Untitled Texas Attorney General Opinion ( 1957 )

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July 24, 195-r
Hon. Robert S. Calve& Opinion No. WW-204
Comptroller of Public Accounts
Capitol Station Re: Whether or not the tax
Austin, Texas referred to in H.B. 433,
55th Legislature, Section
28, is an occupation tax
under Section 3, Article
Dear Mr. Calvert: VII, Constitution of Texas
You request the opinion of this offi,ceupon the
question presented in your letter of July 11, 1957, which
is as follows:
"H.B. 433, 55th Legislature, Section
28, reads in part as follows:
"'In addition to all other taxes now
being paid, each stock company, mutual company,
reciprocal, or interinsurance exchange or
Lloyds Association writing Workmen's Compensa-
tion insurance in this State, shall pay annually
into the State Treasury, for the use and benefit
of the Workmen's Compensation Fund, an amount
equal to one-fourth (l/4) of one per cent (1s)
of gross premiums collected by such company or
association during the preceding year under
workmen's compensation policies written by
such companies or associations covering risks
in this State according to the reports made
to the Board of Insurance Commissioners as
required by law.'
"Please advise me if this tax is an
occupation tax, under Section 3, Article VII,
Constitution of Texas. The question is asked
for the reason that if the tax is an occupation
tax, one-fourth (l/4) will be deposited to the
Available School Fund."
you quote only the portion of the statute levying
the tax. A better understanding of the question is achieved
by quoting all of the pertinent part of Section 28 of said
H.B. 433, which is as follows:
Hon. Robert S. Calvert, page 2 (WW-204)
"'Section 28. There is hereby established
as a special fund, separate and apart from all
public moneys or funds of this State, a Workmen's
Compensation Fund which shall be used by the board
for the purpose of paying costs of the administra-
tion of the law, in addition to amounts annrooriated
by the Legislature of the State of'Texas.. The
State Treasurer shall be the treasurer and custodian
of the fund. He shall administer such fund in
accordance with the directions of the board, and
the Comotroller shall issue warrants unon it in
accordance with the directions of the board. In
addition to all other taxes now being paid, each
stock company, mutual company, reciprocal, or
interinsurance exchange or Lloyds Association
writing Workmen's Compensation insurance in this
State, shall pay annually into the State Treasury,
for the use and hri?%fit of the Workmen's Compensa-
tion Fund, an amouTequal to one-fourth (l/4) of
one per cent (1%) of gross premiums collected by
such company or association during the preceding
year under workmen's compensation policies written
by such companies or associations covering risks
in this State according to the reports made to
the Board of Insurance Commissioners as required
by law. Said amount shall be collected at the
same time and in the same manner as provided by
law for the collection of taxes on gross premiums
of such workmen's compensation insurance carriers.
(Emphasis supplied.)
No useful purpose will be served by discussion of
the distinction between an occupation tax and other forms of
taxation. It is sufficient fcr your purpose that 'wehold
this tax is not an occupati?n tax. We believe the language
of the statute compels that conclusion, The tax is deposited
in a special fund with the State Treasurer as custodian to be
used for a scecial ournose, namely, to nay the cost of adminis-
tration of the Work;nen;sCompensation law-of which it is a part.
As said by the Supreme Court in the case of the Cit of Fort
Worth v. Gulf Refining Co., 125 Tex. 512, 83 S.W. -T?+br-
"An occupation tax is levied primarily for
the purpose of raising revenue, and unless the
measure before us is primarily a revenue measure,
it is not an occupation tax. D D .'
You are therefore respectfully advised that the tax
levied by Section 28, H.B. 433 of the 55th Legislature is not
_ --
Hon. Robert S. Calvert, page 3 (``-204)
an occupation tax requiring one-fourth (l/4) of the same to be
allocated to the Available School Fund as required by Section
3 of Article VII of the Constitution of Texas.
SUMMARY
The tax levied by Section 28 of H.B. 433
of the 55th Legislature is not for the
purpose of raising revenue, but for the
specific purpose of administering the
Workmen's Compensation law of which it
is a part, and is not an occupation tax
requiring one-fourth (l/4) of same to
be allocated to the Available School Fund
as provided in Section 3 of Article VII
of the Constitution of Texas.
Very truly yours,
WILL WILSON
Attorney General
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ByL.$< liar
Assistant
LPL:gs
APPROVED:
OPINION COMMITTEE
H. Grady Chandler, Chairman
J. C. Davis, Jr.
Fred Werkenthin
Grundy Williams
REVIEWED FOR THE ATTORNEY GENERAL
BY:
Geo. P. Blackburn