The Korean Red Cross filed a lawsuit requesting an exemption from property taxes like a social welfare corporation, but it was not accepted by the court.
According to the legal community on the 9th, the Administrative 8th Division of the Seoul Administrative Court (Director General Lee Jung-hee) ruled against the Korean Red Cross in a lawsuit concerning the cancellation of property tax imposed on 42 people, including the head of the Jung-gu District Office in Seoul, filed last November.
Previously, 42 local governments, including Jung-gu and Gwanak-gu in Seoul, imposed 1.359 billion won in property tax and local government tax on real estate owned by the Korean Red Cross in 2022. The Local Tax Special Case Limitation Act states that 'properties used directly for businesses other than medical services are eligible for a 25% property tax reduction.' Accordingly, the amount reduced by 25% was imposed as property tax.
The Korean Red Cross stated that it should be subject to Article 22, Paragraph 2 of the Local Tax Special Case Limitation Act, which says that 'social welfare corporations, etc., are exempt from property taxes for real estate used directly for social welfare activities,' and filed a lawsuit to cancel the property tax.
The Korean Red Cross is a non-profit organization established under the Korean Red Cross Organization Act and is not a social welfare corporation. However, it argues that it should be eligible for property tax exemption provisions since it conducts relief and social welfare activities for people affected by major disasters such as floods, fires, famines, and infectious diseases.
However, the court did not accept the claims of the Korean Red Cross, stating that the Local Tax Special Case Limitation Act, revised in January 2020, defines the types of social welfare activities restrictively. The court found that "if interpreted as the plaintiff argues, it should be understood that a non-profit organization conducting social welfare activities is exempt from property taxes on the corresponding real estate, which does not align with the intention of the legislator."