excise on the franchise is based.1966 The franchise tax and the local tax on real estate and machinery are in no sense, however, complementary taxes.1967

"The deduction, from the value of a capital stock thus ascertained, of the value of the real estate and machinery thus returned as subject to local taxation, does not indicate that this 'excess' thus obtained represents in any sense the other personal property of the corporation, nor that it is intended as the measure of the value of such other property. The legislature saw fit to relieve corporations from the burden of this tax to the extent to which they were subject to local taxation upon their property; and this purpose could be effected with greatest simplicity and uniformity by the mode adopted.'

"' 1968

"By the term 'real estate, machinery and merchandise' the legislature intended to cover all the tangible property of a business corporation; and by the term 'securities,' as used in the statute, all choses in action which would be taxable to a natural person resident in Massachusetts. Any different construction of this clause would operate to exempt certain kinds of business corporations from all taxes except the taxes on real estate. Take, for example, an express business using no taxable property except horses and wagons. The owner, merely by incorporating it, would pay no tax at all." 1969

f. Real estate.

As to the valuation of real estate in determining the franchise tax, there should be deducted from the aggregate value of the shares the value of mortgages of real estate held by the corporation and subject to local taxation.1970 "In 1881, the legislature passed a statute, which was re-enacted without ma

1966 Firemen's Ins. Co. v. Commonwealth, 137 Mass. 81; Com. v. Hamilton Mfg. Co., 12 Allen, 298, 306; Boston & Sandwich Glass Co. v. Boston, 4 Met. 181, 184.

1967 Tremont & Suffolk Mills v. Lowell, 178 Mass. 469, 59 N. E. Rep. 1007.

1968 Commonwealth v. Cary Improvement Co., 98 Mass. 19, 22, per Wells, J.

1969 2 Op. Atty.-Gen. 558.

1970 Firemen's Ins. Co. v. Commonwealth, 137 Mass. 80.

terial change in the Public Statutes, providing that, for purposes of taxation, the interest of a mortgagee should be assessed as real estate, and that he and the mortgagor should be deemed joint owners.1971 This statute made the interest of a mortgagee, for all purposes of taxation, real estate subject to local taxation, and thus brought such interest within the words of St. of 1865,1972 which require the tax commissioner to deduct an amount equal to the value of their real estate and machinery, subject to local taxation, wherever situated.'

999 1973

Land leased by the corporation and upon which it is taxed, and buildings erected thereon by the corporation, may be deducted in ascertaining the tax.1974 And real estate is to be deducted even if used for other purposes than those for which the corporation is organized; 1975 but it seems that leased land is not to be deducted if it does not enter into the market value of the shares.1976

Shares in real estate trusts and the bonds of such trusts are to be deducted as securities, though there is no title to land in the shareholders.1977

g.-Machinery.

As to what is entitled to be deducted as machinery," see supra, § 71, d.

The deduction of securities which would not be taxable in the hands of a natural resident person is a new provision.1978

1971 St. 1881, c. 304, see R. L., c. 12, § 16.

1972 St. 1865, c. 283, § 5.

1973 Firemen's Ins. Co. v. Commonwealth, 137 Mass. 81.

1974 2 Op. Atty.-Gen. 556.

1975 Ibid.

1976 Ibid.

1977 2 Op. Atty.-Gen. 558, overruling 2 Op. Atty.-Gen. 402. Cf. Knight v. Boston, 159 Mass. 551; Hoadley v. County Commissioners, 105 Mass. 519; Gleason v. McKay, 134 Mass. 419.

1978 Formerly the failure to make such a deduction was no ground for the abatement of a franchise tax, nor was such a deduction proper. Manufacturers' Ins. Co. v. Loud, 99 Mass. 146; Com. v. Hamilton Mfg.

Deductions can be made only so far as authorized by statute.1979

Securities not taxable.

1982

These are: (a) Bonds of the United States and legal tender treasury notes; 1980 (b) stocks of domestic corporations for any year for which they pay a franchise tax; 1981 (c) stocks of foreign corporations paying a franchise tax here; (d) deposits in Massachusetts savings banks; 1983 (e) shares in voluntary associations and real estate trusts; 1984 (f) bonds of a real estate trust; 1984a (g) notes receivable, though unsecured, taken by the corporation in payment for notes in settlement of accounts, 1985

Taxable securities.

In addition to those specifically mentioned in R. L., c. 12, may be mentioned deposits in foreign savings banks.1986

i. Property in other states.

The value of tangible property in other States and taxable therein is to be deducted. But no deduction is to be made on account of the fact that a part of the value of the corporate franchise is property situated in another State.1987

Co., 12 Allen, 300; Com. v. Provident Inst. for Savings, 12 Allen, 312, 6 Wall. 611.

1979 Com. v. New England, etc., Tile Co., 13 Allen, 391, 393.

1980 U. S. St. 1862, c. 33, § 2; U. S. St. 1863, c. 73, § 1; Bank v. Supervisors, 7 Wall. 26; Banks v. Mayor, 7 Wall. 16.

1981 See infra, § 86.

1982 This is the practice of the tax commissioner, based on the principle of avoiding double taxation. The writer understands that the commissioners who prepared the corporation law did not intend to make this exemption.

1988 2 Op. Atty.-Gen. 558.

1984 Op. Atty. Gen. 558, overruling Op. Atty.-Gen. 402. Cf. Knight v. Boston, 159 Mass. 551; Hoadley v. County Commissioners, 105 Mass. 519.

1984a 2 Op. Atty.-Gen. 402. 1985 2 Op. Atty.-Gen. 558.

1986 2 Op. Atty.-Gen. 558.

1987 American Glue Co. v. Commonwealth, 81 N. E. 302. Cf. Louisville, etc., Ferry Co. v. Kentucky, 188 U. S. 385; Western Union Telegraph

§ 73. Appeal from local valuation.

"The tax commissioner may require a corporation to prosecute an appeal from the valuation of its real estate or machinery by the assessors of a city or town, either to the county commissioners or to the superior court, whose decision shall be conclusive upon the question of value. Upon such appeal the tax commissioner may be heard, and in the superior court costs may be awarded as justice requires.” 1988

a. Application to the assessors for an abatement.

A corporation aggrieved by the taxes assessed upon it may, within six months after the date of its tax bill, apply to the assessors for an abatement thereof,1989 even though the effect of granting the petition will be the abatement of the whole of the tax.1990 But it is not entitled to any abatement by the assessors unless it has filed the required statement of its prop,1991 although it may appeal from the refusal of the as

erty,

Co. v. Massachusetts, 125 U. S. 530; Massachusetts v. Western Union Telegraph Co., 141 U. S. 40; New York v. Roberts, 171 U. S. 658; Delaware, etc., R. Co. v. Pennsylvania, 198 U. S. 341; Home Ins. Co. v. New York, 134 U. S. 594.

1988 St. 1903, c. 437, § 73; R. L., c. 14, § 39; St. 1898, c. 417; St. 1890, c. 127, § 7; Pub. St., c. 13, § 41; St. 1865, c. 283, § 6. Citations. St. 1890, c. 127, § 7: Tremont, etc., Mills v. Lowell, 163 Mass. 283, 39 N. E. Rep. 1028; Tremont, etc., Mills v. Lowell, 165 Mass. 266, 42 N. E. Rep. 1134; Wright v. Lowell, 166 Mass. 300, 44 N. E. Rep. 249; Troy Cotton, etc., Mfy. v. Fall River, 167 Mass. 518, 46 N. E. Rep. 99; Williams College v. Williamstown, 167 Mass. 508, 46 N. E. Rep. 394; N. E. Theosophical Corp. v. Boston, 172 Mass. 60, 51 N. E. Rep. 456; Tremont & Suffolk Mills v. Lowell, 178 Mass. 471, 59 N. E. Rep. 1007; Harrington v. Glidden, 179 Mass. 486, 61 N. E. Rep. 54; Gardiner v. Brookline, 181 Mass. 162, 63 N. E. Rep. 397.

Pub. St., c. 13, § 41: Firemen's Ins. Co. v. Commonwealth, 137 Mass. 81; Lowell v. County Com'rs, 146 Mass. 408, 16 N. E. Rep. 8; Lowell v. County Com'rs, 152 Mass. 374, 25 N. E. Rep. 469; Troy Cotton, etc., Mfy. v. Fall River, 167 Mass. 522, 46 N. E. Rep. 99.

This section is the same as in the Revised Laws.

1989 R. L., c. 12, § 73, cited in Milford Water Co. v. Hopkinton, 192 Mass. 497; Amherst College v. Amherst, 193 Mass. 177.

1990 Milford Water Co. v. Hopkinton, 192 Mass. 491.

1991 R. L., c. 12, §§ 41, 74; St. 1853, c. 319, § 3. Otis Co. v. Ware, 8 Gray, 509; Winnisimmett Co. v. Chelsea, 6 Cush. 477, 483; Milford Water Co. v. Hopkinton, 192 Mass. 491, 498; Amherst College v. Amherst, 193 Mass. 168; Brooks v. West Springfield, 193 Mass. 192. As to interest and

sessors to abate the tax even where it has not filed any statement.1992

"The assessors shall, within ten days after their decision upon an application for an abatement, give written notice thereof to the applicant." 1993

This seems to imply that previous proceedings may be oral.1994

b. Estoppel to ask for an abatement.

The only estoppel upon a corporation against asking for an abatement of a tax on the ground of excessive valuation, if there can be any, is by reason of statements made to the assessors which misled them.1

1995

The refusal of the person making a list of property to answer all necessary inquiries does not prevent the obtaining of an abatement, although it may relieve the assessors from the obligation of considering the list as correct.1996

As we have seen,1997 the corporate franchise tax and the local tax on real estate and machinery are not complementary taxes. Therefore, the assessors are not bound by the valuation adopted by the tax commissioner, and if the latter adopts the valuation of the assessors, and the corporation pays the tax on that basis, it may still apply to the assessors for an abatement of the tax and appeal from their decision.1998

Where a corporation pays a tax on land, buildings and machinery, if the land and buildings are overvalued, it is entitled to an abatement, even though the total valuation may be fair. 1999

charges in connection with abatements, see R. L., c. 12, § 81 and Wright v. Lowell, 166 Mass. 298, 44 N. E. Rep. 249.

1992 Infra, under e. These provisions seem inconsistent.

1993 R. L., c. 12, § 76; St. 1890, c. 127, § 6.

1994 Page v. Melrose, 186 Mass. 364.

1995 Troy Cotton, etc., Mfy. v. Fall River, 167 Mass. 517, 46 N. E. Rep. 99.

1996 Wright v. Lowell, 166 Mass. 298, 44 N. E. Rep. 249.

1997 Supra, § 72, g.

1998 Tremont, etc., Mills v. Lowell, 178 Mass. 469, 39 N. E. Rep. 1028. 1999 Hamilton Manuf. Co. v. Lowell, 185 Mass. 114.