Court Opinion

ID: 9694224
Source: CourtListenerOpinion
Date Created: 2023-08-25 17:30:22.690795+00
Date Added: 2024-06-11T18:19:57.510193
License: Public Domain

RUDMAN, J.,
with whom WATHEN, C.J., and CLIFFORD, J., join, dissenting.
[¶ 18] I respectfully dissent. The first paragraph of section 706 authorizes an assessor to request taxpayers to furnish “true and perfect lists” of their property that is not tax-exempt. See 36 M.R.S.A. § 706. The fourth paragraph of section 706 provides that, after requesting “true and perfect lists,” the assessor may further require a taxpayer to “answer in writing all proper inquiries as to the nature, situation[,] and value of [the taxpayer’s] property liable to be taxed in the State _”36 M.R.S.A. § 706. I deem it significant that the Legislature first authorized an assessor to request taxpayers to provide lists of their property “not by law exempt from taxation” and later required taxpayers to answer “all proper inquiries as to the nature, situation[,] and value of ... property liable to be taxed.” 36 M.R.S.A. § 706. Merely claiming that property is tax-exempt does not necessarily make it so. An assessor is justified in requesting certain information necessary to assist the assessor in independently verifying the exempt status of such property. Therefore, an assessor may properly request information about the “nature, situation^] and value” of property that a taxpayer claims to be tax-exempt, for the purpose of independently determining whether such property is “liable to be taxed.” 36 M.R.S.A. § 706.
[¶ 19] By virtue of the provisions of section 655, “[s]tock-in-trade, including inventory held for resale by a distributor, wholesaler, retail merchant[,] or service establishment” is exempt from taxation. 36 M.R.S.A. § 655 (1990 & Supp.1998). Where equipment inventory is available for both sale and rental, only the portion in the taxpayer’s possession and held for sale on the assessment date is tax-exempt, pursuant to section 655(1)(B). See 36 M.R.S.A. § 655(1)(B); Eagle Rental, Inc. v. City of Waterville, 632 A.2d 130, 131 (Me.1993). To determine whether items of mixed sale and rental inventory are “liable to be taxed,” an assessor is justified in requesting information about items a taxpayer claims to be tax-exempt under section 655(1)(B) of Title 36. 36 M.R.S.A. § 706. Hence, where inventory consists of both sale and rental items, an assessor’s request for information about property that a tax*610payer claims is tax-exempt is a “proper inquiry,” within the meaning of section 706. See 36 M.R.S.A. § 706. Therefore, the court did not erroneously conclude that the companies failed to comply with the disclosure requirements of section 706.
[¶ 20] Sections 706 and 841 of Title 36 set forth the penalty for failure to comply with the disclosure requirements of section 706. See 36 M.R.S.A. §§ 706, 841(1) (1990 & Supp. 1998). Section 841 provides that:
The assessors ... may make such reasonable abatement as they consider proper to correct any illegality, error[,] or irregularity in assessment, provided that the taxpayer has complied with section 706. >
36 M.R.S.A. § 841(1) (emphasis added). Similarly, the third paragraph of section 706 provides that:
If notice is given by mail and the taxpayer does not furnish the list, he is'barred of his right to make application to the assessor ... or any appeal therefrom for any abatement of his taxes, unless he furnishes the list with his application and satisfies them that he was unable to furnish it at the time appointed.
36 M.R.S.A. § 706 (emphasis added). Therefore, the failure to comply with section 706 bars the companies’ declaratory judgment action in which they seek an abatement of the taxes that the assessor imposed upon them.
[¶ 21] I would affirm the judgment.