The purport of Article 5(8) of the former Enforcement Decree of the Inheritance Tax Act and whether the same provision deviates from the scope of delegation under Article 9(2) of the former Inheritance Tax Act or violates the principle of no taxation without law (negative)

Article 5(8) of the former Enforcement Decree of the Inheritance Tax Act (amended by Presidential Decree No. 15193, Dec. 31, 1996) provides that the officially assessed individual land price shall be publicly announced on January 1 of each year on the basic date, but it is necessary to investigate the current status of land for calculating such officially assessed individual land price, so the public announcement shall be made by applying the officially assessed individual land price of the year in which the publicly announced individual land price is adjacent to the market price in a case where inheritance or donation is not publicly announced for a considerable period of time, taking into account that it is possible or possible to do so after the considerable period of time from the basic date, so that the taxpayer or the tax authority may expect a prior estimate or early determination of the legal relations, even before the publicly announced individual land price of the year is publicly announced, and thus, it cannot be said that the purpose of the public announcement is to achieve legal stability and predictability by allowing the taxpayer or the taxpayer to pay taxes at a higher level than the market price under the publicly announced individual land price of the previous year to pay taxes at the length of tax.

Articles 9(1) and (2) (see current Article 60 of the Inheritance Tax and Gift Tax Act), and 34-7 (see current Article 60 of the Inheritance Tax and Gift Tax Act) of the former Inheritance Tax Act (amended by Act No. 5193, Dec. 30, 1996); Article 5(2)1(a) (see current Article 61(1) of the former Enforcement Decree of the Inheritance Tax and Gift Tax Act (amended by Presidential Decree No. 15193, Dec. 31, 1996); Article 5(2)1(a) (see current Article 61(1)); Article 61(8) (see current Article 50(6) of the Inheritance Tax and Gift Tax Act) and Article 42 of the former Enforcement Decree of the Inheritance Tax and Gift Tax Act

Plaintiff (Law Firm Jina, Attorneys Yoon Young-won et al., Counsel for the plaintiff-appellant)

The head of Gangnam District Tax Office (Attorney Choi Jong-soo, Counsel for defendant)

The head of Sungnam-si Subdivision

Seoul High Court Decision 98Nu11399 delivered on December 31, 1998

The judgment below is reversed and the case is remanded to Seoul High Court.

1. As to the validity of Article 5(8) of the former Enforcement Decree of the Inheritance Tax Act (amended by Presidential Decree No. 15193, Dec. 31, 1996; hereinafter referred to as the "Enforcement Decree"), which is the basis for the taxation of this case, Article 9(1) and (2) of the former Inheritance Tax Act (amended by Act No. 5193, Dec. 30, 1996; hereinafter referred to as the "Act") shall adopt the principle of market price as to the method of calculating the taxable value of donated property, where it is difficult to calculate the market price, the court below shall delegate the supplementary method of calculating the value of the land to the Presidential Decree, and Article 5(2)1(a) of the former Enforcement Decree of the Inheritance Tax Act, which provides that the value of the land shall be calculated based on the supplementary method of calculating the market price of the land to the extent that the new officially assessed individual land price of this case is not applied to the market price of this case, which is more than nine (9) days before the date of donation.

2. Article 9(1) of the Act provides that the value of inherited property shall be the current status as at the time of commencement of the inheritance. Article 9(2) provides that when it is difficult to calculate the market price under the current status as at the time of commencement of the inheritance, the value of inherited property shall be the current market price as at the time of commencement of the inheritance. Article 5(1) of the Enforcement Decree provides that “the method as determined by the Presidential Decree” under Article 9(2) of the Act means the valuation of inherited property under the provisions of paragraphs (2) through (7) of the Act, and Article 5(2)1(a) of the Enforcement Decree provides that “the method as determined by the Presidential Decree” means the assessment of inherited property under the provisions of Article 9(2)1(a) of the Act, other than the area designated by the Commissioner of the National Tax Service. In applying Article 5(8) of the Act, if the inheritance begins before the new individual land price is announced, the former individual land price shall not be applied to the person liable to pay taxes at an early and later than the new individual land price.

Nevertheless, the court below held that Article 5 (8) of the Enforcement Decree of the Act exceeds the scope of delegation by the parent law or is null and void as it violates the principle of no taxation without law, and thus, the invalid part of the disposition of this case is unlawful. In so doing, the court below erred by misapprehending the legal principles on Article 9 (2) of the Act, which affected the conclusion of the judgment

3. Therefore, without examining the remaining grounds of appeal, the judgment of the court below is reversed, and the case is remanded to the court below for a new trial and determination. It is so decided as per Disposition by the assent of all participating Justices.

Justices Yoon Jae-sik (Presiding Justice)