【Holding】
[1] Meaning of medical and health services exempt from value-added tax under Article 26(1)5 of the former Value-Added Tax Act and Article 35 subparag. 1 of the former Enforcement Decree of the Value-Added Tax Act (= medical and health services provided in accordance with the Medical Service Act by a doctor, etc. under the Medical Service Act as the supplier), and whether medical and health services provided by a person who is not a doctor, etc. under the Medical Service Act by employing a doctor, etc. under the Medical Service Act fall thereunder (negative)
[2] Legislative purpose of Article 57(1) of the former National Health Insurance Act and whether a disposition collecting unjust enrichment under that provision is a discretionary act (affirmative) / Where a disposition collecting unjust enrichment has been made with respect to medical care benefit costs already received from the National Health Insurance Service for medical and health services provided by a person who is not a doctor, etc. under the Medical Service Act by employing a doctor, etc. under the Medical Service Act, whether such medical care benefit costs may be excluded from the tax base of value-added tax (negative, in principle), and whether the same applies even if the amount of unjust enrichment collected has actually been paid (affirmative)
[3] Meaning of the principle of substance over form in taxation under Article 14(1) of the Framework Act on National Taxes / Cases in which a person who substantially controls and manages property, rather than the person in whose name the property is held, becomes the taxpayer
[4] Legislative purpose of Article 26-2(1) of the former Framework Act on National Taxes and meaning of "fraud or other unlawful act" under Article 26-2(1)1 of the former Framework Act on National Taxes
【Summary of Decision】
[1] In light of the wording, purport, and structure of Article 26(1)5 of the former Value-Added Tax Act (before being amended by Act No. 16101, Dec. 31, 2018; hereinafter the same), Article 35 of the Enforcement Decree of the Value-Added Tax Act (before being amended by Presidential Decree No. 29535, Feb. 12, 2019; hereinafter the same), and Articles 33(2) and 87 of the former Medical Service Act (before being amended by Act No. 17069, Mar. 4, 2020), medical and health services exempt from value-added tax under Article 26(1)5 of the former Value-Added Tax Act and Article 35 subparag. 1 of the former Enforcement Decree of the Value-Added Tax Act are properly understood to mean medical and health services provided in accordance with the Medical Service Act by a doctor, etc. under the Medical Service Act as the supplier. Therefore, medical and health services provided by a person who is not a doctor, etc. under the Medical Service Act by employing a doctor, etc. under the Medical Service Act do not constitute "services provided by a doctor, etc. under the Medical Service Act," which are exempt from value-added tax under Article 26(1)5 of the former Value-Added Tax Act and Article 35 subparag. 1 of the former Enforcement Decree of the Value-Added Tax Act.
[2] Article 57(1) of the former National Health Insurance Act (before being amended by Act No. 17772, Dec. 29, 2020; hereinafter the same) provides that "The Service shall collect all or part of the amount equivalent to insurance benefits or insurance benefit costs from a person who has received insurance benefits, or a medical care institution that has received insurance benefit costs, by deceit or other unjust means," thereby expressly stating in its wording that partial collection is possible. The legislative purpose of the provision is to secure the soundness of health insurance and medical aid finances by maintaining a desirable benefit system through preventing medical care institutions from claiming benefit costs by unjust means; however, considering that the collection of unjust enrichment results in the medical care institution being unable to recover the costs of medical care benefits already provided, and thus is highly detrimental in nature, a disposition collecting unjust enrichment under Article 57(1) of the former National Health Insurance Act is properly regarded as a discretionary act.
Furthermore, in light of the legislative purpose and legal nature of a disposition collecting unjust enrichment under Article 57(1) of the former National Health Insurance Act as seen above, even if a disposition collecting unjust enrichment has been made with respect to medical care benefit costs already received from the National Health Insurance Service for medical and health services provided by a person who is not a doctor, etc. under the Medical Service Act by employing a doctor, etc. under the Medical Service Act, such medical care benefit costs should not, absent special circumstances, be excluded from the tax base of value-added tax, and the same applies even if the amount of unjust enrichment collected has actually been paid. This is because a disposition collecting unjust enrichment under Article 57(1) of the former National Health Insurance Act is a sanction made separately after the original transaction supplying medical and health services, and the amount to be collected is determined at the discretion of the National Health Insurance Service; moreover, neither the disposition itself nor the payment of the unjust enrichment collected thereunder can be regarded as retroactively nullifying the "transaction supplying medical and health services," which is subject to value-added tax, or reducing its supply value.
[3] The principle of substance over form in taxation under Article 14(1) of the Framework Act on National Taxes means that where there is a person to whom a taxable object, such as income, profits, property, or a transaction, substantively belongs, separate from the person in whose name it is held, the person who substantively owns it, rather than the nominal holder, shall be the taxpayer, without regard to form or appearance. Therefore, where the person in whose name property is held lacks the ability to control and manage it, there is a separate person who substantially controls and manages it through control over the nominal holder, etc., and such divergence between name and substance stems from the purpose of avoiding taxes, the income from the property should be regarded as belonging to the person who substantially controls and manages the property, and that person should be the taxpayer.
[4] The legislative purpose of Article 26-2(1) of the former Framework Act on National Taxes (before being amended by Act No. 16841, Dec. 31, 2019; hereinafter the same) is to set the exclusion period for the right to impose national taxes at five years in principle in order to promptly settle tax legal relationships, while extending the exclusion period for imposition of the relevant national tax to ten years where there is an unlawful act, such as making it difficult to discover facts constituting the taxation requirements for national taxes or fabricating false facts, since in such cases it is not easy for the tax authority to discover that the return omits taxable items and it is difficult to expect the exercise of the right of imposition. Accordingly, "fraud or other unlawful act" under Article 26-2(1)1 of the former Framework Act on National Taxes refers to a deceptive scheme or other unlawful affirmative act that makes the imposition and collection of taxes impossible or remarkably difficult, and merely failing to file a tax return or filing a false return under tax laws without being accompanied by any other act does not fall thereunder.
【Referenced Statutes】
[1] Article 26(1)5 of the former Value-Added Tax Act (before being amended by Act No. 16101, Dec. 31, 2018); Article 35 of the Enforcement Decree of the Value-Added Tax Act (before being amended by Presidential Decree No. 29535, Feb. 12, 2019); Articles 33(2) and 87 of the former Medical Service Act (before being amended by Act No. 17069, Mar. 4, 2020) [2] Article 57(1) of the former National Health Insurance Act (before being amended by Act No. 17772, Dec. 29, 2020) [3] Article 14(1) of the Framework Act on National Taxes [4] Article 26-2(1) of the former Framework Act on National Taxes (before being amended by Act No. 16841, Dec. 31, 2019) (see current Article 26-2(1) and (2))
【Referenced Precedents】
[1] Supreme Court Decision 2011Du5834, May 9, 2013 (Gong2013Sang, 1045)
[2] Supreme Court Decision 2015Du39996, June 4, 2020 (Gong2020Ha, 1367)
Supreme Court Decision 2018Du44838, July 9, 2020 (Gong2020Ha, 1609)
[3] Supreme Court en banc Decision 2008Du8499, January 19, 2012 (Gong2012Sang, 359)
Supreme Court Decision 2014Do9026, November 9, 2018 (Gong2019Sang, 81)
[4] Supreme Court Decision 2013Du7667, December 12, 2013 (Gong2014Sang, 196)
(Source: Supreme Court Decision 2026Du30111, July 16, 2026 | Judicial Information Disclosure Portal, Precedents)
2026. 10. 14. · By Attorney Dongwoo Shin
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