Untitled Texas Attorney General Opinion ( 1946 )

Hon. Geo. H . Sheppard Opinion No. O-7341
Comptroller of Public
Kccount s Re: Approval by Comptroller of a claim
riust in, Texas for refund of tax paid on motor fuel
thereafter sold by the claimant ex tax
to aircraft owners when the claimant
can make oath that the motor fuel was
Dear Sir: actually used for non-highway purposes?
In your letter of August 5, 1946, you have requested
an opinion from this office relative to the above subject and
in your letter you have presented two specific questions. The
first of these asks whether the Comptroller can “legally approve
a claim for refund of tax paid on motor fuel thereafter sold by
the claimant ex tax to aircraft owners when the claimant can make
oath that the motor fuel was actually used for non-highway pur-
poses.” The second question is conditioned on an affirmative
answer to the first. Specifically, two cases have occasioned
your request and the paragraphs of your letter presenting them
are quoted:
“In the first case, an airport operator has purchased
large quantities of av,iation fuel from a licensed refund
dealer in Texas obtaining an invoice of exemption for the
purpose of filing claim for refund of the tax paid by him
as soon as the motor fuel has been used for non-highway
purposes. The operator, however, did not use all of the
fuel in his own aircraft but he sold a large part of the
fuel to various other ai-craft owners who fueled their
planes at his field. In this instance the airport opera-
tor contends that he did not collect the tax from the
purchasers as he resold the fuel although the records
show that the profit he added to the original cost of the
fuel was more than enough to cover twice the amount of the
tax paid.
‘IIn the next case, a municipal airport located on
property owned by a city in Texas likewise claimed refund
of tax paid on motor fuel thereafter sold to various air-
craft owners who stored their planes in the airport hang-
XL-S. In this instance the operator of the airport col-
lected a $Uorage fee from the airplane owners but the fuel
sold to such owners was sold at actual cost after deduct-
ing the 46 tax. In other words, aviation fuel that cost
18q? per gallon including tax was sold at 146 a gallon
(Hypothetical figures) to said aircraft owners and the
Hon. Geo. H. Sheppard, page 2 (O-.7341)
municipal alrport claimed the refund instead of
the actual users”
The motor fuel tax a refund of which is here in *es-
tion, is imposed by Article $065b, Section 2a, V. A.C.S. which
provides in part as follows:
“There shall be and is hereby levied and imposed
(except as hereinafter provided) upon the first sale,
distribution, or .ISF: of motor fuel in this State an
occupation or excise tax c,: Four (4) cents per gallon
or fractional part thereof so sold, distributed, or
used in this State, * * *
I1 * * * In each subsequent sale or distribution
of motor fuel upon which the tax of r’o~r (4) cents
per gallon has been collected, the said tax shall be
added to the selling price I so tha.t such tax is ul-
timately paid by the person using or consuming said
motor fuel for the purpose of generating power for
the propulsion of any motor vehicle upon the public
highways of this State,”
Clearly, under the term of this statute, the tax imposed
thereby is to be passed on to subsequent purchasers and is to be
paid ultimately by the user or consumer. It follows that any ex-
emption from the tax should inure to the benefit of the user or
consumer and that any refund thereof must relate directly to the
use or consumption of the motor fuel on which the tax has been
paid. This is recognized in the provisions for a refund of this
tax following in Section 13 of this same kticle 7065b. It is
not deemed necessary to quote at length from, nor analyze in de-
tail, all of the provisions of this section. Suffice it to say
that the intendment of the entire section and of each of its sub-
sections is that the claim for a refund of motor fuel taxes shall
be made only by the user or consumers and that no refund shall be
made unless such user or consumer purchased the motor fuel from a
“refund dealer” as provided0
This section 13 providing for refunds operates as an ex-
emption to motor fuel taxes generally imposed. As such it should
be strictly construed and the burden is on the one claiming an
exemption from taxes to bring himself clearly within the statute.
(See Methodist Church v. City of San Antonio, 201 S.W. 669). Ex-
emption from taxation is never favored and in construing laws
exempting any citizen or class of property, all doubts are resolved
against the exemption. (See Santa Rosa Infirmary v. City of San
Antonio, 259 S.W. 926) o
Hon. Gee. H. Sheppard, page 3 (O-7341)
The section is an integrated statute devoted mostly to
procedures for obtaining refunds of the kind here in question.
By its terms (see subsection a) the refunds authorized are to be
made “in the manner and subject to the limitations described here-
in.” The procedures prescribed are of the essense of the statute
and a compliance therewith is a condition precedent to the right
to the refunds that it authorizes. d “refund dealer” is defined
and (in subsection b) the sale of motor fuel on which a refund of
the tax may be authorized by anyone without a refund dealer’s
license is prohibited and made a misdemeanor. Throughout the
statute it is manifest that a claim for a refund is to be made by,
and any refund paid thereon is to be paid to, the actual u.ser or
consumer.
There is no standard provided nor any reason found for
permitting any exception to the above requirements. This is sup-
ported by several considerations. First, the applicable rules of
construction above mentioned require a strict compliance with the
procedures prescribed in the statute. Second, under the princi-
ple of departmental construction, the long continued policy of
the Comptroller’s Department in requiring airports and boatdocks
desiring to sell motor fuel to private owners, to secure a refund
dealer’s license would resolve any possible doubt as to the in-
stant cases. knd third, there is the cogent reason that any ex-
ception could be extended to other sellers in the course of dis-
tribution or enlarged upon through the sale of increased quanti-
ties until the very purpose of the statute would be defeated.
The foregoing considered, it is the opinion of this
office that the Comptroller may not le ally approve a claim for
a refund of motor fuel taxes Iunless (1 ‘i the claimant was the ac-
tual user or consumer of the motor fuel and (2) the claimant
purchased such motor fuel directly from a licensed refund dealer.
This negative answer to your first question makes an answer to
the second unnecessary. It may be noted that the price at which
the fuel is sold does not affect the procedure for claiming a re-
fund.
kccordingly, you are advised that in the cases presented
the claims filed by persons other than the user or consumer may
not be approved.
APPROVEDSEP 11, 1946 Yours very truly
/s/ Grover Sellers ATTORNEYGENERALOF TEXAS
ATTORNEYGENERALOF BY /s/ Jackson Littleton
TEXAS Jackson Littleton, Assistant
APPROVED: OPINION COMMITTEE
BY: BWB, CHAIRMAN
JL: JMc:wb