## 486

OFFICE OF **THE** AmORNEY GENERAL OF TEXAS AUSTIN

Ebnorablo Cieor60H. Shoppar Comptroller of Public roeountr Austin, TIxa8
Dear 

### Sir:

08 rhow that the plaoer in iU43 ?OiZ-if$OFAtOl# PIe #Old 4nd lanoar are solb, arm 6t.o;;: . 0 Chain **Store** Tax Law. ena **tatore** oonotitute me rlaglr orpant. chain0 on tha theorf **that**

**nefd*r** **thrt** 

### ator in whioh ior rerriewwithin 

### Seotlon 5 and that the8 

### torae in which sleotrioal appUanoe# are eold 004~ within Soctlon Sa, an4 that you desica to know whether 6torer trade Sootion 5 an4 

### atoror underWotloa SE ~onrctitute 8eparato chain8 

### or one dngla chain.

The Taxa8 chain Store Tax Law WM originally pas8dtlonorable **Geor&e** is. ahopysr4, Pa@ Y

a8 ilousehill ho. 18, chapter 400, dot8 19J5, yorty-fourth hgislaturo, Yirst CalloQ ijesaion.ad It la **oodliled** aa Artlole lllld or iferon*n AtiAotatedPenal Code or the State of Texas.

me term 9~toro* 18 4erhe4 in :2eotion7 of raid L&W uo r0ilows:

**“ iloo.**  **7.** The term *~tor.* a8 ~8.4 in thlo **hot** 8Aall be 

### oonatrued to aeaA and Iiioludeany atore 

### or storer or any srreaatlle establishmat or 

### l stabiishmats Aor ap.Oifioally 

### l xenpted uithln tbi8 Act wbloh are owned, operated, matatained, or oontrolled by the **base** person, agent, 

### receiver, **,trurtee,** 

### rlrta, corporation, oopartAer8hIp 

### or aawol~tlon, either doaeetio or iorelgn, **ln** whloh goods, ware8 or IwroAandlro of Amy kind are sold, **at** ret811 or whole6818.*

The parts 0r the law that desitjpatethe 8tor.r to r;hlohit a2pll.8 are section 8 8~4 Seotion Sa, 

### whioh**read** 4tsroiiowrt

Y3.0. s. IIvoryperron agent, 

### rooelver, **tru8t.0,** rim, oorpomt Ion, a88ooIat1on or 0opartAerrblp opeains, ertsblI8hIng, operatfng **or** amlntalnIA6 on. 

### or :WY)I. stores cr .mroantlls establi8haents withes thlr State, under 

### tho r)*.ae genwal #AWUi&emeIItor 

### ownership, 8hsll gay the lloe~ae roe8 

### hereinliter presoribsd ror the prlvliege of opening, e8tabllshIn(l, oporatlcg or PraIAtaIAlAgbuoh #tore8 or meroant~l~ 

### l 8tablIehmeAt8. Tho lioense fee herein pTe8Orlb.d 8hall be paid annually anb rhall be in addition to the riling Se0 preuorlbed in tieotlon8e and 4 of thin hot. ProtI&ed that tho **terms,** *otore, 8toro8, mmcantfl. .stablishaeAt or a@roantfir establi8tints' wh.A.T.r Us.4 iA this POt .hali Aot IAOlUbO: wholesale and/or retell 1urob.rand building material buslA9S808 .Agagi:dexoluslvely IA the sale 

### or lumber an4 butl4IAg zaterial; an&/or 011 aAd &a8 rail 8upplie8 and equIpmAt dealers; or any plaoo 0r bUsln.scr*A

### gogrd l xolusively IA the atorlng, aelli~g, or aintrIbutIAg or pstroleus produots a~4 8ervloIng 0r sotor vehiales; or any buriaera now paylng an OOOUpatiOA tsx zea8ured by glBo8.rO..Iptsi or any plao.

# I

HoAorable 6oory ii. iiheppard, Page 3

or ylaoee of bu.iA.8* u8.4 a. boA. rid0 whol.8al. or retail 4istrlbutIAg points by amnufaoturln~ eonottma ror di&trlbutiOA 

### 0r produats or thrlr ow manufeaturr 0Aly; cc any plaor of places 0r bu8iae88 use4 by tons ride procoosorn 

### or dairy poduetr~ror tho exelu8lve se10 at retail of auOh products.

Tb. lloen8e fee8 horein preeorIb.6 shall be ~8 roiiowut
+1. ;pOA o~i(l(1) store the 1iooA.a fee 8ball be One Uolier ($1);
"3. uL;oA O&Oh .d‘iitiOA.l StOr. iA QXO... Oi on0 (1) but not to exoo.4 two (2). the llaen8e r00 shall be Six Dollars (@)g
rn3. Up2A eaah adaitfonal store ifi0x088~ 

### or tW0 (3) but Aot t0 eXt064 iIV0 (b), the lIOU&SO f.0 shall be meAtpriV0 Dollars {Qar;)i

*4. upon each~tiaciti0m ntore 

### in er.oa88of ilr. (5) but not to .xo..4 ten ilO) the ll..A8a i.. hall be Pirty dollars (#soi;
“6. UpOA each additiOM1 titOx-0 in OXOOeS O? tan (10) but Aot to exoeed twenty (izO),the llo~se i.0 oh.11 b. OA@ **Eundrod** fifty ~OlltW. ($A.#))1

Upon eaoh addltloml tatoreia e%oe88 of twant;Bizoj but AOt 

### to .XOO*dthirty-rive (86) the lIoeAe. fro &&LA ba Two Hunetred yifty Uolkrs (WQK)J i UpA oaoh additiOAa1 btOre ik OXOsa0 Or th1rt;I;i.e (35) but trot to rxoeod fifty (50) thn iioeneo Pet sball be live Hu~4re4 Uoliars O&O);
"8. UyOA caOh 84ditloAul StOr0 fA 0XUI.8 Of firty (so), tim lioeneo r.. ahrrfl bc 3Y.A Hurdred imty Uaifrrrs($7M));
"Such 

### ree8 are r0r the pcrloa of twolT. (A&) mnthn, an4 upon the issuance 0r any lloenae aiter the firet bay 0r January or aAy 

### one year, thsra shall bo coll.ot.4 suah rractional pert of the llOeABO hereinabove rix84 a6 t2. resvlinlnemoatho in 

## 488iionorable Georm ii. 

### Yhopmd, Page 4

the calendar year (InOlUding the month IA which auoh license is Irsued) bears to **the** twelve-Ioonthperiod.”
%ec. Da. mery person, agent, recelrer, truatee, fIra, corporation, eaaocIatIon and/or copertnarshlp 

### opening,establlahing, operating end/or omlnteinlng one or **more atOr**  or maro&ntIle **eatab** llshmmta nlthln this atate 

### underthe **aeme**

### generr3 rnrgesent and/or 

### ownershipand selling therein pnl equipment or epplIa~ao8 operated and/or used in oonnectlon with eny 

### l lectrIcol currant W/or natural pa and/or artIfIcIe1 gas whether the aamoba In oonAeotlon with tne aale of electrical ourmAt ur&/or netural gas and/or artlflolal gas 

### or not 

### andwhether such 

### person,rlra, agent, reoelvar, **truatee, oor**  poratlon aasociatlon arid/Or coputaerahtQ **be** dao 

### l Ageged L the buelneea of WrnIahIng aom publio utility aentoea or not ah811 per the lioenae roe8 hereinabove prescribed tar the privilege oi ope~lng, eat&blIahIng, operating rob/or melnklnIng aooh stores or mavmntIla aatAbllahzmnt8. Tha lloeaae fee herein preaorlbed la Appllceble to **thla** Sootlon, ahall ti,paid annually, and 

### ahellbe in 

### l QdltloA **to** the riling is0 

### prescribed la Seottons 8and4 0r tbia ut. The license fee hereia 

### preborlkd end applicable to this beetloonahall be ea rollmar
.*1. Upon one (1) otore tba lloenae fee ahall be One Uollbr ($1); , “2. Upon each fibQitIona1storb In 0x0*88 of 0110(I), but rI0tt0 OX0086 **tW0** (21, thO iiOOC8O rO8 

### l hbll be air Siollera($5);

“3. Upon each addItIona **8tOre** In **bxceaa**of two (a), but not to 0x0004 fir0 (5)‘ the lioe~ae 

### teaahall be Twenty-ilV0 Dollera (;)&b)t
“4. Upon each adc;Itlcnelatore in emmaa of rire (8), but not tq bxoeee ten (lo), tae lloonae fee ahail be Flrty uollara ($50); “5. Upon each eQdltIeAs1 atorb In 

### ex~eaaof **tan** (lo), but not to oxCOd twenty (80) , the llcenas ree ahall be One 

### Iiuidrad PIfty tiollera (31c)O) :

## 490

Honcreble 

### Oeorge ii. 

### dhe~pPrr&,Pege b

Upon aech ad6ItIonal ctore i:~**excess**or twentjbi20), but not to axceed thrlty-rive (35) the 

### licsnse fee shall be ‘figLfundredPIfty Do&a (8~50)i
“7. Upon each?addItIona store in exaees of thirty-five (33) but not to exceed fifty (80), the i.Icel;ts

fee shall be Five Euabz‘ed

### ?;oliara (#BOO);
“8. Upon each aP~~ItIona1otore In 

### axceap of fifty (601, the license rae ehall be &even Xur14rod rlfty Loliare (#75G).
suofi reefi623 r0r the period or twelve mntha (lZ), and upon the I~sm~ce of eny llceneo after the flret Cay 

### of January of any y ar, there shall be collected such fractional part of the lloenae herelnebove prescribed 

### aa the remalnfng wntha In the ccllender

### yoar (Iuoludlng the month In whloh auoh lIccuea la laeued) beare to the twelvr-month period, prorIded, hovmer that should 

### this Section Se and/or say pert thereof be for any reason declared void, unoonotftutlonai and/or Invalid, such Inv~llblty shctllnever be OonDtrued so aa to aifect eny other oeotion or aubaactIon, part or portion of t;,Is

Act acidshall In nowiae affect section 5 haroof but It IO the LagIaietIra Inteut that all or t,c rtuixiaer or this 1;ctshould remain in ruu for00 aad dib0t in 

### spite of an3 Inveildl~y 0r 

### this Aectlon 5raau&/o/or unp pert thereof ac8 the L&ahture would 

### imve Iqxoaod the tar 

### Lqoeed in 

### Seotlon 5 hereof regardicea of the vaildlty OT lnvalidity of ;iectlori516ad/or cay part tbr00r.
*Tilie

### 3eatlon nhail be conetrued 00 

### a AInltatlon upon 

### tiae exceptlou in &ectIon 5 hereof of bualneases uow 

### paping an ocoupatiou tax’ 1p4aeure4 by groaz 

### reoelpte.*f

It will be CotIced 

### that Soot&on 3 I.~poaea a 

### tax en 

### prraona operating *atoms or serceatlie astabllshmnta” but apecIfIoaliy srcludea certain bualnrs~~seamo&g which la “any busimeo now paylng an oooupmtion t&x .waaured by grass recQJlyts

.* Houdvar, Seation 6a plaara a tar on *reons operating “store6 or aercantlle 

### eatablIahaenta
. . . eelllng therein any 6quipzent xc appliWie88 OpOratSd RR&/ or rued in 

### oonnsotlon with an electrIoa1 

### currant anl/orXonorablo C+borgr li. Shbpi#rd, Page 6

natural gas and/or artlflolal gas.” The elsctriosl aoa gas 

### l g ulpssnt

sstabllsh~nta de8Oribod in Motion Sa are oleerlg stores 

### within the dbtinitlon of kisotlon7 (qufaa above) am3 rould be taxable under **S@tlon** 6 unlsm they ars ox0luaOa **by** the toros 0s sala 8eotion. By 

### l peoiiloa~4 a+ rorlblng oleotrlcal and gas sQuipa@nt sstabll8hmnte aid pleoing P tax 05 tholr operntfon In Section be the Leglslatur0 was bound to ham 005sla0rOa that they 

### werb l

0kiaOa froiptob prorisions of dotion 5. ‘S’ho only provision ln s0ti05 5 

### unabrdioh they 00ula be o058faOr0a 68 brine OX0luaOa 18 the prmlrlo5 Ox0iuai5$ *any bu8lnose sow Paying sn oooupatlon tax 

### semrured **by** gram rsoolpts.*

Prom a roadlng of both iisotionS an6 Sootlon Sa ~0 800 that the LaglolaturO ala mare then plaoo en eraoption to an ub8ptiOn in **ttib** AQt. It would bars boba 

### rntlrmly rs88ibls for the bglalatur* to hare **put** thu prorlrlon8 CC 

### 6botion Sa ln Seotlon 

### 5. 

### For uarplo, 

### lmealataly anor the UOOptlO5O 15 sOOtiOC4 8 it OOUla bwO pVOtlaOa OO (UI 

### l rerptlon to rala rxorptlous that pox’son oporatlng ortsb

### llahmbntrsoiling 

### thurolnl 100trloal and gar 

### l qulpm5t wwe subjbot to the tax presorlbsd ia aa sbotlon 6.

By way of analyals, it 1s apparent that t.tiLsgishare haa nt up in 2sctlon S a5a Ssotlon ba two sopsrats tU; OohodulOO ubcl haa taxed two aimrm type48 of bwinncraro8. ~8 pdntra out 

### a0~b tLu

# miti8mum**8ppuent4** hOa in nLad **that** tbo p1OcO0 or burineae tax& an&or SeotloroSa are not tU8a unam hotion 6 ana ~0 50t rtorer OS aerinea i5 sOotion 5. To tax as one oh&in all et the Itorob opuratbd by
ona oo~%pany,whlohara taxable wider f3MtiOn S antIaloo -u

### tionOa,would bo to awes8 the **tax** 

### at 

### a higherratathau proriaaa by tha Legislatum ror thb taxation 0s stores u&or iioetlonSs In that the grouping oi all of suoh **atorba** would provent the payment of thr fme 

### dollar 

## rbbon the rfrst ston tuba **waor** k30otlon&a, eto. Oiio aru uuablo to rtoa 05y authority 

### in the i&atfor the 

### taxing oi the 

### entlro group of 

### atorrra6 onb ohaln. Thor0 ia no authority 

### Sor auoh 

### grouping in &aotion 5a beaus* a sopuato and distlnot 

### tax l ohobulo has beon sot out by the LaglslatuSe for the tsxlng 

### 0r rtora8 

### oparatlng,underruch ;reotlon. The ract that the seheaula 0r I tax.8 to be pala wabr 30otlon 6 ma sootion Sa are t& same

mre olsarlg points oiltthat had tiaaiegid.&ture so adrOd to group all of the storer,in one ehaln wau the sltuatlon as ~8 hare hers it would ham boon slaple 

### for the 

### entlro t,ax to bO aeseseea under Section S with thhs

### proper prorleo aontainwl I5 the bxaoptlons.Honorable fhor(lo Ii. Sheppard, Pege 7

801~8ipmrtlon 18 r&iroA ooaorrnlu$ the 

### n8ult MOhOA in thia OPi~i05 b4OtiU84 Of th4 3A4t $~&I%kg&%k&15 motion 6a whloh reaae ao f'ollowr;:

V~lu 44otloA shall bo oonmtrwd 84 A lirrit4- tion 

### up on

the l x0eptlon8 i5 **~eotl05 a** 

### hereor or buslnemciar

### nowp&yin& an ooouyatlon tax samxrd by -8s rroalytn."
Otmlo~8ly, th4 4bovo Quoted paramaph was put into tbo 

### Aot to take oar8 of crnyapparent 

### or pceeiblr ooarllot kmnmon Seotion S 8nd Gsotlon 8a.

It has baa 

### l

u~~stod 

### that the elootrlaal axid

r l 

### l f#&MOnt EtOXW5 in QiMbtiOI3 A0 5Gt 06UU Within 451 Or 

### &l xseptlons of iiectltm5, and that **thururora** they us tuabls under ;iectim 5 15at8ad 05 urrber&eetlon &a. we wnnot ~68 with that coqtcntion bssause wo believe t&y am clearly ttu&bZe wAor ssotlon k by vla%ue of the wotia

or *aid saotion 66 whloh araorlb* tairui elsetriad. m4 ~8 

### l Qu@4@5t

UtOrUS

Very 

### S-gSGiiiOtiu. ie CLTa 4~8tba

hgh- &tare did net 1ntenU to tu thene fitoreu lzlboth &motion S upb *at&on &a a;ldtherab t4x tWm.Uoubla. Our 4aaolluloA i8 that tha i.4&Uture t& u&t&tth&t tha 4X44ptioa in SACtlon S whleh unya “a&y bwlnsea Iiow

### paying&II ooaqwtlon tu uasureA by groes r@Wlpt#” i5@ltrd4d store4 OQUMM by g&8 

### asat l leotrie oo~al~8 **boanu8e** MIA 4o~aganlor plA a @oar reOetpt8 **tu** under ActlOl4 70b0 Or the B4Vl4.6 Civil Statate of Texas 011tha &b8 and .IrOtriOitf ~~10; and tJn 

### b&8htUl'O Aid Mt wdllt 4u5i.i 4 004UmFhJ to OReA 4A 4p~~i4544 4toT4 **and** not br r4qSod to wy 4&w oh4in 4ton tax.8 on the operation or moh .storeb,anb in oxder to **be** are that taxer wore paId OA tt24oprratlon of 8~4n store8 4 wpuat* taxing sot, to-wit, &~OtlOn k, **W&S**Wl'itt5A i5tO th4 Act. **&WthU** WUOA Why U@ doubt ths su&$rstlon that tbeso 

### appltanor**rtomns** eirstaxable 

### waer seotto~ 5 iAd.aA 

### 0r &WStiQA sa 14 

### tint lr w Q&O0 suoh a emstruetlon on the -ot it would 

### rreult15 Ejeotlai8a tmt tnring 

### any';hbg WA being a~plrt~t~g~. 80 ShOUld a~014 ouoh a eonetrui2tion

### if y~asibla. Xn ths oaas of Amstrong V. **&at*.,.** lo@ Tax. Cr. II.Mb, SOS S. $i.817, the 

### murt MIA:

*It 

### 14 the aaty or tbr court to cons,trw the tarlou ortlol68 of the 8tatutr 15 l aoh 

### away a8 t0 give 

### dr00t t0 641 of tb8, if it 811nbe be58 without violsnos to mtatutory ooaetrrtotion

. . .*

@IOmro not unmindful of the faot that ln thr,ease of Hurt v.

### MonerublmGwraa 11.tihoppard,P40 83

Coopof, 130 POX. 4x5, 110 3. I+.(%dj 896, rdwriag to thla partla+m 

## l xaeptlt+t

in the oourt, in t.& Clmlo 

### store TU IAU, aaid byWayOr diOtU that "it 

### app4aTathUi.th Only bwlnosa whioh would bo 

### l xrpptod under thle provtsion lr t&t ot publishing usl 88lllna toxtbook8;" but uo believe thut th+ Le~irlaturo had in mind **thut** #tome of **the** kind under oon8idarutlon in **th$.s** oglalon would 

### some under thi8 exoe$tion, and ue 80 ho16.

I%@think it L8 apwr8nt that tha &~&.uture latontlod that the rtorer uader 

### &motion a aad the 

### rtoror unbr 308tiOa 8U b.O@WfdW@d l8 8OpUZUte Ohins. It i8 a rule Ot iv8Wthat ii pO88ib1. a OOlls~u+3tioa 8hou.ldb8 plaa.d WUl;atUt8 80 48 

### to.e;iVr df.Ot to the bgi8htW@'8 tib9 Tar. Jur. 186. nnothor aOn8i.dweitiM i8 ta8t 011idoJi, lo%, i&l M Att0Dn.J @8tlwti’8 Opinion WittOn br 

### A8818tWt AttOW8y O8ll8ra1&TOW 8 faOt situation th@ 8a@8 a8 th4 0114 inVOlVd iii this OpiniOll WB8 0Oll8f48rOd, WA& it W88 hold that 

### th4 OJWUtiOn

Ofl 18gtriO8i 8pp1iMO8 8tOT88 -8 tnxabl8 under SoOtlon 

### Sa, and t&t 8tor.8 

### taxeblo Udr lh'h;Ihb,urb 8tOTO8 taxable 

### UlUimr+W3tion 

### St uoZ* 8Owate

ih4 (UPa 8dV18.d thUt.yQU, ia ~WfOrmi~ YOU= dUtti8 u8 dnirtrator of th8 

### Texa8 Chain Store Tax Lau, have tOitow.0 that oplnlon. The Suprepr Court or the Unite& Stator, 

### 8praki;inl;

tht'OU&h JWtiOe 

### hl'dOS0, in the 0680 Or ~OPWOi&M 

### ultro~n CopIoany

t.United 

### i%at88, se6 u. 3. eOc* 53 sup. ct. w, 1 ’1 2. w. 888, 81ddt

“TtW it d.80 18 

### th8t UddJli8tlrtiVO 

### lWOtiO8. OOZb8i8tWbt 8Zi6 &MWUl~ WOhullM@Ob, Uil P Pot bo overtyrned 8X0*@ for 

### tory oo~ent l’8a800s if 

### the mope of the 608uWxd 18 lndeflnlto **and doubttu2.** 

. . . ,The pmOtiOa h88 pOOtiiUZ Bdght when it fnVO1V88 U t3O~t~3QO~4WOW OOtI8trUOtiOll Oi l 8tUtUte by the tic **oher&ed** with tha rO8&Wl8ibility Of wttin$ 

### it8rambinary %n feWian; Of IrukingtiW part6 ~orx 

### a30i4ntly and 8SOOttiyvhile they 

### are yet **untrio6 8nQ**  **new. -**  **In** th8 Oa88 of **Chtk** Vr **Atlantis** &aft, (writ of error nrfusod) th8 Aud in 8aid: wConacivln~, **wpeado,** Pip4 Line conpuiy, 1.M 3. 'la. Court or civil dppealo l t

tA4t tbslMgucl(L* or ._ . . 

### the Act 18 8usQ@.9tlbA.4 Of the Oou8tru0t1OSA tnat it eabraoaa titer a8 wall a8 intrastate bwineaa, it lWlif48t~ 18 CtOt 80 80 a8 DOt to

## 493

f8ator. -88, Zxpoolally lrcthir true 

### regarding revenue



### th0 Wkdlki8tr.StiPI2 Of whiah i8 und.r aonatant obeorvatlon 

### of the Legielatum. bee **39 Ter.**  **Zur., pp.**  **f?34-E38,**

### Lieotlone li% and lfS.* (Undaraooringcure)

L’Or

### the TBBBOAS il.rChldJOVo 8t&h WO aitira the &tJWY ‘hAW&i'ti O&'iAiOAOilthis 'JllMtiOndrtSd SFiy3, 'I. se 

### aacordln&ly hold t&at 

### thrY8tora6 you 

### Qswrlbr in rhick loo 

### rairfgerator8 8ro rold 3r8 taxable und8r s8otlon 6 wd thr SirOtdCri find g&8 

### l juip!MAt

8tOr8s you d68Wibm am tarabh under Stnctlon Sa, acd thet the stores under $%OttOP 3 hLU& th8 8tOlW8 UXid8r ZhHStiOAhi UOZl8titUte 86puata ah8lne

.

CmOil C. BotrOh A88i8tMt