Whether corporate tax exemption and defense tax liability exist;

According to Article 2(2) of the Defense Tax Act and Article 3(1)3 of the Regulation of Tax Reduction and Exemption Act, even if corporate tax (including special surtax) is exempted pursuant to the Corporate Tax Act, the liability to pay corporate tax regardless of the liability to pay corporate tax.

Article 2(2) of the Defense Tax Act, Article 3(1)3 of the Regulation of Tax Reduction and Exemption Act

Supreme Court Decision 83Nu26 Decided June 28, 1983 85Nu71 Decided February 24, 1987

[Defendant-Appellee] Defendant 1 and 3 others (Attorney Seo Young-young et al.)

Head of the Office of Government

Seoul High Court Decision 86Gu711 delivered on February 19, 1987

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

The grounds of appeal are examined.

1. As to the first ground for appeal:

According to the reasoning of the judgment below, the court below held that the income from the transfer of each land of this case (the amount reverted to the business year from March 1, 1983 to February 28, 1984) falls under the subject of special surtax exemption under the premise that the "income from the transfer of basic property owned by a school foundation established under the Private School Act for the purpose of using it for educational business" under Article 59-3 (2) 3 of the Corporate Tax Act and Article 124-8 (1) of the Enforcement Decree of the same Act, which is the "income from the transfer of basic property owned by a school foundation established under the Private School Act for the purpose of using it for the educational business," and that the plaintiff is not eligible for special surtax exemption under the provisions of Article 59-3 (3) of the same Act and Article 124-8 (4) of the Enforcement Decree of the same Act. However, the plaintiff could not submit an application for special surtax exemption under the provisions of the above Enforcement Decree.

However, according to Article 68 (11) of the Enforcement Rule of the same Act amended by Ordinance of the Ministry of Finance and Economy No. 1556 of Feb. 28, 1983, the application for exemption of special surtax under Article 124-8 (4) of the Enforcement Decree of the same Act shall apply mutatis mutandis to attached Form 37 of the Enforcement Rule of the Income Tax Act. It is clear that the Ministry of Finance and Economy has provided for the application for exemption of special surtax

Nevertheless, the decision of the court below that the plaintiff could not submit an application for exemption of special surtax because the Ordinance of the Ministry of Finance and Economy on the application for exemption of special surtax has not been provided is unlawful as it is against the provision of the above Enforcement Rule. It is reasonable to point out this error.

2. On the second ground for appeal:

According to Article 2(2) of the Defense Tax Act and Article 3(1)3 of the Regulation of Tax Reduction and Exemption Act, even if corporate tax (including special surtax) is exempted pursuant to the provisions of the Corporate Tax Act, it is interpreted that there is a liability to pay defense tax regardless of the liability to pay corporate tax (see Supreme Court Decision 85Nu71, Feb. 24, 1987; Supreme Court Decision 83Nu26, Jun. 28, 1983).

The court below's decision that a person who is exempted from special surtax pursuant to the provisions of the Corporate Tax Act is not a person liable for defense tax shall be deemed to have committed an unlawful interpretation of the above provision. It is reasonable to point out the error of this error.

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

Justices Yellow-ray (Presiding Justice)