“[T]ax statutes are to be strictly construed in favor of the taxpayer and against the taxing authority”
How later courts described this case
- “[T]ax statutes are to be strictly construed in favor of the taxpayer and against the taxing authority”
Written by the judges who cited it.
The opinion
WELLIVER, Judge,
concurring in part and dissenting in part.
1 concur in the holdings of Points II, III, and IV of the principal opinion. I respectfully dissent, however, from Point I. The principal opinion ignores the clear and unambiguous language of § 143.431(1), RSMo 1978, which states in relevant part:
The Missouri taxable income of a corporation taxable under sections 143.011 to 143.996 shall be so much of its federal taxable income for the taxable year, with the modifications specified in subsections 2 and 3 of this section, as is derived from sources within Missouri as provided in section 143.451.
On November 5, 1968, the constitution was amended to provide as follows:
In enacting any law imposing a tax on or measured by income, the general assembly may define income by reference to provisions of the laws of the United States as they may be or become effective at any time or from time to time.... The general assembly may in so defining income make exceptions, additions, or modifications to any provisions of the laws of the United States so referred to ....
Mo. Const, art. X, § 4(d). The general assembly made the “exceptions, additions, or modifications” appearing in subsections 2 and 3 of § 143.431 and in the sections to which those subsections refer. Those “exceptions, additions, or modifications” do not mandate the construction the state has adopted. Nothing in the income tax scheme requires that a loss shown on a taxpayer’s federal income tax return be shown otherwise on the Missouri return. Without specific exception, addition, or modification, the figure appearing on the Missouri return should be the same figure appearing on the federal return, regardless of whether it reflects a profit or a loss.