Honorable Ernest Gulnn

CountyAttorney El Paso County El Paso, Texas
Dear Sir: OpinionNo, O-3545 Re: Whether **OP** not a money lender's occupation tax can be collected under Subdivision 15,Article 7047,Vernon's Annotated Civil Statutes,where'one person loansmoney as agent of another person. This is in reply to your request for OUT"opinion concerningmoney lenders. Your letter reads in part as follows:

"TheTaxAssessor-Collectorhas asked me to advise himwhether or not a State and Count,yoccupation tax can be collected from certain money lenders doing businesswithin the City of El Paso, and has specifieallgasked me whether or not Subdivision 15 ofAr,ticle7047 covers suchbusinesses,

"The facts,

of the case Involvedare these: a person living in San Antonio, Texas, has filed, in the assumed name records of this County, as owner of a money lending outfit, and has ~aman living in El Paso looking after the business here, t,heemployee in El Paso receiving a salary for hiswork2 as well as a corm~fssi~r~ on the loans m&e, and loans the money advanced in the business by the man in SanAntonio, If any losses are suffered in a loan, they are takenby the owner, inwhose name ,the business is registered, "Underthese facts is the owx,er required to pay the money lenders tax, and jiould the person employedby him in El Faso County be considered as an agent for the person advancing the money to loan?

"If the owner, or the person inwhose name. ,

Honorable Ernest Guinn, page 2 O-3545

the business is registered, lives outside of the State of Texas,would a different rule apply?

We are unable to find any statute that imposesan occupation tax on money lenders in addition to the tax provided for in Subdivision 15 of Article 7047,Vernon's Annotated Revised Civil Statutes of Texas,

This leavesus the questfon of'whether or not a tax is Imposed In the case you ask about by saidArticle 7047, the pertinent,

parts ofwhich read as follows: "There shallbe levied on and collected from everyperson, ffrm, company or association of personsp pursuing any of the occupations named in the followingnumbered subdIvIsionsof this article, an annual occupationtax, which shallbe paid annually in advance exceptwhere herein other-wise

provided, on every such occupation or separate establishment,as follows:

95 0 Money Lenders. -7From everg.person, firm, assocfation of personsJ or corporation %hose business Is lendingmoney as agent OP agent,3for any corporation, firm or association, either in this Stata or out of it an annual tax of One Hundred Fffty Dollars [$150000)(I Provfded, that ff an off'iceis maintained in more than one county, the State tax shallbe payable in each county 'wherean office is maintained; and, provfded, further, that this Tax shall not apply to persons, firms, or associationswho lendmoney as an incfdentmerely to the real estatebusWe%, T;OJshall said tax apply to banks, or banking iarly organized es **SL.C:=~** Fnstitu;ionsregua - o D e Itwill be no,tifced ,thatthe only personj firm, association, or @orporation taxes is a person, etc,, "lendingmoney as agent or agents for'

any **corPo~atiOR,** firm or associatfon". Under the facts that you give, there is a princ'ipal and an agent, and the agent is engaged in lendingmoney as agent for the principal. The agent is the person in El Paso, and the principal Is the person in San Antonio, The princfpal, the San Antonio person, **13** not liable for 'thetax because the tax is only Imposed on the person lendingmoney as afi agent.Honorable Ernest Guinn, page 3 o-3545

Is the agent, the El Paso person, in this case liable for the tax? We think he is not, because the onlymoney lending agents liable are tion". "agents for any corporation, firm or associaThe El Paso agent is not an agent for azporation, z or association,but he Is an agent for a person. An individual person'cannotbe construed to be a corporation,a firm **OP** an association.

"Corporationsare juristicpersonsbrought into ex-' istenceby the national government, orby some'foreign sovereignty", by some state of the Union, 10 Tex. Jur. 586. Certainly the principal, the San Antonio person, in this 'caseIs not a corporation.

We'do not believe that this San Antonio person could be construed to be a firm. In the case ofDodson v, Warren Hardware Co., (Texl Ct. Clv, App.) 162 S.W. 952, the court said:

II'A firm Is a partnership.' Black's Law Dist."
We cannot construe the principal in this case to be an association, In the case of In re Lloyd3 of Texas, (Dlst. CT.,N, D. Tex.) 43 Fed. (2nd) 383, the court said:

"An 'association is an organizedunion of persons for a good purpose; a body of persons acting together for the promotion of some object of mutual interest or advantage.

"It Is fundamentallya large partnership, fromwhich It differs in that it,is not bound by the acts of the individualpartners,abutonly by those of its manager or trustee; and that shares in it are transferable, and t&it it is not dissolvedby the retirement,death, or bankruptcy of its individualmembers.

Our answer to your inquiry is that no occupation tax can be collected from either the prineipal'or the agent under the facts you have given us. This answer applies whether the principal lives in Texas or outside of the State,Hbfioreble Ernest Guinn, page 4 o-3545

Yours very truly, ATTORNEY GENERAL OF TEXAS
By s,k Cecil C, Rotsch Cecil C. Rotsch Assfstant CCR:mp:wc s/GroverSellers
Approved Opinion CommitteeBy s/BwB Chairman