T 

February 20, 1952 

Hon. Robert S. Calvert ~~ Opinion No. V-1408 

Comptroller of Public Accounts 

Austin, Texas Re: Applicability of gross receipts taxes to air~express 

revenues received by Railway Express Agency, Inc., 

Dear Mr. Calvert: under the submitted facts. 

You request the opinion of this office upon the question presented in your letter of January 23, 1952, as follows: 

“Article 7058, V.C.S. reads in part as follows: 

* ‘Each individual, company, association or : 

corporation doing an express business by steam railroad or by water in this State shall make, quarterly, 

on the first days of January, April, July and October 

of each year, a report to the Comptroller, under oath 

of the individual or of the president, treasurer or 

superintendent of such company, association or corporation, showing the gross amount received from 

intrastate business done within this State in the payment of charges from express and freights, or from 

other sources of revenues received from intrastate 

business during the quarter next preceding.’ 

“I am enclosing copy of Air Express Agreement between Railway Express Agency, Inc. and the 

various air lines ~4th which they do business. 

“Please advise me if the air expres~s revenue 

received by Railway Express Agency, Inc.. under the 

terms of the agreement, is taxable under the provisions of Article 7058, V.C.S.” 

With your opinion request you submit for our examination a contract form behveen Railway Express Agency, Ipcorporated, and the air line company referred to in the contract as 

“Air Company, * which covers the contract or agreement between 

the express company and the air company with respect to the undertaking on the part of the air company to transport by air shipments of the express company. This contract is lengthy and 

somewhat involved, but it is sufficient to say that the air company 
Hon. Robert S. Calvert, Page 2 (V-1408) 

undertakes in behalf of the express company to perform by air 

express a certain part of the transportation of the shipments 

contemplated by the contract. The express shipments involved 

begin and end with the express company, the air company performing the intervening transportation. 

Article 7058, V.C.S., tevies a gross receipts tax 

on express companies carrying on business *by steam railroad” 

and requires such express companies to file h4th the State 

Comptroller on the first day of January, April, July and October a report “showing the gross amount received from intrastate business done within this State in the payment of charges 

from express and freinhts, or from other sources of revenues 

received from intrastate business during the quarter next preceding.” 1 At the same time such companies shall pay to the 

-SE Itereasurer -an occupation tax” for the succeeding quarter 

“equal to Two and One-half (2:s) Per Cent of said gross receipts” as shown by the report. 

Specifically, ‘your question involves the receipts by 

the express company derived from that part of the transportation performed by the air company. 

Article 7058 was amended by House Bill 648, Acts 

42nd Leg., R.S. 1931, ch. 222, p. 376; and certain changes were 

then made to the original act. The word Usteam” was added; so 

the act, as amended, applies to express companies doing an express business by steam railroad instead of by railroad as was 

provided in the original act. The following was also added: * 

. * . or from other sources of revenues received from intrastate business during the quarter next preceding.” The only 

other change made by the amendment to the original act was to 

provide for quarterly payments instead of annual payments. We 

find upon examination of the emergency clause to this amended 

act a clear expression of the legislative intent. It reads: 

“The fact that it will be beneficial to the revenues of the State to have express companies pay a 

quarterly tax in lieu of an annual tax, and the further 

need of amending the statutes so as to make same apply to express business done on other carriers than 

steam rai roa s, . . . 

We are here primarily concerned with the following 

expression appearing in the body of the act and constituting a 

1 Emphasis added throughout. 
. . : 

Hon. Robert S. Calvert, Page 3 (V-1408) 

part of the amendment: * . . , or from other sources of revenues received from intrastate business during the quarter next 

preceding.” This phrase, construed in connection with the express purpose as stated in the emergency clause, leads to the : 

conclusion that the receipts from such air line transportation is 

subject to the tax. In brie&; the purpose of the amendment was 

to impose the tax not only upon the receipts from that part of 

the business done by the steam railroads, but also upon other 

sources of revenue derived from express business done by 

other carriers for and in behalf of the express company. 

SUMMARY 

An express company is subject to the gross 

receipts tax imposed by Article 7058, V.C.S., on 

that part of its receipts arising from transportation 

of freight by the air lines in behalf of the express 

company. 

Yours very truly, 

PRICE DANIEL 

Attorney General 

APPROVED: 

W. V. Geppert 

Taxation Division 

Mary Kate Wall 

Reviewing Assistant 

Charles D. Mathews 

First Assistant 

By L?&?o13f-- 

Assistant 

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