Untitled Texas Attorney General Opinion ( 1942 )

HEAYTORXEY GENERAL OFTEXAS Honorable George K. Sheppard Comptroller of Public Accounts Austin, Texas Dear Sir: Opinion No. O-4047 Re: Whether the tax levied by Article 7047, Section 41a, V.A.C.S., as amended by Article 12'of House Bill No. 8, 47th Leg., accrues on cement purchased from an out-of- State manufacturer by a Texas municipality. In your letter of September 14, 1942, you made the following inquiry: "Please tell me If the tax levied by Article 7047, Section 41a, V.A.C.S., as amended by Article 12 of House Bill No. 8 of the Forty-seventh Legislature, accrues on cement purchased from an out of State manu- facturer by a Texas municipality. I have in mind the case of the City of Dallas who purchased cement out of the State for the reason they cannot obtain it from a Texas manufacturer. "Will the City of Dallas be liable for the tax on cement used that was shipped to them from points outside of the State? "I do not know whether or not the City of El Paso case on Motor Fuel Tax would have any bearing in this matter." The statute in question reads In part as follows: "(a) Cement Distributors, There is hereby imposed a tax of two and one half (24) cents on the one hundred (100) pounds, or fractional part thereof, of cement on every pereonin this State manufacturing or producing In and/or importing cement into this State, and who thereafter distributes, sells or uses; provided, how- ever, no tax shall be paid except on one sale, dis- tribution or use. The person liable for said tax is hereby defined as a 'distributor,' to be allocated as hereinafter provided.' Honorable George H. Sheppard, page 2 o-4847 In opinion No. O-4731, this department has construed this statute as levying an occupation tax. Section 1, Article VIII, of our Constitutionprovides that the Legislature may "impose occupation taxes, both upon natural persons and upon corporations, other than municipal." (Emphasis ours) There- 'fore, the City of Dallas is not liable for the tax on cement under the facts submitted in your letter. In the case of State v. City of El Paso, 143 S-W, (2d)~366, the Supreme Court held that the motor fuel tax was not an occupation tax, and made this further distinction: "It follows that the tax here sued for is manifestly a ta~xon using motorsfuel in the operation of motor vehicles on the public highways of this State." Since the cement tax is an occupation tax, the constitutional exemption of mnicipal corporatfons from occupation taxes applies, Yours very truly ATTORNEY GENERAL OF TEXAS By s/Thos. B. Duggan; Jr. Ttos, B. Duggan, Jr. Assistant TBD:AMM:wc APPROVE0 OCT 19, 1942 s/Gerald C. Mann ATTORNEY GENERAL OF TEXAS This Opinion Considered And Approved In Limi~tedConference