Court Opinion

ID: 9718549
Source: CourtListenerOpinion
Date Created: 2023-08-26 07:27:02.140376+00
Date Added: 2024-06-11T18:24:00.328109
License: Public Domain

CLIFFORD, Justice,
dissenting.
Because, in my view, the Assessor’s construction giving different meanings to the words “the taxpayer” within the apportionment statute is contrary to the plain language of the statute and is inconsistent with the unitary business concept pursuant to which Maine’s income tax scheme operates, I respectfully dissent.
The Uniform Division of Income for Tax Purposes Act, 36 M.R.SA §§ 5210-5211 (1990 & Supp.1995), operates to apportion the income of businesses that generate income within Maine and other states so that the income taxed by Maine is attributable to Maine activity. Id. § 5211; see Tambrands, Inc. v. State Tax Assessor, 595 A.2d 1039, 1040-41 (Me.1991). GNN is a unitary business, see 36 M.R.SA § 5102(10-A) (1990), comprised of ten affiliated corporations, and is required to file income tax returns as a unitary business and report the combined income of its affiliates.
36 M.R.SA § 5244 (1990) requires the reporting of all property, payroll, and sales of the entire unitary business so that those factors may be used in the formula to apportion to this state the income of the unitary business that is attributable to Maine activity.9 Section 5211 provides for the apportionment of the property, payroll, and sales factors of “the taxpayer.” The Superior Court correctly concluded that the term “the taxpayer,” whenever it is used throughout section 5211, means the entire unitary business group.10
The Assessor does not dispute that, within section 5211, “the taxpayer” is treated as the entire unitary group for purposes of the denominator of the property, payroll, and sales factor formula. According to the Assessor’s construction of the statute that this Court adopts, however, “the taxpayer,” as defined in sections 5211(14) and (15)(B)11 (dealing with the sales factor numerator in the apportionment formula) has a different meaning; for those purposes, the meaning of “the taxpayer” is limited to only those corporations in the unitary business that have a Maine nexus.12
In my view, assigning different meanings to “the taxpayer” within the same section of a statute does not comport with common sense or with the rules of statutory construc*968tion. Identical words in different parts of the same statute are presumed to have the same meaning. Sullivan v. Stroop, 496 U.S. 478, 484, 110 S.Ct. 2499, 2503, 110 L.Ed.2d 438 (1990). So much more so for identical words in the same section. Had the Legislature intended the same words to have different meanings within the same statutory provision, it could have stated that intention. Moreover, a statute must be read in its entirety, so that a harmonious result intended by the Legislature can be reached. Delano v. City of S. Portland, 405 A.2d 222, 227 (Me.1979); In re Belgrade Shores, Inc., 359 A.2d 59, 61 (Me.1976). Had the Legislature intended the same words to have different meanings within the same statutory provision, it could have stated that intention.
The Assessor’s construction impermissibly is skewed to increase the amount of taxes realized at the expense of comporting with the unitary business concept. Pursuant to that concept, Maine taxes income of corporations that do business across state lines by apportioning the income of the entire unitary business to determine what part of the income is attributable to Maine. The Assessor’s construction attributes to Maine business activity that is not truly related to this state, i.e., sales in other states. The Superi- or Court correctly analyzed the issue:
Under the unitary business concept, the income of a functionally integrated business enterprise is aggregated and then apportioned to reflect the amount of income of the entire unitary business that is attributable to Maine. The income is apportioned among Maine and other states in which the unitary business operates based on the relative level of property, payroll and sales of the unitary business in those states. Property, payroll and sales are thought to be reliable indicators of the level of business activity of the unitary business.
The Assessor’s interpretation of the apportionment provisions follows the unitary business principle in all respects except when applying the throwback rule.
In so doing, the Assessor undermines the function of Maine’s combined reporting/formula apportionment method of taxation by reducing the accuracy and reliability of the sales factor as a measure of the business activity of a unitary business. Sales by the unitary business that actually occurred in other states are counted as Maine sales.
(Citations omitted.)
Even though the language of section 5211 was enacted when UDITPA dealt only with a single taxpayer, on the subsequent enactment of section 5244 and the adoption of the unitary combined reporting, UDITPA became applicable to all members of the unitary business group, and the language of section 5244 implicitly was amended so that “the taxpayer” would mean the entire unitary business group throughout section 5211. See 1 J. Hellerstein & W. Hellerstein, State Taxation ¶ 9.21[l][a] (1993).
I would affirm the Superior Court judgment.

. 36 M.R.S.A. § 5244 (1990) provides in pertinent part:
The combined report ... shall include, both in the aggregate and by corporation, a list of the federal taxable income, ... the properly, payroE and sales in Maine and everywhere as defined in Chapter 821 and the Maine net income of the unitary business....

. Pursuant to 36 M.R.S.A. § 5211(14) (1990), sales of "the taxpayer” means sales of the entire unitary business group. Accordingly, pursuant to section 5211(15)(B), if property is shipped from this state by a member of the unitary group to another state, and any of the members of the unitary business are taxable in the distribution state (the state of the purchaser), then those sales are not considered sales of tangible personal property "in this State” within the meaning of section 5211(14), and are not subject to the "throw back” rule. Those sales are not Maine sales, and therefore are not included in the numerator of the sales factor in the apportionment formula.

. 36 M.R.S.A. § 5211(14) provides:
Sales factor formula. The sales factor is a fraction, the numerator of which is the total sales of the taxpayer in this State during the tax period, and the denominator of which is the total sales of the taxpayer everywhere during the tax period.
(Emphasis added.)
36 M.R.S.A. § 5211(15)(B) provides:
When sales of tangible personal property are in this State. Sales of tangible personal property are in this State if:
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B. The property is shipped from an office, store, warehouse, factory or other place of storage in this State and the purchaser is the United States Government or the taxpayer is not taxable in the state of the purchaser.
(Emphasis added.)

.Accordingly, pursuant to that construction, sales shipped from Maine to any destination state where the Maine nexus members of the unitary group are not taxable (even though another member of the unitary group may be taxable in that state) is considered a sale in "this State” and, pursuant to section 5211(15)(B), is "thrown back" for inclusion in the sales factor numerator pursuant to section 5211(14). This increases substantiaUy the income of the plaintiff taxable in Maine because it counts as sales in this state sales that actuaHy occur in other states.