2016년 부가가치세법 판례회고

This article reviews a number of Supreme Court cases in 2016 that involve the Value-Added Tax Act. During such period, the Supreme Court produced a large number of significant judgments on various issues such as the concept and scope of supply, the determination of the place of supply, the determination of the value of supply, the distribution of purchase tax amount, and tax invoices with false information. In one of the cases, the Supreme Court held that the assignment of a supplier’s right to the payment for a supply does not transfer the liability for the supplied goods or service. The issue ultimately hinges on whether the supplier assigned its supplier status itself or only assigned its claim for the payment. In another case where a person received a deduction of input tax for a small passenger car；used the vehicle for non-business purposes；and, later, sold it to another person, the Supreme Court held that the use of the vehicle for non- business purposes is regarded as a taxable supply in itself, apart from the subsequent sale. In this case, its ruling is somewhat debatable as it effectively imposes the same tax on a single article twice. In addition, it is need to consider to increase the scope of the deduction of fictitious purchase tax amount. When multiple services rendered at different places constitute a single supply, in accordance with the Supreme Court, the place of supply is the place where the most important and essential service was rendered. A related issue is whether a value-added tax for a service should be imposed based on where the service was “provided” or “received.” As a value-added tax should be imposed where goods or a service is consumed, a value-added tax for a service should be imposed based on where the service was received. The Supreme Court seems to be taking the same stance. In another case that involves products sold through shopping channels, the Supreme Court held that the portion of a price discounted with a discount coupon is not included in the value of supply. In addition, in accordance with the Supreme Court, if an online distribution platform provider subtracts the amount discounted with discount coupons from the service fee to be received from a vendor, the discounted amount is not included in the value of supply. When a discount applies, the vendor receives a reduced amount from the consumer. The vendor does not suffer any financial loss as another payment(for example, its service fee to the platform provider) is reduced to the same extent. The Supreme Court’s ruling reaffirmed that the absence of financial loss has no bearing on the calculation of the value of supply. Moreover, it issued a highly significant en banc judgment with regard to top-up points. The gist of the judgment is that, when a price is discounted with points topped up from previous transactions, the discounted portion is not included in the value of supply. The doctrine applies even when the company/provider and the vendor exchanged payments to account for the points used. Such payment between the company/provider and the vendor is a part of the amount paid by the consumer. The value of supply should not be influenced by the money exchanged to limit its burden to the amount of the topped up points. Through a series of judgments, the Supreme Court has formed its doctrine on the distribution of input tax amount between taxable businesses and non- taxable businesses conducted by the same person. Its doctrine also found its way into relevant legislations. However, some of the Supreme Court’s judgments on this issue are questionable. Difficult issues, such as the scope of non-taxable businesses and the specific criteria for proportionate distribution, still remain. If a tax invoice contains false information, the corresponding input tax amount is not deducted. This action is justified by the fact that tax invoices form one of the foundations of the value-added tax system. However, it would not be reasonable to apply it too rigidly even when the existence of a transaction has been proven. This idea is reflected in the Supreme Court’s judgment for a related case, where it held that the input tax amount for a tax invoice issued before the time of supply may be deducted so long as the issuance date and the time of supply fall under the same taxable period. However, in another case where the supplier used another person’s name in a tax invoice, the Supreme Court held that the tax invoice is false. These interpretations should be understood as a result of the Supreme Court’s efforts to find the right balance.