A. The purport of Articles 80 and 81 of the former Income Tax Act

(b) Whether the business income amount is added up when calculating the income amount of the family subject to summing up assets; and

A. The purport of Articles 80 and 81 of the former Income Tax Act (amended by Act No. 4803 of Dec. 22, 1994) which provides for the cumulative taxation of property income, as special cases in the calculation of the tax amount, is to consider the taxable capacity for each household unit in cases where there is property income among the members of a household, not only is it reasonable to consider the taxable capacity for each individual unit rather than the individual unit taxation, but also because it is easy to reduce the tax burden by distributing the name to the members of a family, deeming the household as the taxable unit can prevent the act of tax evasion. In addition, applying the progressive tax rate by aggregating the property assets, it is from the reason that the fair tax burden can be realized according to the taxable capacity. This does not intend to impose tax by separating the income other than the property income, in which there is a loss other than the property income, and only the property income is removed separately, as the tax base.

B. The provisions of Article 58 of the former Income Tax Act (amended by Act No. 4661 of Dec. 31, 1993) and Article 113 of the former Enforcement Decree of the Income Tax Act (amended by the Presidential Decree No. 14083 of Dec. 31, 1993) concerning the total amount of losses are special provisions concerning the calculation of income amount. Thus, the special provisions concerning the cumulative taxation of property income, which is the special exception to the calculation of income amount, are applied prior to the calculation of income amount. According to the above provisions, losses incurred to the calculation of income amount of the principal income earner or the family subject to cumulative taxation of assets, shall be calculated for each income earner pursuant to Article 113(2) and (3) of the Enforcement Decree of the Income Tax Act. However, in the calculation of real estate income amount, losses incurred to the principal income earner shall not be deducted from the income amount or dividend income amount of the family subject to cumulative taxation, and the provisions concerning the cumulative taxation of property income of the principal income earner referred to in Article 138(1) of the same Act.

A.B. Articles 80 and 81(b) of the former Income Tax Act (amended by Act No. 4803 of Dec. 22, 1994); Article 58(1) of the former Income Tax Act (amended by Act No. 4661 of Dec. 31, 193); Article 113(2) of the former Enforcement Decree of Income Tax Act (amended by Presidential Decree No. 14083 of Dec. 31, 1993); Article 113(3) of the former Enforcement Decree of Income Tax Act (amended by Presidential Decree No. 14083 of Dec. 31, 1993); Article 113(5) of the former Enforcement Decree of Income Tax Act (amended by Presidential Decree No. 14083 of Dec. 31, 1993)

Plaintiff 1 et al., Counsel for the defendant-appellant

Head of Mapo Tax Office

Seoul High Court Decision 93Gu23956 delivered on April 28, 1994

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

The grounds of appeal are examined (to the extent of supplement in case of supplemental appellate brief and supplemental appellate brief filed after the lapse of the period for submitting the grounds of appeal).

1. On the first ground for appeal

According to the reasoning of the judgment below, the court below determined that the gross income other than the plaintiff 2's property income in 1990 is -938,407,174 won for business income, 85,750,000 won for earned income, and -825,657,174 won for total income other than the property income in 191, and -1,275,089 won for global income other than the property income in 191, and -1,275,089,959 for global income. The fact that the largest person among the above plaintiff's family members for total assets other than the above plaintiff's plaintiff's family members is her child, and pursuant to Article 80 (1) of the Income Tax Act and Article 131 (1) 1 of the Enforcement Decree of the same Act of the Income Tax Act, the principal income person is the largest person of global income other than the property income amount among the family members for total assets. In this case, the judgment of the court below is justified and without merit.

2. On the second ground for appeal

The purpose of the provisions of Articles 80 and 81 of the Income Tax Act, which provide for the cumulative taxation of property income in the calculation of the tax amount, is to consider the taxable capacity for each household unit rather than that for each individual household, and to reduce the tax burden due to the distribution of the name to the family members, so it can prevent the tax avoidance act. In addition, the application of cumulative tax rate to the property income can be realized fairly in accordance with the taxable capacity. In addition, even though there are losses other than the property income, it is not intended to impose tax until the income is calculated as the tax base by disregarding that it is more than the actual income, while the provisions of Article 58 of the Income Tax Act (amended by Act No. 461 of Dec. 31, 193), Article 113 of the Enforcement Decree of the Income Tax Act (amended by Presidential Decree No. 14061 of Dec. 31, 1993) concerning the total amount of loss of the above business income subject to cumulative taxation by the above Article 13 of the Enforcement Decree of the Income Tax Act.

However, the court below held that the provisions of Article 58 of the above Act shall not be applied to property income taxation, and it shall not be deemed that the total amount of losses between other income except for property income under the former part of Article 113(5) of the above Enforcement Decree shall be deemed to mean only the total amount of losses among the other income. Under the premise that the property income of the family subject to the sum of the assets subject to the sum of other income amounts refers to only the property income itself that is not added to the other income losses by the family subject to the sum of the assets subject to the sum of the assets subject to the sum of the assets subject to the sum of losses and the income subject to the sum of the assets subject to the sum of the assets subject to the sum of the assets subject to the sum of the assets subject to the sum of the assets subject to the deficits and the income subject to the

3. Therefore, the lower judgment is reversed, and the case is remanded to the lower court. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Cho Chang-tae (Presiding Justice)