### THEA-JXORNEY GENERAL
OF TEXAS

Hon. George H. Sheppard Comptroller of PublicAccounts Austin, Texas

Dear Sir: OpinionNo. O-97 Re: Prizes taxableunder Article 7047f,Vernon's Annotated Civil Statutes of Texas.

Your letter requesting our opinion sets forth the following facts:

"TheHouston Chronicle in an ad appearing In their Sunday,December 4 issue advertised ti0

theatre tickets to the MajesticTheatre inHouston and a $5.00 merchandise prize to be awarded to the winners of a contestwhich they operated under the name of 'Find-the-LineContest'.

"Theplan of the contestwas as follows: Five or six lineswhich were selected from the advertisements in Everybody's Gift Guide were printed In the ad. The participants in the contestwere asked to find the ad or ads in which each of such lines appeared. They were instructed to keep the ads or cut them out, Indicating which line went in which ad. The twenty nearest correct and neatest solutionsreceived were to be awarded tickets to the Majestic Theatre and the best answer was to be awarded the $5.00 merchandise prize.

"I am attaching hereto 8 cop% of the ad as It appeared in the paper.

You request our opinion as to whether the 20s prize,tax levied by Article 7047f,Vernon's Annotated Civil Statutes, isdue upon such prizes or awards.

For your conveniencewe set out below the pertinent portion of Article 7047f:Hon. George H. Sheppard - Page 2 

### o-97

"(a) Every person, firm, or corporation conducting a theatre, place of amusement, or any business enterprise in connectionwith the operation of which a prize in the form of money or something of value is offered or given to
one or more patrons of such theatre, place of amusement, or'business enterprise,and not given to allpatrons thereofpaying the same charge -- form certain service, commodity,2 entertalnment, shallmake a verifiedmonthly report
on the twenty-fifthday of eachmonth to the Comptroller of PublicAccounts of the State of Texas, showing the amount ofmoney so given in prizes, and the value of all prizes or awards so given in connectionwith suchbusinessduring the next precedingmonth.
"(b) There is hereby levied a tax equal to twenty per cent (20s)of the value of all suchmoney, prizes, and awards given in connection,with the operation of each and all of the foregoingbusiness enterprises,and at the time of making the report to the Comptroller of PublicAccounts, the owner or operator of any such business shall pay to the State Treasurer such tax upon the total amount of money, prizes, and awards so given during the next precedingmonth. * * *I'

In the fact situation submitted to us, it is obvious that certain participants, in their efforts to win the prize offered,would exert more and better directed effort and would perform more services than otherswould. In other words, the servicesrendered to the paper inworking out the contestwould not be equal on the part of all contestants, but would be different in each Instance, and the prizes being given to certain personswho had delivered an extra consideration, the casewould fallwithin the exception contained in that part of the statute above underlined.

Your question is answered in the negative. Very truly yours ATTORNEY GENERAL OF TEXAS

GRL-MR-WC
APPROVED NOV 

### 7,1939 s/Gerald C. Mann By s/GlennR. Lewis Glenn R. Lewis Assistant
ATTORNEY GENERAL OF TEXAS Approved Opinion CommitteeBy s/BWB Chairman