A petition seeking to overturn court rulings that upheld a local tax levied on a disability activity support agency has passed the Constitutional Court's preliminary screening.
The Constitutional Court said on the 9th that a three-justice panel referred the case, filed by an agency identified as A, to the full bench.
Agency A, an unincorporated association that dispatches personal assistants and provides peer counseling, has operated an activity support agency under the Act on Support for Persons with Disabilities. The Jongno District Office determined that the agency did not qualify as a social welfare corporation eligible for a local tax exemption between January 2020 and January 2022, and imposed 25 separate levies of the employee-based local tax totaling about 40 million won, along with penalty taxes.
Disability activity support agencies had been exempt from the employee-based local tax, but a January 2020 revision to the Restriction of Special Local Taxation Act created a legal basis for taxing them. The government revised the law again in March 2023 to exempt the employee-based local tax from that point onward.
Agency A filed a suit to cancel the tax assessment. The suit was dismissed in the first and second trials, and the Supreme Court ruled against the agency in May this year. The agency then filed a constitutional petition with the Constitutional Court seeking to overturn the first-instance, appellate and Supreme Court rulings. The agency argued that the rulings, by finding the local tax assessment lawful under statutory provisions that violate the constitutional principle of tax equality, run counter to the principle of substantive taxation, the social state principle, the duty to protect persons with disabilities and the principle of proportionality, and infringe on basic rights including the right to equality and property rights.
Since the introduction of constitutional petitions against court rulings, 19 cases have been referred to the full bench. Of the 2,126 such petitions filed as of the previous day, 1,973 were dismissed.
