National Tax Service Review and Transfer 2011-0218 (Law No. 279, 2011)

It is difficult to recognize that previous farmland has been cultivated directly for not less than three years.

It is difficult to recognize that the previous farmland was cultivated directly for not less than three years in light of the fact that he/she held office as the representative of a corporation and received benefits during the previous farmland retention period, that a resident near the farmland farmland has cultivated by a third party to a tax official who had conducted a field investigation, and that the plaintiff himself/herself was a third party who used the agricultural machinery.

Article 70 of the Restriction of Special Taxation Act

2011Revocation of disposition of revocation of imposition of capital gains tax, etc.

XX Kim

Daejeon director of the tax office

September 19, 2012

October 31, 2012

1. Of the instant lawsuit, the part of the instant lawsuit seeking revocation of the imposition disposition of KRW 000,000 against the Plaintiff on June 13, 2011 by the Defendant is dismissed.

2. The plaintiff's remaining claims are dismissed.

3. The costs of lawsuit shall be borne by the Plaintiff.

The Defendant’s disposition of imposition of capital gains tax of KRW 000 and local income tax of KRW 000 against the Plaintiff on June 13, 2011 is revoked.

1. Details of the disposition;

A. On August 9, 2004, the Plaintiff (hereinafter referred to as “instant land”) on December 30, 2009, transferred the land of this case to the Korea Land and Housing Corporation (hereinafter referred to as “the instant land”) on December 30, 2009, Seosung-dong, Daejeon-dong 00-21, 1323 square meters (hereinafter referred to as “instant land”) acquired from EA, EB, or ECC, and thereafter newly acquired the land of this case on March 9, 201.

B. On February 25, 2010, the Plaintiff filed an application for reduction or exemption of capital gains tax due to substitute farmland for farmland pursuant to Article 70 of the Restriction of Special Taxation Act (amended by Act No. 9921, Jan. 1, 2010; hereinafter the same shall apply) and Article 67 of the Enforcement Decree of the same Act (amended by Presidential Decree No. 22037, Feb. 18, 2010; hereinafter the same shall apply) on the ground that the instant land constitutes farmland of which the pertinent land was self-fluenced for three or more years, upon filing a preliminary return

C. The Defendant: (a) deemed that it is difficult for the Plaintiff to regard the instant land as the Plaintiff did not satisfy the requirements for reduction and exemption of capital gains tax under the said provision; (b) rendered a disposition of KRW 000 on June 13, 201, imposing capital gains tax on the Plaintiff for the year 2009; and (c) imposed a disposition of KRW 000 on the same day.

D. On August 12, 201, the Plaintiff dissatisfied with the disposition imposing capital gains tax, filed a request for review with the National Tax Service on August 12, 201, but was dismissed on September 29, 2011.

[Ground of recognition] Facts without dispute, Gap evidence Nos. 1 through 3 (including branch numbers; hereinafter the same shall apply), Eul evidence No. 1, the purport of the whole pleadings

2. Whether the lawsuit regarding the claim for revocation of imposition of local income tax among the lawsuit of this case is legitimate

Although the Plaintiff seeks revocation of the imposition disposition of local income tax against the Defendant, according to Article 93(1), (2), and (5) of Chapter 8 of the former Local Tax Act (amended by Act No. 11108, Dec. 2, 2011), local income tax pro rata is a local tax that should be paid to the head of the local government having jurisdiction over the place of payment of income tax. If the head of the tax office collects income tax by the method of imposition and notice according to the correction, determination, etc. under the Framework Act on National Taxes or the Income Tax Act, it appears that the head of the local government concerned imposes and notifies it. Thus, the Defendant of the appeal suit seeking revocation of the imposition disposition shall be the head of the local government having jurisdiction over the place of payment of income tax (see Supreme Court Decision 2004Du1459, Feb. 25, 2005). Therefore, this part of the lawsuit is unlawful as it is against the

3. Whether the disposition of transfer income tax of this case is legitimate

A. The plaintiff's assertion

The Plaintiff was directly cultivated in the land of this case, such as worship, drilling, drilling, drilling, strike, etc. As such, the disposition imposing the transfer income tax of this case (hereinafter referred to as the “disposition of this case”) on the premise that the Plaintiff did not own the land of this case is unlawful.

B. Relevant statutes

The entries in the attached Table-related statutes are as follows.

C. Determination

Article 70(1) of the Restriction of Special Taxation Act and Article 67(1) of the Enforcement Decree of the same Act stipulate that "direct cultivation of farmland by a person who has resided in a location of farmland for not less than three years shall be subject to reduction of 100% of transfer income tax on income accruing from the substitution of farmland into another farmland for the purpose of cultivation." Article 67(2) of the same Enforcement Decree provides that "direct cultivation" refers to the cultivation of farmland on its own land at all times or the cultivation of perennial plants with 1/2 or more of farming work on its own labor. It is reasonable to interpret or analogical interpretation of these provisions as favorable to taxpayers without any justifiable reason results contrary to the principle of fair taxation, which is the basic ideology of the tax law, so the principle of strict interpretation derived from the principle of no taxation without law should be applied (see, e.g., Supreme Court Decisions 2001Du731, Apr. 12, 2002; 2005Du93194, Mar. 19, 2005).

As to the instant case, the following circumstances, which are acknowledged by comprehensively taking account of the overall purport of pleadings as follows, including the health stand, Eul evidence Nos. 2, 3 through 5, and 10, witness D’s testimony, ① the Plaintiff was in office as the representative of OE corporation during the period of possession of the instant land, KRW 00 won in 2006, KRW 00 in 207, KRW 000 in 208, and KRW 000 in 209, KRW 200 in 200, KRW 30 in 200, and 300 in 209. The Plaintiff’s assertion that there was no other evidence to acknowledge that the Plaintiff had been in fact in the farming field of the instant case’s land for which he had been in possession of the instant land, was in possession of the Plaintiff’s farmland for 10 or more years, and that there was no other evidence to acknowledge that the Plaintiff had been in possession of the instant farmland for 206 to 209.

4. Conclusion

Therefore, among the plaintiff's lawsuit of this case, the part against the defendant seeking revocation of imposition of local income tax against the defendant is unlawful and dismissed. The plaintiff's remaining claims are dismissed as it is without merit. It is so decided as per Disposition.