Untitled Texas Attorney General Opinion ( 1940 )

THEAYTORNEY GENERAL
OFTEXAS
GERALD C. MANN
Honorable George H. Sheppard
Comptroller.of Public Accounts
Austtn, Texas
Dear Sir: Opinion No. 0-2079
'Re: Persons ~paging excessive chain
store taxes errone.ouslgin pr6-
vious gears-'cannotset off those
payments against taxes due for the
correct year.
This is~ln answer to your inquiry in regard to ah ex-
cess payment of chain store taxes, which lnqutrg reads in part
as follows:
"A corporation (a), either under a mistake
of law or a mistake of fact, pays Chain Store Tax
0n.a number of stores. It 1s later determind
th@iitthe stores in question were not a chain and
that such corpbration ha3 overpaid the amount of
tax required, ana that.the stores ijaiaon are not
subject to the tax as a chain but as an individual
unit.
"Is this department authorized to credit
the taxes due by such corporation for a subee-
quent sear with the excessive amount of money
collected for the prior year?"
" . . . upon receipt of the moneys paid bg
the corporation as chain store tax such money was
cleared through this department and placed in the
State Treasury In the General Revenue, and sych
money now rests In the General Revenue Fund.
"The Chain Store TtixLaw" (House Bill 1.8,44th Leg.,
First C.S., 1935), codified as Article lllld'of Vernon's Annotated
Penal Code, provides for the payment of certain license fees for
the pidvllege of operating stores, a license being required for
each store. These license fees have been held by the Supreme
Court of Texas to be occupation taxes. Rurt vs. Cooper, 130 Tex.
433, 110 S.W. (2a) 896.
The parts of this law with which we are concerned are
as follows:
Honorable George H. Sheppard, page 2 O-2079
"Sec. 2. . . . It Is hereby made the fur-
ther duty of the Comptroller to collect, superiilse,
and enforce the cblle&tlon of all license and.ap-
pllcation~fees that tig be due under the provisions
of this Act and to that.end the salKComptroller 1s
hereby vested with tillof the,,powerand authority
conferred by this Act . . . .
"Sec. ~3. . . If an application is~founa
to be satisfactoryf and If the filing and license
fee as herein prescrlbed.shall have been paid, the
ComptPolleP of Public Accbunts shall issue to the
applicant a license for each store or mercantile
establishment for which an application for a license
shall have been made. . . . . .'
"Sec. 4. All licenses shall be so issued as
to expire on the thirty-first day of December of
each year. On or before the thirty-first day of
December of each years, every'person, agent,~redelver,
trustee, firm, corporatlon,~association or copart-
nership having a license shall Bpply tb the Comp-
troller of Public Accounts for a renewa; license for
the calendar year next ensulng. . . . .
"Sec.5. . . . The license fees herein pre-
scribed shall be as follows: (Here Is set out the
amount of the fees.)
l,
0 . . Such fees are for the period of twelve
(12) months, and upon the issuance of any license
after the first day of ganuary of any one year, there
shall be collected such fractional part of the license
herelntibovefixed as the remaining months in the
calendar year (Inclualng the month in which such
license i&issued) bears to the twelve month period."
"Sec. 9. . . . All modes collected by the
Comptroller of Public Accounts under the provisions
of this Act shall be pald by him into the State
Treasury dally as received; one-fourth of same shall
be credited to the account of the Available School
Fund and.the remainder shall be credited to the ac-
count of the General Fund. . . . ."
There is no provision in "The Chain Store Tax Law"
thist.
provides that where a person has erroneously paid more
chain store taxes than was due he should receive credit for this
excess or erroneous payment when he makes his next oi"a subse-
quent chain store tax payment. It is significant that there 15
such a provision In some of the other tax laws of this state, an
Honorable George H. Sheppard, page 3 O-2079
example being the gross production 011 tax law (codified as
Article 7057a of Vernon's Annotated Revised Civil Statutes).
It is a general rule of law, adhered to In most jurls-
dictions, that a person who has paid excessive taxes erroneotis-
ly in previous years cannot set-off those payments against taxes
for the current year. the rule is stated in 3 Cooley on
diie-
Taxation, 4th Ed., 2640, par. 1336, as follows:
' 1336.~ Unless by express provision of sttitiite
set-off is not~allowtidin suits for takes. 'So Illegal
or excessive taxes paid itiprevious yeiirscannot be~set-
off agaInat current tax'aemanas. 'Any agreement between
tax officers and a taxpayer that a pre-existing claim
may be set-off against texes is of no eff&t, at least
where the tax officers have no power to make such an
agreement."
In the case of Darby v. City of Vldalla, (Sup. Ct.
Ga.) 168 Ga. 842, 149 S.E. 223, the court said:
"'As matter of public policy, founded on the
exlgancles of government, mnlcipal corporations
nolsthave present command of their current revenues.
Property holders who have paid, whether voluntarily
or by coercion, llle al taxes in former years, have
no right to set off 7by Injunction or otherwise) such
payment3 against executions issued for the taxes of
later years.'"
In the case of Shelton v. Blount County, (Sup. Ct.
Ala.) 202 Ala. 620, 81 Sou.,562, the court said:
"We must presume that the defendant tax col-
lector discharged this duty as prescribed by law,
and It seems clear that his account for the tax year
of 1914 was thereby effectually detached from h1s
accdunt for the ensufng year, and that those accounts
were in no sense single or continuous. In line with
this theory, it has b&en held that the takes col-
lected for one year cannot be apulled as e credit on
the fund due to be accounted for by the tax collector,
for any other year, but must be paid end credit.& as
for the year for which they were cbllected. State
use of Winston County v. Tingle, Tax Collector, 196
Ala. 505, 71 South, 991. (Underscoring ours,)
It Is our ofiinionthat the rule announced in the fore-
going cases controls-'th&answer to your QuestIon. We“have-'been
unable to find e Texas appellate court case on this same fact
-. .T .
Honorable George H. Sheppard, page 4 O-2079
situation, but we see no reason why Texas shouldnot follow'the
general rule.
We are basing this opinion on the foregoing reasons
aid authoritle's;but tiecell attention to the statement In the
case of-Austin National Bank v. Sheppard, 123 T&x. 272, 71 S.W.
2nd 242, as follows:
"A.-personwho vbliint&rllg;
pegs en illegal tax
has no claim for Its repayment.
That stetemefitwas reiterated by the Supreme Court of Texas in
the recent case of~Nationa1 Blscult Coinpenyv. State, 135 S;W/
2nd'687. 'To the same effect are-the~ca&es'of'City~ofXouston v.
Felzer; 76 Tex. 365, 13 S.W. 266, end Marion v. Lockhart, 131
Tex. ,175, 114 S.W. 2nd 216.
We do not deem It necessary et this tiineto decide the
question of whether or not the~leglsleture could euthoi+lzeyou
to give crdit for this over-payment-forrefund these taxes~er-
roneously paid. That would involve a construction of Artli9e
VIII., Sectlofi6 of th%Constltutlon-.of Texas. The Ieglsleture
has not yetmade such &uthori.zetiones faties this case Is con-
cerned.
Our answer to your inquiry Is that you are not
auttiorlzecl
IX'credlt the chain store taxes now owed by'the c‘dT-
@oration with-the money erroneously paid by the corporation es
chain store taxes for prior years.
Yours very truly
ATTORNEY GENFRAL OF TEXAS
By s/Cecil C. Rotsch
Cecil C. Rotsch
Asslstant
CCR:ew:wc
APPROVED MAR 28, 1940
s/Gerald C. Mann
ATTORNEY GENERAL OF TEXAS
Approved Opinion Commlttee By s/BWB Chairman