The case, which the SJC transferred sua sponte from the Massachusetts Appeals Court, concerns taxpayers’ rights to apportion Massachusetts sales tax with respect to software purchased for use in multiple states. The case raises important issues concerning the Massachusetts Commissioner of Revenue’s authority, including whether it may promulgate substantive tax law and curtail taxpayers’ statutory abatement rights via regulation.

At oral argument Rich explained that the Massachusetts Constitution vests the Legislature with the exclusive authority to impose tax, and contends that the Commissioner has authority only to determine how, and not whether, sales tax from software sales may be apportioned. He further argued that the Commissioner’s regulation did not (and indeed, could not) abridge a taxpayer’s right to seek apportionment through the statutory abatement process.