. . 

TRIE .L-ITNBRNEY GENERAL 

OF TEXAS 

AKXWX-IN, -l-lzxAs 78711 

June 5, 1968 

Honorable Robert S. Calvert OpInIonNo. M-241 

Comptroller of Public Accounts 

State Capitol Eulldlng Re: Applicability of credit 

Austin, Texas provision of Article 7359a, 

V.C.S. to mator vehicle use 

taxes Imposed by Article, 

Dear Mr. Calvert: 6.01(2), Taxatio++eneral 

Your letter requesting the opinion of this office on the above 

question reada as follows: 

"The Comptroller hereby request8 your official 

opinion regarding the application of the Motor Vehlole 

Sales and vase Tax, Chapter 6, Title 122A, TaxatlonGeneral, Texas Civil Statutes, as amended, 1925. Article 

6.01.(2) and (3) (Taxation-General) provide for a use tax 

upon any person bringing a motor vehicle into the State 

for use upon the public highways. Article 6.01(2) reads 

as follows: 

"There Is hereby levied a use tax upon 

every motor vehicle purchased at retail sale 

outside this State and brought into this State 

for use upon the public highways by any person, 

firm or corporation who is a resident pf this 

State or who is domiciled or doing business in 

this State. The tax Imposed by this subsection. 

shall be equal to two per cent (2$) of the total 

consideration paid or to be paid for said vehicle 

at said retail sale. The tax shall be the obliga+,< ' 

tlon of and be pald by the perscin, firm or aorporai 

tlon operating said motor vehicle upon,the public 

highways to this State. 

"Article V(1) of 

provides for a credit 

reads as follows: 

Article 7359a 

under certain 

(Vernon's Civil Statutes) 

Instances. Article V(1) 

-1177- 
Hon. Robert S. Calvert, page 2 (M-241) 

"Each purchaser liable for a use tax on 

tangible personal property shall be entitled 

to full credit for the combined amount or 

amounts of legally lmpos~ed sales or use taxes. 

pa~ld by h3m with respect to the same property 

to another state and any subdivision thereof. 

Then credit shaIl,be .eppIied first against the 

amount of eny use: 4x$x due.' then state.~ end wiy unused 

portion of the c.redlt shall be then applied 

against the amount of any use tax due a subdivision. 

"Under the above~prov~lslon, la the person who 

has paid a e-ales taxin. another &ate on the,,purchase 

of a motor vehicle entitled to,,a. credit aga-lnst the 

Texas tax on. the use.of~ ,the motor vehicle In this 

State. SecoMIy, is- the person entitled to the same 

credit against the u~se taxlevied by Article 6.01(3) 

which reads~ as follows:~ 

"There is herebyylevied a use tax In the 

sum of Fifteen DoLIars- (.$15) upon anyperson 

making application for the initial certificate. 

of title on a motor. vehicle which wes previously~ 

registered In hls~ name-, .in any other .Stste ,or 

foreign cauntry.' It ls'the -purpoa~~of-this,-sub-- 

section to lmpoee a.uee~~tax upon motor vehicles 

brought into this State .by~new residents of this 

Stete.",- (perenthes~ls- ou-rb)’ 

At the outset we note that the two taxes imposed by subsections (2) and (3) of Article 6.01 are alternative in the,,ser8@e 

that if one tax Is lmposed, then the other tax Is not lmpoeed~. 

By Section 1 of Article 7359a, the State of Texas adopted~ 

the Multistate Tax Compact, which became effective In Texas 

June 13, 1967. One of the express purposes of the Compact, es 

set out In Article I, is to avoid duplicative taxation. While 

some provisions of~the Compact apply only to tax situations lnvolving states which are parties to the Compact, paragraph 1 of 

Article V of the Compact Is not so limited. 

Paragraph 7 of Article II of the Compact defines "sales tax" 

and paragraph 8 further provides: 
. . 

Hon. Robert S. Calvert, page 3 (~-241) 

"'Use tax' means a nonrecurring tax, other than 

a sales tax, which (a) is Imposed on or with respect 

to the exercise or enjoyment of any right or power 

‘over tangible personal property incident to the ownershla, possession or custody of that property or the 

leading of the property from another including any 

consumption, keeping, retention, or other use of 

tangible personal property and (b) is complementary 

to a sales tax." 

The taxes Imposed by subsections (2) and (3) of Article 6.01 

clearly are use tslxes with-the definition just quoted. Inasmuch 

as subsection (1) of Article 6.01 l&es a tax upon every retail 

sale of every motor vehicle sold In Texas, the use taxes levi&d 

by the next two subsections are complementary to a sales tax. 

Paragraph (b)!of 

"Nothing In 

II . . . 

the r.$~tr%% 

fuel, other than 

Article XI of the Compact provides: - 

this compact shall be construed to: 

to ar#! tax or fixed f&i Imposed for 

of a motor vehicle or any tax on motor 

a sales tax. . .' 

While Article 6.04 directs Texas county tax collectors to 

refuse to accept for registration or transfer any motes? vehicle 

until the tax Imposed by Article 6.01 Is paid, we are of the 

opinion that this does not ,have the,effect of converting the 

use tax Imposed by Article 6.01 Into a "ta$ or fixed fee imposed 

for the registration of a motor vehicle" within the meaning of 

that term as used in the Compact. The statutory construction 

applicable In such a case requires a strict coryltructlon against 

the taxing authority and a liberal construction in favor of ,the 

$axpayeti. Texas Unemployment Comoensation Comm. vs. Bass, 137 

Tex. 1, 151 S.W.2d 567 (1941). This conclusion is prompted first 

by the fact that Texas law Imposes other and separate .fees for 6 

certificates of title and registration. Secondly, Article XII 

of the Compact direct? that It shall be liberally construed so 

as to effectuate Its purposes, one of which Is, as noted above, 

to avoid duplicative taxation. Furthermore, a construction df 

a statute authorizing double taxation should not be adopted 

unless the la 

Tex.Jur.%?d 13 ?F 

uage used admits of no other construction. 54' 

, Sec. 21, Taxation, and cases cited. In the event 

-1179- 
Hon. Robert 9. Calvert, page 4 (~-241) 

it be contended that Article 6.01 conflicts with the Compact Law 

In Article 7359a, the Compact Law will prevail to the extent of 

any conflict. State BX rel Dyer vs. Slma; 341 U.S. 522 (1951). 

In answer to your specific questions, we are of the opinion 

that the credit provided for In paragraph 1 of Article V of Article 

7359a should be allowed to a person who as a purchaser has paid 

legally imposed stiles or uge taxes on a motor vehicle to another 

state and thereafter becom&s subject to the tax imposed by either 

subsection (2) or subseotlon (3) of Articl& 6.01. 

SUMMARY 

The credit provided for In paragraph 1 o,f Article V 

of Article 7359a, Vernon's Civil Statutes, should,be 

allowed to a person who as a purchaser has paid legallyImposed sales or use taxes on a motor vehicle to another 

state and thereafter becomes subject to the tax Imposed 

by either subsection (2) or subsection (3) of Article 

6.01, Taxation-General. 

very truly, 

:p+== 

MARTIN 

neral of Texas 

Prepared by Nell Williams 

Assistant Attorney Qeneral 

APPROVED: 

OPINION COMMITTEE 

, Hawthorne Phillips, Chairman 

Kerns Taylor, Co-Chairman 

Narlo Q. Ob$edo 

Ben Harrison 

Robert C. Crouch 

Charles Rose 

A. J. CARUBBI, JR. 

Executive Assistant 

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