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SEOUL, Nov. 13 (Korea Bizwire) — A South Korean court has ordered Incheon’s Yeonsu District Office to refund taxes to POSCO Wide, ruling that the district wrongly included the value of a golf course’s business rights in its property tax calculation.
The Incheon District Court’s Administrative Division 2 ruled in favor of POSCO Wide, which owns the Jack Nicklaus Golf Club Korea, in a lawsuit seeking to overturn the district’s refusal to return 1.64 billion won (about US$1.2 million) in acquisition-related taxes. The court also ordered the local government to cover all legal costs.
POSCO Wide acquired the Jack Nicklaus Golf Club project in July 2022 for roughly 70 billion won and paid around 14 billion won in taxes, including acquisition, education, and agricultural development levies, based on an assessed taxable value of 305 billion won.
The company later argued that 35.7 billion won attributed to the transfer of business rights should have been excluded from the tax base, as those rights are intangible assets separate from the property itself.
A view of the Jack Nicklaus Golf Club Korea (Image provided by Seoul Economic Daily Golf Magazine/Yonhap)
Yeonsu District countered that the business rights were closely tied to the real estate and thus subject to acquisition tax as an indirect cost of the purchase.
The court disagreed, finding that the golf club’s business rights were “intangible assets evaluated independently from the physical property” and that their transfer required separate legal procedures. It added that taxing the rights as part of the property value would violate the principle of legality in taxation.
Yeonsu District has filed an appeal, saying it will respond in accordance with the law while the case is under review.
Jerry M. Kim (jerry_kim@koreabizwire.com)
