KUMAMOTO – The Kumamoto District Court on Thursday rejected a demand by a group working on behalf of Japanese abducted by North Korea that the Kumamoto Municipal Government halt tax benefits enjoyed by a pro-North Korea organization’s facility here.
The city has said the tax breaks apply to the Kumamoto Korean hall owned by the General Association of Korean Residents in Japan (Chongryun) because it serves as a public facility for ethnic Korean residents. The court agreed.
It was the first court decision on whether Chongryun’s properties should be subject to local taxes.
The plaintiffs, members of the Kumamoto chapter of the National Association for the Rescue of Japanese Kidnapped by North Korea (NARKN), immediately appealed the ruling to the Fukuoka High Court.
Similar suits have been filed nationwide and citizens have asked auditors to determine the validity of giving preferential treatment to the group.
A number of local governments have exempted or reduced taxes for properties owned by Chongryun because of its perceived function as a de facto diplomatic mission. Japan and North Korea do not have diplomatic ties.
But some localities have reversed their policies and started imposing full taxes on the properties, particularly after North Korea admitted in September 2002 that its agents abducted 13 Japanese in the 1970s and 1980s.
The NARKIN members filed the lawsuit in January 2004 against Kumamoto Mayor Seishi Koyama, demanding that past reduced taxes be recovered and that the mayor put an end to the preferential treatment.
The city has reduced the fixed-asset and urban-planning taxes for the hall, saying it is equivalent to a public facility because it is used for community exchanges.
It said it exempted Chongryun from paying 267,100 yen of the 303,400 yen fixed-asset tax and 38,200 yen of the 43,300 yen urban planning tax for fiscal 2003.
The plaintiffs said the hall was not public in nature. They claimed Chongryun is engaged in profit-making and political activities, and asserted Koyama should not grant special privileges to certain residents at his discretion without legal grounds.
NARKN members said the city was violating the local tax law and the Constitution’s provision that “all of the people are equal under the law” by partially exempting taxes for the Chongryun facility.
But the city responded that the Korean hall is used by Korean residents of Japan for cultural activities, counseling and passports issuance, making it public in nature.
In November 2003, the city’s auditors urged the Kumamoto mayor to impose full taxes on the facility after NARKN asked the auditors to push for such an outcome.
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