This study does economic analysis on the redemption of the imported oil tax refund from the Board of Audit and Inspection of Korea (“BAI” hereafter) based on scientific research on oil production process. Oil companies insist that hydrogen gas, which is produced in oil chemical process of dissolving naphtha, reused in oil refinery process should be considered in calculating the imported oil tax refund. From the viewpoint of managerial accounting, oil companies regard hydrogen gas as a mere wastage of a direct material. However, considering that hydrogen gas is a high-grade energy resource which can’t be produced easily, the BAI’s insistence that hydrogen gas is a byproduct of naphtha is rather more technically feasible. Nonetheless, from the viewpoint of accounting materiality, the insignificant effect of the reused hydrogen gas on the financial performance of oil companies opens the possibility for legal controversy over the characteristics of hydrogen gas in impending lawsuit. Furthermore, from viewpoint of cost planning, oil companies’ accounting decision, despite the guaranteed big imported oil tax refund, is based on bounded rational expectation of the BAI’s rare inspection on their accounting procedure. Finally, from viewpoint of tax planning, although the BAI’s redemption of the imported oil tax refund could add the explicit fiscal revenue once, oil companies’ future emission of hydrogen gas to guarantee imported oil tax refund would decrease the implicit fiscal revenue via decrease in corporate tax revenue besides wasting scarce resources.