National Tax Collection Act

When the district director finds, within three years after suspending the execution of the delinquent tax collection procedure pursuant to the provisions of the items of paragraph (1) of the preceding Article, that there is no fact falling under the items of that paragraph with regard to the delinquent taxpayer concerned in the suspension, the district director must revoke the suspension of the execution.

When the district director has rescinded a stay of the execution of the delinquent tax collection procedure pursuant to the provisions of the preceding paragraph, the district director must notify the delinquent taxpayer to that effect.

If a taxpayer is delinquent in paying consumption tax, etc. (excluding consumption tax) and it is found that collection of that national tax to be imposed on the taxpayer thereafter cannot be secured, the district director may, as security for that national tax, designate an amount and a time limit and order the taxpayer to provide any of the things listed in the items of Article 50 (Types of Security) of the Act on General Rules for National Taxes.

The amount designated pursuant to the provisions of the preceding paragraph is limited to an amount equivalent to three times the amount of the national tax in question for the month preceding the month in which the provision of security is ordered (or, if that amount is less than the amount of the national tax in question for the month corresponding to the month in which the provision of security is ordered in the preceding year and for the two months following that month, that latter amount).

If the district director has ordered the provision of security for the national tax in question (excluding liquor tax) pursuant to the provisions of paragraph (1) and the taxpayer does not provide the ordered security by the designated time limit, the district director may notify the taxpayer in writing that, in relation to that national tax, a mortgage will be established, up to the amount designated pursuant to the provisions of that paragraph, on the taxpayer's property that can be the subject of a mortgage.

When the notice under the preceding paragraph has been given, the taxpayer who received the notice is deemed to have established the mortgage referred to in that paragraph. In this case, the district director must commission the relevant authority to register the establishment of the mortgage.

In the case referred to in the second sentence of the preceding paragraph (excluding the case provided for in the following paragraph), a document certifying that the document referred to in paragraph (3) has reached the taxpayer referred to in that paragraph must be attached to the document relating to the commission.

In the case referred to in the second sentence of paragraph (4), when making a commission under Article 18 (Method of Application for Registration) of the Real Property Registration Act as applied mutatis mutandis pursuant to Article 16, paragraph (2) (Registration upon Commission) of that Act (including as applied mutatis mutandis under other laws and regulations), information certifying that the document referred to in paragraph (3) has reached the taxpayer referred to in that paragraph must be provided together with the commission information. In this case, notwithstanding the provisions of Article 116, paragraph (1) (Registration upon Commission by Government Agency) of that Act, it is not necessary to obtain the consent of the person obliged to register.

If security has been provided pursuant to the provisions of paragraph (1) or a mortgage has been established pursuant to the provisions of paragraph (4) (hereinafter referred to as "provision of security, etc."), and a period during which there has been no delinquency in the national tax relating to the order referred to in paragraph (1) has continued for three consecutive months, the district director must release the security.

If the district director finds that provision of security, etc. is no longer necessary owing to a change in the financial resources or other circumstances of the taxpayer who has made the provision of security, etc., the district director may, notwithstanding the provisions of the preceding paragraph, release it immediately.

If a person found to have a tax liability has been subjected to seizure, seizure with a recording order, or retention under the provisions of Chapter XI (Investigation and Disposition of Criminal Tax Cases) of the Act on General Rules for National Taxes, or to seizure under the provisions of the Code of Criminal Procedure (Act No. 131 of 1948) (including an order to provide electronic or magnetic records under the provisions of that Act (limited to an order requiring provision by the method listed in Article 102-2, paragraph (1), item (i), (a) (Order to Provide Electronic or Magnetic Records) of that Act)), an order to provide electronic or magnetic records (limited to an order requiring provision by the method listed in (b) of that item), or arrest, on suspicion of having unlawfully evaded national tax or unlawfully received a refund of national tax, and it is found that collection of the national tax cannot be secured after the determination of the amount of the national tax to be paid in relation to the disposition (meaning determination by filing of a return, correction, or decision, and including notice of tax payment for national withholding tax as provided for in Article 2, item (ii) (Definitions) of the Act on General Rules for National Taxes; the same applies hereinafter in this Article), the district director may, before the determination of the amount of that national tax to be paid, decide the amount, out of the amount of national tax expected to be determined, for which the district director finds it necessary to execute the delinquent tax collection procedure in advance in order to secure its collection (hereinafter referred to in this Article as the "amount for preservative seizure"). In this case, a collection official may immediately seize the property of that person, up to that amount.

When the district director intends to make the decision under the preceding paragraph, the district director must obtain in advance the approval of the regional commissioner under whom the district director serves.

When deciding the amount for preservative seizure pursuant to the provisions of paragraph (1), the district director must notify the person found to have the tax liability prescribed in that paragraph of that amount for preservative seizure in writing.

If, after the notice under the preceding paragraph has been given, the person found to have the tax liability provides, as security equivalent to the amount for preservative seizure to which the notice relates, any of the things listed in the items of Article 50 (Types of Security) of the Act on General Rules for National Taxes and requests that the seizure not be made, the collection official may not make that seizure.

A collection official must release the seizure under the provisions of paragraph (1) when item (i) or item (ii) applies, and must release the security prescribed in item (iii) when that item applies:

the person subjected to the seizure under the provisions of paragraph (1) has provided the security prescribed in the preceding paragraph and requested release of the seizure;

the amount of the national tax to be paid in relation to the seizure has not been determined by the day on which one year has elapsed from the day on which the notice under paragraph (3) was given; or

the amount of the national tax to be paid in relation to the security provided for the amount for preservative seizure has not been determined by the day on which one year has elapsed from the day on which the notice under paragraph (3) was given.

A collection official may release the seizure or the security if, in relation to a person subjected to the seizure under the provisions of paragraph (1) or a person who has provided the security under paragraph (4) or item (i) of the preceding paragraph, it comes to be found, owing to a change in that person's financial resources or other circumstances, that the seizure or the taking of security is no longer necessary.

If a seizure under the provisions of paragraph (1) has been made or security under paragraph (4) or paragraph (5), item (i) has been provided, and the amount of the national tax to be paid in relation to that seizure or provision of security is then determined, that seizure or provision of security is deemed to have been made for the purpose of collecting that national tax.

Property seized pursuant to the provisions of paragraph (1) may not be realized until after the amount of the national tax to be paid in relation to the seizure has been determined.

In the case referred to in paragraph (1), if it is found that the property to be seized is insufficient, the district director may make a request for share distribution in lieu of seizure. In this case, it must be made clear that the request is a request for share distribution.

If there is money seized pursuant to the provisions of paragraph (1) (including money received from a third-party debtor, etc. through the seizure of securities, claims, or incorporeal property, etc.) and the amount of the national tax to be paid in relation to the seizure has not been determined, the district director must deposit it.

If the amount determined as the amount of the national tax to be paid, as referred to in paragraph (1), is less than the amount for preservative seizure and the person subjected to the seizure has suffered damage by the seizure, the State is liable to compensate for that damage. In this case, the amount is the amount of loss that would ordinarily arise from the seizure.