Case Overview
Since 2020, the National Tax Service (NTS) has implemented the “Small Building Appraisal Project” to enhance fairness in inheritance and gift taxation. Under this initiative, the NTS conducted retroactive appraisals on properties for which inheritance tax had already been properly reported and paid, resulting in additional tax assessments. Many taxpayers challenged these assessments in court, but legal precedents were unclear and inconsistent.
Our Strategy

• Key Issues Raised: Challenged the constitutionality and legality of Article 49(1) proviso of the Enforcement Decree of the Inheritance and Gift Tax Act.
• Legal Argument: Asserted that the provision violated the principle of tax legality and the hierarchy of laws under the Constitution.
• Evidence: Demonstrated, with concrete data, the absence of any “special circumstances” justifying retroactive appraisal.

• Court ruled that the proviso of Article 49(1) of the Enforcement Decree was unconstitutional and unlawful – a first-of-its-kind decision.
• NTS’s retroactive appraisal could not be recognized as market value; inheritance tax assessment of approximately KRW 10 billion was canceled and refunded.
• Established a legal basis for challenging similar assessments under the NTS appraisal project.