Suwon District Court 2007Guhap7094 (No. 30, 2009)

National High Court Decision 2007J0957 (Law No. 14, 2007)

Whether the face value of a gift certificate shall be deducted when calculating the game room tax base.

In calculating the value-added tax base in the game place where merchandise coupons are offered as free gifts, it is reasonable to view that the value of the merchandise coupon or its acquisition value cannot be deducted from the total amount input by the game machine users in the game machine.

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

1. The plaintiff's appeal is dismissed.

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

The judgment of the first instance shall be revoked. Each disposition of value-added tax for the second term of 205 against the Plaintiff on January 5, 2007 by the Defendant shall be revoked in the imposition of value-added tax for the second term of 389,424,270, and value-added tax for the first term of 206, and value-added tax for the first term of 2006.

1. Details of the disposition;

A. From October 13, 2005 to July 13, 2006, the Plaintiff operated an adult game room (hereinafter “instant game room”) under the trade name called DD DD 1014-3 DDD 103 and 104 “CCC Gameland.” The instant game room was operated in the form of providing gift certificates of face value 5,00 won if the game user inputs a certain amount of cash in the game machine and satisfies the requirements prescribed in the game machine.

B. The Plaintiff reported the value-added tax on February 2005 and January 2006 to the Defendant, and filed a value-added tax return on the remainder of the amount calculated by deducting the value of gift certificates paid to game users as free gifts from the amount invested in a game machine by the game user.

C. The defendant confirmed the purchase of gift certificates of KRW 750,00 and KRW 756,00 for the taxable period of the value-added tax on February 2, 2005 and January 1, 2006, the plaintiff purchased gift certificates of KRW 750,00 through the gift certificates sales details reported to the Korea Game Industry Development Institute ("the Korea Game Industry Development Institute" as an incorporated foundation; hereinafter "the Korea Game Industry Development Institute"). On January 5, 2007, the defendant calculated the value-added tax base by dividing the purchase amount of gift certificates into the dividend rate and calculating the purchase amount of gift certificates of KRW 389,424,270 for the two-year period of value-added tax in 2005 and the value-added tax on KRW 376,571,330 for the first year of value-added tax in 206 (hereinafter "the disposition in this case").

D. On March 16, 2007, the Plaintiff filed an appeal with the National Tax Tribunal on March 16, 2007, but was dismissed on May 14, 2007.

【Grounds for Recognition: Evidence Nos. 1 to 3, and No. 1

2. Relevant statutes;

Attached Form is as shown in the attached Form.

3. Whether the instant disposition is lawful

A. Whether the amount obtained by deducting the face value of a gift certificate should be the gross sales

(1) The plaintiff's assertion

The plaintiff asserts that when calculating the value-added tax base of the game of this case, gross sales should be viewed as the amount obtained by deducting the face value of gift certificates offered to users as free from the total cash input by the users of the game of this case.

(2) Determination

However, Article 1 (1) 1 of the former Value-Added Tax Act (amended by Act No. 8142 of Dec. 30, 2006; hereinafter referred to as the "Act") provides that "supply of goods or services" shall be subject to value-added tax. Article 1 (3) of the same Act provides that "any services and other acts having property value other than goods". Article 13 (1) of the Act provides that "the tax base of value-added tax for the supply of goods or services shall be the total value of each subparagraph of AA.". Article 13 (3) provides that "if the price is paid in money, the price shall not be deducted from the tax base." Article 1 (2) provides that "The price shall not be deducted from the discounted value of goods or services that is similar to the above amount of money." Article 1 (3) provides 20-1 of the former Value-Added Tax Act to users of merchandise coupons which are not subject to value-added tax base, unlike income tax or corporate tax, it is reasonable to provide 20-10-6-3 gift certificates that are supplied as gift certificates.

(b) Whether the data produced by the Game Industry Development Institute is unlawful, for which the estimated imposition of sales in the game room is based;

(1) The plaintiff's assertion

The plaintiff asserts that the gift certificates offered as the gift certificates of this case in the second half of 2005 are different from the objective facts for the following reasons from the data prepared by the Game Industry Development Institute (No. 4-2; No. hereinafter referred to as the "Game Industry Development Institute data") which was the first half of 750,000, the first half of 2006, the first half of 756,000, the first half of 206, and the first half of 1,506,000, and the confirmation document prepared to the effect that the plaintiff all of the books and evidential documents related to the game venue business of this case were disposed of (No. 1-6; hereinafter referred to as "certificate No. 1-6; hereinafter referred to as the "certificate") and that the amount of the gift certificates actually purchased by the plaintiff is in violation of the principle of taxation on the game industry of this case and the sales based on the estimation from October 13, 2005 to December 31, 2006.

(A) The data of the Game Industry Development Institute is based on the contents reported by AAB, Inc., a merchandise coupon issuer (hereinafter referred to as “AAS”) by BB, a general sales company. The BB is highly likely to supply merchandise coupons to companies registered as business operators as the Plaintiff without basis of the accurate actual transaction details, and make a false report as to the supply of merchandise coupons in excess of the actual supply amount. The issuer, a general sales company, and a general sales agency, and a merchandise coupon’s agent, which are distributed in the order of the merchandise coupon distribution structure, are prepared only on the basis of the highest-level issuer’s report that does not know the purchase amount of merchandise coupons at the lowest specified game site in the order of the merchandise coupon distribution structure.

(B) The quantity of gift certificates recorded in the data of the Game Industry Development Institute is 24 hours out of the 40 game machine installed in the game game of this case, and 75,000 won per hour is input per l unit of the game of this case. However, it is difficult to view that the game of this case was operated in light of the size and circumstances of the game of this case, such as the game of this case, where the game of this case is located, D was unable to engage in a normal business due to locked work, and there was no number of customers at the same time, and CCC game of this case was 10 billion won and approximately 24 hours per 400,000 won won won, and it is difficult to view that it was a machine required for approximately 2 hours per hour per hour during the printing of gift certificates of this case 400,000 won per l unit of the game of this case as contrary to the characteristics of the game of this case.

(C) In the situation where the Plaintiff was unable to easily grasp the whereabouts of taxation data due to the closure of business, the confirmation document was prepared according to the Plaintiff’s use of a confirmation document as the Plaintiff, who visited the Defendant’s tax office on October 20, 2006, with the intent of reducing the amount of estimated taxation in line with the data of the Game Industry Development Institute, which was already secured by the Defendant’s employee, around October 20, 2006. The confirmation document was prepared by the Plaintiff’s defective intent, and thus, it shall not be the basis for estimated taxation.

(2) Determination

(A) The tax base and tax amount of value-added tax are determined based on the actual amount revealed by the method of the on-site investigation, and in order to determine it by the method of the on-site investigation, it is exceptionally allowed only when there is no taxpayer’s account books or documentary evidence, or there is no other method that the tax authority has no credibility because the important part is insufficient or false (see, e.g., Supreme Court Decision 98Du915, Oct. 8, 199). If it is reasonable and reasonable to reflect the actual amount near the truth in the method and content of the estimation in imposing such estimated tax, if it is reasonable and reasonable to reflect the actual amount near the truth (see, e.g., Supreme Court Decision 9Nu15756, Jun. 27, 1997). In addition, the burden of proving the necessity and rationality of the estimated tax, which is the requirement of the taxation in the estimated tax, is once against the tax authority (see, e.g., Supreme Court Decision 87Nu175, Oct. 25, 1987).

(B) However, on October 19, 2006, the defendant sent 30% of the total amount of the gift certificates purchased by the plaintiff (AAS, BB, par value 500) 70,000 per 205, 756,000 per 206, 106, 30% of the total amount of the gift certificates per 60,000, 106, 206, 30% of the total amount of the gift certificates per 60, 106, 206, 106, 206, 106, 30% of the total amount of the gift certificates per 60, 106, 206, 106, 206, 30% of the total amount of the gift certificates per 60, 106, 206, 30% of the total amount of the gift certificates per 60,000, 206.

(C) Therefore, the Plaintiff is arguing the purchase volume of gift certificates, which are elements of calculating the tax base of value-added tax, due to the said estimated taxation, and does not dispute the necessity, rationality, and calculation method of estimated taxation. Therefore, the issue of the instant case is whether to calculate the purchase volume of gift certificates based on the data of the Game Industry Development Institute, or to calculate it based on the gift purchase ledger (Evidence A No.

However, there is no objective and reliable data suggesting the plaintiff that the data of the Game Industry Development Institute on the quantity of merchandise coupons purchased are inconsistent with the facts of the Korea Game Industry Development Institute, and that AASs made a false report. The ledger presented by the plaintiff is inconsistent with the contents of the written confirmation that the plaintiff discarded books, etc. related to the operation of the game of this case as seen earlier. It is hard to believe that there is no objective data, such as the details of payment supporting reliability and the payment of merchandise coupons, and there is no objective data, such as the receipts and disbursements of merchandise coupons. Even according to the testimony of the court of first instance, it is difficult to conclude that the merchandise coupon dealer supplied merchandise coupons to the Korea Game Industry Development Institute, regardless of the actual sales details of merchandise coupons, regardless of the size of the game of the game of this case, and the characteristics and operation situations of the game machine, it is difficult to conclude that the number of merchandise coupons purchased from the data of the Korea Game Industry Development Institute, even if considering the size of the game of the game of this case claimed by the plaintiff, it is reasonable to view that the defendant calculated the most reasonable and reasonable amount of the supply price calculated by estimation.

(D) Therefore, the Plaintiff’s assertion is without merit, since the determination of the value-added tax base based on the aforementioned estimation method is contrary to the underlying taxation principle or cannot be deemed unlawful due to lack of rationality and feasibility in the process of the estimation taxation.

4. Conclusion

Therefore, the plaintiff's claim seeking the revocation of the disposition of this case is unlawful, and it is dismissed as it is without merit, and the judgment of the court of first instance is justified. The plaintiff's appeal is dismissed. It is so decided as per Disposition.