tax Act (amended by Presidential Decree No. 19339 of Feb. 9, 2006; hereinafter referred to as the "Enforcement Decree of the Education Tax Act") should be excluded from the education tax assessment.

(b) Related statutes;

It is as shown in the attached Table related statutes.

C. Determination

(1) Article 5(1)1 of the Education Tax Act provides that the revenue amount of a financial and insurance business entity shall be the tax base of education tax. Article 5(3) of the same Act provides that the amount of revenue of a financial and insurance business entity shall be the revenue amount of a financial and insurance business entity, and Article 5(1)3 of the Enforcement Decree of the Education Tax Act provides that ① the consideration for the provision of services, etc., such as interest, dividend, commission, guarantee fee, etc., and ② the sales profit of assets such as profit from the sale and redemption of a certificate of gift tax, ③ the amount individually and specifically listed as premium, and the amount determined by the Presidential Decree" shall be the same as the insurance premium, and the above "other amount determined by the Presidential Decree" shall be deemed to be the amount corresponding to this other than the type prescribed by the above Act. Accordingly, Article 4(1) of the Enforcement Decree of the Education Tax Act, which provides the type of tax base of the financial and insurance business entity's tax base upon delegation of the above provision, shall be interpreted as a standard type of taxation only where the financial and insurance business entity actually imports.

(2) However, as seen earlier, the proceeds from the sale of the loan claim in this case are merely those accrued in the account book when the bank set up a bad debt allowance in accordance with the corporate accounting standards and adjusted the amount reduced by the amount equivalent to the bad debt allowance in the principal of the loan loan in question as the book value of the loan loan in question, but the sales price exceeds the book value when selling the bad loan loan during the period of taxation thereafter, and then the excess amount is appropriated as earnings from non-business in accordance with the corporate accounting standards. In this case, the sales price of the bad loan loan in this case is larger than the book value, but it is smaller than the book value, so there is no substantial profits from the original principal of the loan.

Therefore, even if Article 4 (1) of the Enforcement Decree of the Education Tax Act provides that "other business profits and non-business profits" shall be subject to taxation, it does not include the profits from the sale of loan claims which are not actually profits but merely those counted in the account book, and it does not constitute "internal profits" as provided in Article 4 (2) 2, which is the revenue excluded from the education tax base, and it cannot be viewed that the profits from the sale of loan claims fall under the profits from the disposal of assets through foreign transactions, which are business profits under the corporate accounting standards.

(3) In addition, Article 4(1) of the Enforcement Decree of the Education Tax Act amended by Presidential Decree No. 22046 on February 18, 2010 provides for "the amount equivalent to the bad debts and bad debts and bad debts and bad debts of the claim" among the profits from sale or redemption of the claim, which is excluded from the previous education tax base by embodying "internal profits and bad debts" under Article 2(2)2 as being excluded from the previous education tax base. According to the revised Enforcement Decree of the Education Tax Act, the sales profits of the claim in this case generated by establishing bad debts more than the actual bad debts and are equivalent to the allowance for bad debts and are not included in "other business profits and bad debts" under Article 4(1)8 of the Enforcement Decree of the Education Tax Act, which is not included in "other business profits and bad debts" under Article 4(1)8 of the Education Tax Act, and this is reasonable in accordance with the purport of Article 5(3) of the Education Tax Act and its reasonable interpretation.

(4) Therefore, the instant disposition rejecting the Plaintiff’s claim for reduction or correction of the amount of education tax for the period of February 2, 2005 on the premise that the sales profit of the instant loan belongs to the revenue amount serving as the education tax base.

3. Conclusion

Since the plaintiff's claim is well-grounded, I accept it.