Open Decision Ledger · Tax & international taxation
When a tax transitional rule preserves former rules for trust protection
Supreme Court, Nov. 30, 2023, 2020Du41696 (judgment)
No holding summary · checked against points at issue. The official text publishes no summary of the holding for this decision. The quotation and factors in this record are copied verbatim from the points at issue; the evidence for each axis is taken from the points at issue, the order and the reasons.
Case name: 법인지방소득세경정거부처분취소
Official text on the National Law Information Center
Question
Under a transitional provision of an amended tax law that follows former provisions for local taxes already imposed or to be exempted, what must exist in the former provisions before the taxpayer may rely on them as an acquired right, and could it be used to apply the former Local Tax Act's tax base and rate to corporate local income tax for business years 2014 to 2017?
Holding
Reliance on a former tax provision protects the taxpayer only where that provision, valid at the time of the act giving rise to the tax obligation, expressly provided that the tax would be specially exempted or deferred for a limited future period even where the conditions based on that act were met. Without such express provision, the taxpayer's reliance is a mere expectation and cannot be regarded as equivalent to an acquired right. Here former Local Tax Act Article 89(1) and Article 94(1) only prescribed how the corporate income tax portion of local income tax was calculated, and the carry-forward credit laid down in Article 144(1) etc. of the former Special Tax Restructuring Act sat in a statute other than the Local Tax Act, so Supplementary Provisions (2014. 1. 1.), Article 15 could not be used to apply the former Local Tax Act's tax base and rate to corporate local income tax.
Points at issue, verbatim
‘장래의 한정된 기간 동안 조세감면 등을 명시적으로 규정한 종전의 규정’이 존재한다고 볼 수 없어 법인지방소득세에 경과규정을 근거로 구 지방세법의 과세표준 및 세율을 적용할 수 없다고 한 사례
Unofficial English translation
holding that no "prior provision explicitly providing for tax reductions or exemptions, etc. for a limited period in the future" can be regarded as existing, and that the tax base and tax rate under the former Local Tax Act cannot be applied to the corporate local income tax on the basis of the transitional provision
Disposition
Dismissed Stated in the decision
상고를 기각한다. 상고비용은 참가로 인한 부분을 포함하여 원고가 부담한다.
Unofficial English translation
The appeal is dismissed. The plaintiff shall bear the costs of the final appeal, including those incurred by the intervention.
Form of the test
Elements stated Stated in the decision
장래의 한정된 기간 동안 그 원인행위에 기초한 과세요건의 충족이 있는 경우에도 특별히 비과세 내지 면제한다거나 과세를 유예한다는 내용을 명시적으로 규정하고 있지 않는 한
Unofficial English translation
unless it is explicitly provided that the taxpayer is specially subjected to non-taxation or exempted from taxation or that taxation is deferred even where the requirements for taxation based on the causative act are satisfied for a limited period in the future
Factors
- ‘장래의 한정된 기간 동안 조세감면 등을 명시적으로 규정한 종전의 규정’이 존재한다고 볼 수 없어
- 구 조세특례제한법에 따른 법인세 세액공제 또는 이월공제 대상인 연구·인력개발비 등을
- 2014년 이후 사업연도에 이월공제를 적용하여 법인세를 신고·납부하였으나, 같은 기간의 법인지방소득세를 신고·납부할 때에는 이월공제를 적용하지 않았는데
- 경과규정인 2014. 1. 1. 개정 지방세법 부칙 제15조를 근거로 법인세 이월공제의 효과가 같은 기간 법인지방소득세에도 미친다고 주장하며
- 당초 신고·납부한 법인지방소득세액의 일부 환급을 구하는 취지의 경정청구를 하였으나, 관할 구청장이 이를 거부한 사안에서
Unofficial English translation
• no "prior provision explicitly providing for tax reductions or exemptions, etc. for a limited period in the future" can be regarded as existing
• research and human resource development expenses, etc. eligible for a corporate tax credit or a carryforward credit under the former Restriction on Special Taxation Act,
• filed and paid corporate tax by applying a carryforward credit for business years after 2014, but did not apply the carryforward credit when filing and paying the corporate local income tax for the same period;
• asserting, on the basis of Article 15 of the supplementary provisions to the Local Tax Act amended on January 1, 2014, which is a transitional provision, that the effect of the corporate tax carryforward credit extended to the corporate local income tax for the same period;
• filed an application for a corrected assessment seeking a partial refund of the corporate local income tax originally filed and paid, which the competent ward office head refused in this case
Relation to precedent
Follows earlier decisions Stated in the decision
대법원 2001. 5. 29. 선고 98두13713 판결(공2001하, 1523), 대법원 2013. 9. 12. 선고 2012두12662 판결(공2013하, 1835)
Unofficial English translation
Supreme Court Decision 98Du13713 decided May 29, 2001 (Gong 2001 Ha, 1523); Supreme Court Decision 2012Du12662 decided September 12, 2013 (Gong 2013 Ha, 1835)
Decisions referred to
[1] 대법원 2001. 5. 29. 선고 98두13713 판결(공2001하, 1523), 대법원 2013. 9. 12. 선고 2012두12662 판결(공2013하, 1835)
Burden of proof
Not addressed Not in the decision
Open question and revisit condition
Where the former provision expressly defers taxation but the taxpayer instead relied on a tax reduction in another statute, how is the protection of that reliance to be weighed?
A later decision revising the test for trust protection against a transitional provision of an amended tax law, or a decision distinguishing the corporate income tax portion of local income tax from corporate local income tax, would require this entry to be read again. Any amendment to Supplementary Provisions (2014. 1. 1.), Article 15 or to the former provisions on the corporate income tax portion of local income tax would also change the record.
Cross-family AI independent reading & axis check
6 of 8 axes matched GPT-6 Astra (OpenAI, codex CLI) · 2026-10-25
A reader from another model family (GPT-6 Astra), given the official text but not the primary reading, agreed on 6 of the 8 axes; the readings differed on axis 4 (form of the test), axis 8 (open question and revisit condition).
Axis 4 (Form of the test): Primary “Elements stated” vs Independent “Existing test applied”
The primary reading states the general requirement for relying on a former provision, while the independent reading applies that requirement to the facts of this case.
‘장래의 한정된 기간 동안 조세감면 등을 명시적으로 규정한 종전의 규정’이 존재한다고 볼 수 없어 법인지방소득세에 경과규정을 근거로 구 지방세법의 과세표준 및 세율을 적용할 수 없다고 한 사례Axis 8 (Open question and revisit condition): Primary “Where the former provision expressly defers taxation but the taxpayer instead relied on a tax reduction in another statute, how is the protection of that reliance to be weighed?” vs Independent “What statutory wording would qualify as an express grant of local tax relief for a limited future period under this transitional provision?”
The primary reading asks how to weigh reliance where the former rule expressly defers tax but the taxpayer relied on a reduction in another statute, while the independent reading asks what wording would count as an express grant.
‘장래의 한정된 기간 동안 조세감면 등을 명시적으로 규정한 종전의 규정’이 존재한다고 볼 수 없어 법인지방소득세에 경과규정을 근거로 구 지방세법의 과세표준 및 세율을 적용할 수 없다고 한 사례Raw responses and comparison record: Protocol · Blind readings (JSONL) · Axis comparison (JSONL) · SHA-256 (JSON)
Lower-court contrast & scope of application
Lower-court reading vs. Supreme Court holding
Lower-court context: The Daejeon High Court, Cheongju Division, in its judgment of 27 May 2020 (2019Nu1679), held that former Local Tax Act Article 89(1) and Article 94(1) only prescribed how the corporate income tax portion of local income tax was calculated and did not directly prescribe tax reductions for that tax. It also held that the carry-forward credit for research and development expenses under the former Special Tax Restructuring Act was provided in a statute other than the Local Tax Act, so those provisions were not former provisions expressly prescribing a tax reduction for a limited future period, and refused to apply the former Local Tax Act's tax base and rate by way of the transitional rule.
Supreme Court standard: The Supreme Court found no error. It held that the reasons of the judgment below, read against the governing rule and the record, were sound, and that there was no misapprehension of the rule on the interpretation of the transitional provision that affected the outcome. The Justices unanimously dismissed the appeal.
Distinguishing conditions
- A former provision that expressly provided, for a limited future period, that the tax would be specially exempted or deferred even where the conditions based on the cause act were met.
- A former provision that itself prescribed a tax reduction for the local tax at issue, rather than only the calculation of that tax.
- A tax governed by a transitional provision whose subject is not a local tax actually imposed or to be exempted under former provisions at the time the amended Act took effect.
Record verification notes
Set the provision the taxpayer relies on against the two points the Court required: whether it expressly provided for exemption or deferral for a limited future period, and whether it was a provision of the Local Tax Act itself. Also check Supplementary Provisions (2014. 1. 1.), Article 2, the proviso, under which corporate local income tax applies only from the first tax period beginning after the Act took effect, since that fixes which business years the transitional rule could reach at all.
From the official text
Points at issue
[1] 개정된 세법 부칙조항을 근거로 납세의무자의 기득권 내지 신뢰보호를 위하여 납세의무자에게 유리한 종전 규정을 적용하기 위한 요건 [2] 갑 주식회사가 2014. 1. 1. 지방세법 개정 전에 지출한 구 조세특례제한법에 따른 법인세 세액공제 또는 이월공제 대상인 연구·인력개발비 등을 2014년 이후 사업연도에 이월공제를 적용하여 법인세를 신고·납부하였으나, 같은 기간의 법인지방소득세를 신고·납부할 때에는 이월공제를 적용하지 않았는데, 갑 회사가 경과규정인 2014. 1. 1. 개정 지방세법 부칙 제15조를 근거로 법인세 이월공제의 효과가 같은 기간 법인지방소득세에도 미친다고 주장하며, 당초 신고·납부한 법인지방소득세액의 일부 환급을 구하는 취지의 경정청구를 하였으나, 관할 구청장이 이를 거부한 사안에서, ‘장래의 한정된 기간 동안 조세감면 등을 명시적으로 규정한 종전의 규정’이 존재한다고 볼 수 없어 법인지방소득세에 경과규정을 근거로 구 지방세법의 과세표준 및 세율을 적용할 수 없다고 한 사례
Unofficial English translation
[1] Requirements for applying prior provisions favorable to a taxpayer in reliance on the taxpayer's vested rights or protection of legitimate expectations, based on the supplementary provisions of the amended tax statutes [2] In a case where Company A, having incurred research and human resource development expenses before January 1, 2014, when the Local Tax Act was amended, that were eligible for a corporate tax credit or a carryforward credit under the former Restriction on Special Taxation Act, filed and paid corporate tax by applying a carryforward credit for business years after 2014, but did not apply the carryforward credit when filing and paying the corporate local income tax for the same period; and Company A asserted, on the basis of Article 15 of the supplementary provisions to the Local Tax Act amended on January 1, 2014, which is a transitional provision, that the effect of the corporate tax carryforward credit extended to the corporate local income tax for the same period, and filed an application for a corrected assessment seeking a partial refund of the corporate local income tax originally filed and paid, which the competent ward office head refused; holding that no "prior provision explicitly providing for tax reductions or exemptions, etc. for a limited period in the future" can be regarded as existing, and that the tax base and tax rate under the former Local Tax Act cannot be applied to the corporate local income tax on the basis of the transitional provision
Summary of the holding
The official text publishes no summary of the holding for this decision. The quotation and factors in this record are copied verbatim from the points at issue; the evidence for each axis is taken from the points at issue, the order and the reasons.
Order
상고를 기각한다. 상고비용은 참가로 인한 부분을 포함하여 원고가 부담한다.
Unofficial English translation
The appeal is dismissed. The plaintiff shall bear the costs of the final appeal, including those incurred by the intervention.
Provisions referred to
[1] 지방세법 부칙(2014. 1. 1.) 제15조 [2] 구 지방세법(2014. 1. 1. 법률 제12153호로 개정되기 전의 것) 제89조 제1항(현행 제103조의20 참조), 제94조 제1항(현행 제103조의21 참조), 지방세법 부칙(2014. 1. 1.) 제1조, 제2조, 제15조, 구 조세특례제한법(2010. 12. 27. 법률 제10406호로 개정되기 전의 것) 제26조, 제144조 제1항, 구 조세특례제한법(2014. 1. 1. 법률 제12173호로 개정되기 전의 것) 제10조, 제11조(현행 제10조의2 참조), 제24조, 제25조의3(현행 제24조 참조), 제26조, 제144조 제1항
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