State Tax Commission v. Walter E. Heller & Co.

The Appellate Tax Board in a decision for Walter E. Heller & Company, Inc. (Heller) granted it an abatement of corporation excise taxes for the years 1962 to 1964, inclusive, and of an instalment of an estimated corporate excise for 1965. Heller contended that in this Commonwealth it was engaged exclusively in interstate commerce, consisting of lending money from its New York office (by factoring, making collateral loans, and purchasing instalment obligations) to business entities operating in Massachusetts, and in activities related to such loans. The board made ample subsidiary findings. These were supported by substantial evidence. The board concluded that Heller’s chief Massachusetts activity was of an “interstate nature and that all other [¡such] activity . . . was in aid of” Heller’s “lending money from New York to its Massachusetts clientele.” Similar issues were fully discussed in M. A. Delph Brokerage Co. Inc. of New England v. State Tax Commn. 347 Mass. 64, 67-69. See Alpha Portland Cement Co. v. Massachusetts, 268 U. S. 203, 218-220; Spector Motor Serv. Inc. v. O’Connor, 340 U. S. 602, 605-610. Of. Atlantic Lumber Co. v. Commissioner of Corps. & Taxn. 298 U. S. 553, 555-557; Union Brokerage Co. v. Jensen, 322 U. S. 202, 209-212; Northwestern States Portland Cement Co. v. Minnesota, 358 U. S. 450, 463-464, 466-469, 470-477, 486; General Motors Corp. v. Washington, 377 U. S. 436, 446-448. Upon the findings, Heller’s Massachusetts activities were interstate commerce or incidental thereto. We think that the Alpha Portland Cement Co. and Spector Motor Serv. Inc. cases, supra, so long as they remain unmodified by later decisions or Congressional action, preclude the imposition of a Massachusetts corporation excise in its present form upon a foreign corporation with respect to engaging in the Commonwealth exclusively in interstate commerce. See G. L. c. 63, § 39 (as amended through St. 1960, c. 548, § 7, and St. 1962, c. 756, § 8; later amendments not here applicable). For a review of decisions largely concerning broader tax statutes in other States, see Roadway Exp. Inc. v. Director, Div. of Taxn. 50 N. J. 471, esp. at pp. 491-492. See also 15 U. S. C. (1964), §§ 381-384, and 48 A. B. A. Journ. 35, 36, 1133.

Allan G. Rodgers, Special Assistant Attorney General, for the State Tax Commission. Herbert Baer for the taxpayer.

Decision of the Appellate Tax Board affirmed.