MODIFICATION AND EXEMPTION OF VALUE-ADDED TAX ETC. FOR PETROLEUM PRODUCTS FOR AGRICULTURE, FORESTRY, FISHERIES AND COASTAL PASSENGER SHIPS

If a petroleum retailer designated by Presidential Decree, such as a gas station (hereinafter referred to as "petroleum retailer" in this Article), receives petroleum products on which value-added tax, excise tax, traffic, energy and environment tax, education tax, and automobile tax have been levied, and supplies them to farmers, etc., and if the supplied petroleum products fall under any of the subparagraphs of paragraph (1), the petroleum retailer may apply for a refund of the exempted tax amount or deduct it from the tax amount to be paid or collected, according to Presidential Decree. <Amended by Act No. 11786, May 19, 2011, Act No. 11604, Dec. 31, 2011>

To receive tax-exempt oil, farmers, etc. shall obtain a tax-exempt oil purchase card or release order (hereinafter referred to as "tax-exempt oil purchase card, etc." in this Article) designated by Presidential Decree from the cooperatives managing tax-exempt oil.

The cooperatives managing tax-exempt oil shall issue tax-exempt oil purchase cards, etc. considering the holdings of agricultural machinery, etc., and the scale of farming, forestry, or fishing management of farmers, etc.

The central federations managing tax-exempt oil and the cooperatives managing tax-exempt oil (hereinafter referred to as "tax-exempt oil management institutions" in this Article) may disclose the details of the supply of tax-exempt oil to farmers, etc. on the website of the tax-exempt oil management institutions.

If farmers, etc. fall under any of the following subparagraphs, those farmers, etc. (including their spouses and direct lineal ascendants and descendants who live together and engage in joint production activities with them) shall be prohibited from using tax-exempt oil for two years from the date the tax-exempt oil management institution becomes aware of the fact (one year in the case of subparagraph 3, and until the date of payment of the recovery tax amount under paragraph (9) in the case of subparagraph 4, if the recovery tax amount is not paid by the date after two years). However, in cases of natural disasters or other reasons designated by Presidential Decree, if the change report under paragraph (3) cannot be made or the documents under paragraph (5) 1 (b) and paragraph (2) of the same paragraph cannot be submitted by the final submission deadline, tax-exempt oil may be used according to Presidential Decree. <Amended by Act No. 10836, Dec. 27, 2010, Act No. 12962, Dec. 23, 2014, Act No. 17720, Dec. 31, 2019, Act No. 17350, Jun. 9, 2020> 1. If the report under paragraph (3) is made falsely or by other improper means, or if the change report is not made. 2. If the tax-exempt oil purchase card, etc. issued under paragraph (4) or the petroleum products supplied with the tax-exempt oil purchase card, etc. are transferred to another person. 3. If the documents under paragraph (5) 1 (b) and paragraph (2) of the same paragraph are not submitted or are submitted falsely by the final submission deadline. 4. If a reason for recovery of the tax reduction and exemption amount under paragraph (9) occurs.

If a person not belonging to farmers, etc. obtains a tax-exempt oil purchase card, etc. under paragraph (4), or if farmers, etc. or persons not belonging to farmers, etc. acquire a tax-exempt oil purchase card, etc. or petroleum products supplied with the tax-exempt oil purchase card, etc. from farmers, etc., or if the refunded or deducted tax amount applied for by a petroleum retailer under paragraph (2) exceeds the refundable or deductible tax amount that should have been applied for, the amount calculated according to the following subparagraphs shall be recovered, according to Presidential Decree. <Amended by Act No. 10836, Dec. 27, 2010, Act No. 11604, Dec. 31, 2011, Act No. 17720, Dec. 31, 2019> 1. In the case of obtaining a tax-exempt oil purchase card, etc. from a cooperative managing tax-exempt oil or acquiring a tax-exempt oil purchase card, etc. from farmers, etc., the sum of the amounts calculated as follows: a. The amount equivalent to the tax reduction and exemption of value-added tax, excise tax, traffic, energy and environment tax, education tax, and automobile tax when petroleum products are supplied with the tax-exempt oil purchase card, etc. at the time of issuance or acquisition. b. A surtax equivalent to 40/100 of the amount equivalent to the tax reduction and exemption under item a. 2. In the case of acquiring petroleum products supplied with a tax-exempt oil purchase card, etc. from farmers, etc., the sum of the amounts calculated as follows: a. The amount of tax reduction and exemption for value-added tax, excise tax, traffic, energy and environment tax, education tax, and automobile tax on the relevant petroleum products. b. A surtax equivalent to 40/100 of the tax reduction and exemption amount under item a. 3. In the case where the refunded or deducted tax amount applied for by a petroleum retailer under paragraph (2) exceeds the refundable or deductible tax amount that should have been applied for, the sum of the amounts calculated as follows. However, item b shall apply only in cases of improper application. a. The amount of tax reduction and exemption for value-added tax, excise tax, traffic, energy and environment tax, education tax, and automobile tax on the relevant petroleum products. b. A surtax equivalent to 40/100 of the tax reduction and exemption amount under item a.

Paragraph (13) shall also apply to persons related to a petroleum retailer for whom a reason for recovery of the tax reduction and exemption amount under paragraph (12) has occurred, as specified in the following subparagraphs. However, this shall not apply if the acquirer (excluding persons with a special relationship with the petroleum retailer designated by Presidential Decree) or the corporation proves that they were unaware of the occurrence of the reason for recovery of the tax reduction and exemption amount of the former petroleum retailer. <Amended by Act No. 12962, Dec. 23, 2014> 1. In case of death of a petroleum retailer: The heir. 2. In case of transfer of all petroleum retail business: The acquirer. 3. In case of merger of a corporate petroleum retailer with another petroleum retailer: The surviving corporation or the corporation established by the merger.

The central federations managing tax-exempt oil shall manage the issuance and use of tax-exempt oil purchase cards, etc. within the scope of the annual quota for petroleum products under paragraph (15) (hereinafter referred to as "tax-exempt oil quota" in this paragraph). If tax-exempt oil purchase cards, etc. are issued exceeding the tax-exempt oil quota and petroleum products under paragraph (1) 1 are supplied, the tax reduction and exemption amount for value-added tax, excise tax, traffic, energy and environment tax, education tax, and automobile tax shall be recovered from the central federations managing tax-exempt oil, as if they had received the supply, according to Presidential Decree. <Amended by Act No. 11604, Dec. 31, 2011, Act No. 17720, Dec. 31, 2019>

When the cooperatives managing tax-exempt oil become aware of the occurrence of reasons for recovery of tax reduction and exemption amounts or surtaxes under paragraphs (9), (11), and (12), or when farmers, etc. are imposed an alternative fine to suspension or closure of fishing operations, etc. under the "Fisheries Act" and related laws, they shall immediately suspend the issuance and use of tax-exempt oil purchase cards, etc. and promptly notify the competent tax office of the fact. <Amended by Act No. 13721, Dec. 15, 2015>

To efficiently perform tax-exempt oil management tasks, tax-exempt oil management institutions may request the following data from administrative agencies, etc. The administrative agencies, etc. that receive the request shall provide the requested data to the tax-exempt oil management institutions, unless there is a justifiable reason. <Amended by Act No. 12962, Dec. 23, 2014, Act No. 17720, Dec. 31, 2019> 1. Data concerning death of farmers, etc. under Article 9 of the "Act on the Registration and Management of Family Relations." 2. Data concerning change of address reports of farmers, etc. under Article 16 of the "Resident Registration Act." 3. Data related to the vessel position of vessel location transmitters under Article 5-2 of the "Fishing Vessel Act." 4. Data concerning payment status of recovery tax amount under paragraph (9). 5. Computerized data of cargo vehicles owned by farmers, etc. under Article 69 of the "Motor Vehicle Management Act" (data related to initial registration, transfer registration, change registration, and cancellation registration of vehicles, including vehicle registration numbers, owner's name, and resident registration numbers).

Matters necessary for the procedures for supply and management of tax-exempt oil, issuance and use of tax-exempt oil purchase cards, etc., and recovery of tax reduction and exemption amounts, amounts equivalent to tax reduction and exemption, and surtaxes under paragraphs (1) through (20) shall be prescribed by Presidential Decree. <Amended by Act No. 15983, Dec. 24, 2018, Act No. 18650, Dec. 28, 2021>