[1] In cases where a disposition to adjust the amount of national taxes for the same taxable period and the same tax item was made after the initial return or the payment was made, the initial date of calculation of the additional refund of national taxes (=the day following the date of payment of national taxes, respectively)

[2] Where Party A paid an amount of comprehensive real estate holding tax for 2009, including comprehensive real estate holding tax for 2010, and reported and paid comprehensive real estate holding tax for 2010, and additionally paid comprehensive real estate holding tax for 2009 and 2010 increased due to the taxing authority’s first and second disposition for correction on the ground of the addition of taxable objects, etc., the case held that the lower court determined the amount of property tax for 2009 and 2010, which Party A paid in excess on the ground that the amount of property tax for 209 and 2010 should be deducted when calculating the amount of comprehensive real estate holding tax for 209 and 2010 under the proviso to Article 43-3(1)1 of the Enforcement Decree of the Framework Act on National Taxes, and calculated the amount of additional tax for refund in consecutive order from the date following the date of the last payment of comprehensive real estate holding tax for 2009 and 2010, respectively, and that the date of additional tax for refund should be determined differently.

[1] Considering Article 52 of the former Framework Act on National Taxes (amended by Act No. 15220, Dec. 19, 2017); Article 43-3(1)1 main text and proviso of the Enforcement Decree of the same Act; Article 43-3(1)1 of the same Act and Article 43-3(1)1 of the same Decree, the content, structure, and the fact that the refund of national taxes is paid in the nature of legal interest as to the refund of national taxes after payment, it is reasonable to deem that the initial date of calculation of the refund of national taxes is “the day following the payment date of national taxes” pursuant to the main sentence of Article 43-3(1)1 of the Enforcement Decree of the Framework Act on National Taxes, unless the refund of national taxes accrued after cancellation of the return or imposition that served as the basis of the refund of national taxes after payment is made in two or more installments pursuant to the proviso of Article 43-3(1)1 of the Enforcement Decree of the Framework Act on National Taxes.

[2] Where Party A paid an amount according to the disposition of comprehensive real estate holding tax for 2009, including comprehensive real estate holding tax for 2010, and reported and paid comprehensive real estate holding tax for 2010, and additionally paid comprehensive real estate holding tax for 2009 and 2010 increased due to the disposition of taxing the taxing authority for the addition of taxable objects, etc., the case held that the lower court determined the amount of property tax for 209 and 2010 which Party A paid for 209 and 2010 on the ground that the amount of property tax to be deducted was undercalculated when calculating the amount of comprehensive real estate holding tax for 209 and 2010, and determined the amount as refund and additional payment for additional tax for 209 and 2010 under the proviso to Article 43-3 (1) 1 of the Enforcement Decree of the Framework Act on National Taxes as the date of the first disposition of comprehensive real estate holding tax for 209 and 2010, and determined the amount of additional tax for 3 years thereafter.

[1] Article 52 of the former Framework Act on National Taxes (Amended by Act No. 15220, Dec. 19, 2017); Article 43-3(1)1 of the Enforcement Decree of the Framework Act on National Taxes / [2] Article 52 of the former Framework Act on National Taxes (Amended by Act No. 1520, Dec. 19, 2017); Article 43-3(1)1 of the Enforcement Decree of the Framework Act on National Taxes

National Agricultural Cooperative Federation (LLC, Kim & Lee LLC, Attorneys Yu-type et al., Counsel for the defendant-appellant)

Korea

Seoul Central District Court Decision 2018Na1840 decided July 16, 2018

The judgment below is reversed, and the case is remanded to the Seoul Central District Court.

The grounds of appeal are examined.

1. Article 52 of the former Framework Act on National Taxes (amended by Act No. 15220, Dec. 19, 2017) provides that "in cases where the head of a tax office pays a national tax refund, the refund of national tax shall be added to the national tax refund calculated according to the period from the date the additional payment of national taxes prescribed by Presidential Decree begins to the date the payment is determined, and the interest rate prescribed by Presidential Decree (hereinafter "additional payment of national taxes") is calculated. According to delegation, the main sentence of Article 43-3(1)1 of the Enforcement Decree of the Framework Act on National Taxes provides that "in cases where a national tax refund occurs following erroneous payment, double payment, or correction (excluding cases falling under subparagraph 5) of a return or assessment that forms the basis of the relevant payment (excluding cases falling under subparagraph 5), the first proviso of the same subparagraph provides that "in cases where the national tax refund was paid in two or more installments, the next day of the last payment date" to "the next day of the national tax refund calculated retroactively in the order of national taxes."

Considering the content and structure of the relevant provisions and the fact that the additional payment on the refund of national taxes is a payment amount having the nature as a legal interest on the refund of national taxes, it is reasonable to regard the initial date of calculating the additional payment on the refund of national taxes in cases of a national tax refund accrued after payment as “the next day of the national tax payment day” pursuant to the main sentence of Article 43-3(1)1 of the Enforcement Decree of the Framework Act on National Taxes, unless the national tax was paid in two or more installments pursuant to the proviso of Article 43-3(1)1 of the Enforcement Decree of the Framework Act on National Taxes. Therefore, where the additional payment on the refund of national taxes was made after the initial return or imposition of the national tax for the same taxable period and tax item, the initial date of calculating the additional payment on the refund of national taxes shall be the next day of the national

First, in such cases, each tax amount is paid separately by a taxpayer for the initial return or imposition or for each increase and correction disposition, and it is difficult to view that it constitutes a "payment in installments" under the proviso of Article 43-3 (1) 1 of the Enforcement Decree of the Framework Act on National Taxes.

Second, in cases where a taxation disposition is revoked by a judgment or ex officio, the revocation takes effect retroactively to the time when the disposition of national tax imposition was revoked (see, e.g., Supreme Court Decisions 94Da16045, Sept. 15, 1995; 2012Da51097, Mar. 14, 2013). Thus, in cases of a national tax refund arising from partial revision or revocation of the total amount of tax after the disposition of increase or decrease, if the refund of national tax based on the grounds for revocation is specified as part of each amount of tax paid by each return or imposition, it shall be deemed that the national tax refund was retroactively accrued on each day of payment.

Third, even if a corrective disposition to increase the tax base and amount of tax is not a disposition to additionally determine only the omitted portion without having the tax base and amount of tax in the initial return or determination, but also a single tax base and amount of tax as a whole, it cannot be deemed that the substantive legal relationship with regard to payment already made in accordance with the initial return or determination is invalidated.

2. Review of the reasoning of the lower judgment and the record reveals the following facts.

A. On December 14, 2009 and February 16, 2010, the Plaintiff paid the amount of comprehensive real estate holding tax, etc. for the Plaintiff of the Defendant (the director of the competent tax office) upon imposition of the comprehensive real estate holding tax for the year 2009. On December 14, 2010 and February 15, 201, the Plaintiff reported and paid the comprehensive real estate holding tax, etc. for the year 2010.

B. Since then, on November 30, 2012, the Plaintiff paid the global real estate tax, etc. for the year 2009 and the year 2010, increased due to the Defendant’s second increase or decrease in the size of the object of taxation and the change in the type of taxation by reason of the Defendant’s second increase or decrease in the size of the object of taxation, and the amount of the global real estate tax for the year 2009, respectively, on June 13, 2014, and on June 15, 2015.

C. Supreme Court Decision 2015Du4150 (No. 2010Guhap32891 of the Seoul Administrative Court of the first instance) (No. 2010Guhap32891 of the Seoul Administrative Court) which the Plaintiff et al. filed against the director of the tax office, etc. on March 25, 2016, and on March 28, 2016, the Defendant determined the amount of property tax to be deducted when calculating the amount of comprehensive real estate tax as refund (hereinafter “instant refund”) and paid the amount and additional refund (hereinafter “instant additional refund”). At the time, the Defendant calculated the instant additional refund in order from the date following the last day of payment of comprehensive real estate holding tax for 2009 and 2010 under the proviso to Article 43-3(1)1 of the Enforcement Decree of the Framework Act on National Taxes, which was paid in excess to the Plaintiff.

3. We examine in light of the legal principles as seen earlier. The Plaintiff paid the comprehensive real estate holding tax for the year 2009 and 2010 according to the initial return or imposition disposition and the second and second adjustment disposition, and cannot be deemed to have “payment in installments.” As such, the initial date of the refund refund of this case should be the day following the payment date of each national tax pursuant to the main sentence of Article 43-3(1)1 of the Enforcement Decree of the Framework Act on National Taxes. In addition, the refund of this case was caused by the amount of each of the payments due to the first imposition and return, the first and second adjustment disposition, and the second adjustment disposition. Thus, the initial date of the additional refund should be the date following the payment date. Accordingly, the lower court should have deliberated on whether the amount claimed by the Plaintiff due to each of the payment dates of the refund of this case constitutes the amount of under-deduction of each property tax for the refund of this case and determined the amount of the additional refund refund of this case’s amount unpaid by the Defendant.

Nevertheless, solely for the reasons indicated in its holding, the lower court rejected the Plaintiff’s assertion that the amount of comprehensive real estate holding tax in the same taxable year was paid in accordance with the first disposition of imposition, or the second disposition of increase in the amount of increase in the amount of taxes, after paying or paying the comprehensive real estate holding tax in the same taxable year according to the first disposition of imposition, constitutes “where two or more installments have been paid” under the proviso of Article 43-3(1)1 of the Enforcement Decree of the Framework Act on National Taxes, and thus, the amount of the instant additional payment calculated accordingly should be calculated by applying the main sentence of Article 43-3(1)1 of the Enforcement Decree of the Framework

4. Therefore, the lower judgment is reversed, and the case is remanded to the lower court for further proceedings consistent with this Opinion. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Park Jung-hwa (Presiding Justice)