Honorable George H. Sheppard 

Comptroller of Public Accounts 

Austin, Texas 

Dear Sir: Opinion No. O-3709 

Re: Are gross redeipts, earned 

wholly within an incorporated 

city or town by a "motor 

carrier", holding permits as 

a contract or s ecial commodity 

carrier, under E hapter 277, 

Acts, Regular Session, 42nd 

'Legislature, subject to an 

occupation tax under Article 

14, H. B. 8, Acts, Regular 

Session., !+7th-Legislature? 

Your lstter of June 11, 1941, submits _ for our opinion the above 

question. 

Article 14, Section 1 (a), House Bill No. 8, Regular Session, 

47th Legislature, levies,the following.occupational excise upon 

gross receipts: 

"Each individual, partnership, company, association, or 

corporation doing business as a 'motor buscompany' as defined 

in Chapter 270, Acts, Regular bession of the Fortieth Legislature, as amended by the Acts~of 1929, FirstCalled Session 

of the Forty-first Legislature, Chapter 78, or,as 'motor carrier' 

'contrac-t carrier' as defined in Chapter 277, Acts Regular - 

gzssion of the Forty-second Legislature, over and by use of 

the public highways of this State, shall make quarterly on the 

first day of January, April, July, and October of each year, a 

report to the Comptroller, under oath, of the individual, 

partnership, company, association, or corporation by its president, treasurer, or secretary, showing the gross amount 

received from intrastate business done within this &ate in the 

payment of charges for transporting persons for compensation 

and any freight or commodity for hire, or from other sources of 

revenue received from intrastate business within this State 

during the quarter next preceding. Said individual, partnership, company, association, or corporation at the time of 

making said report, shall pay to the State Treasurer an occupation tax for the quarter beginning on said date equal to two 
Honorable George R. Sheppard, Rage 2, O-3709 

and tw,o tenths (2.2) per cent of said gross receipts, as 

shown by said report. . .' 

In order to clarify the scope and meaning of the term 

"intrastate business", the receipts from which are made 

taxable under the above act, the 47th Legislature, by House 

Bill No. 1039, provided as follows: 

"The term 'intrastate business' as used in Article XIV, 

Section 1 (a) of House bill No. 8, Acts of the Regular 

Session of the Forty-seventh Legislature shall mean and apply 

only to that portion of'revenues derived from transportation 

subject to the regulation of the Railroad Commission of Texas." 

The tax levy in question is upon the gross receipts of each 

individual, partnership, company, association or corporation 

doing business as a "motor carrier" or "contract carrier", as 

defined in Chapter 277, Acts, Regular session, 42nd Legislature. 

The definitions referred to are quoted, respectively, as 

follow3: 

"'The term "motor carrier" means any person, firm, corporation, 

cornparry, copartnership, association or joint stock association, 

and their lessees, receivers or trustees appointed by any court 

whatsoever owning,controlling, managing, operating or causing 

to be ,sperated any motorpropelled vehicle used in transporting 

property for compensation or hire over any public highway in 

this State, where in the course of such transportation a highway 

between two or more incorporated cities, towns or villages is 

traversed; provided, that the term "motor carrier" as used in 

this a-t shall not include, and this act shall not apply to 

motor vehicles operated exclusively within the incorporated 

limits of cities or towns. 

'1 The term "contract carrier" means any motor carrier as 

herein above-defined transporting property for compensation or 

hire over any highway in this State other than as a coinnon 

carrier. I" 

Although it is not definitely 80 stated, we shall assume, for 

purposes of answering your question, that the receipts upon 

which the question of taxability is raised, are receipts earned 

solely in the carriage of property from one point within an 

incorporated city or town to another point within the same 

incorporated city or town; and that it is not intended to include, 

on a pro rata mileage basis or otherwise, any part of the gross 

receipts or compensation earned and collected by a contract or 

special commodity carrier, for the transportation of property 

over the public highways, bstween two or more incorporated cities, 

towns or villages. 
Honorable George H. Sheppard, Page 3, O-Ja 

Under such construction and limitation of the facts, we do 

not believe a person, firm or corporation carrying property 

for compensation or hire, under contracts of carriage 

originating and ending within the limits of an incorporated 

city or town, is thereby constituted a "contract carrier", 

"special commodity carrier" or other "motor carrier", as-these 

terms are ,above defined, even though the same person, firm or 

norporation, using the same motor vehicles, is additionally engaged fn transporting property for compensation 6r hire over 

the public highways, between two or more incorporated cities, 

towns and villages, under permits issued to him or it by the 

Railroad Commission as a "contraot carrier" or "special commodity carrier", under Chap. 277, Acts, Regular.Session, 42nd 

Legislature. . 

The gross receipts derived from this latter aspect dS the 

business would be taxable gross receipts, under Article 14, 

H.B. 8, Acts, 47th Legislature, because earned by such person, 

firm or corporation as "motor carriers", under the statutory 

definit'ion, subject to the jurisdiction and control of the 

Railroad Commission and therefore derived from "intrastate 

business" aa defined by H.B. 1039, Regular Session, 4'7th 

Legislature. But gross receipts of the same person, firm or 

corporation, earned wholly from the transportation of pr,operty 

from one point in any incorporated city or town to another point 

within said city or town would not be taxable. Such gross 

receipts would not accrue from "intrastate business'& as 

statutorily defined because such strictly intra-city operations 

would not be subject to the jurisdiction and authority of the 

Railroad Commission, under the following proviso or exoeption 

to the term "motor carrier", as defined in Chapter 277, Acts, 

Regular Session, 42nd Legislature: 

"Provided, that the term 'motor carrier' as used in this Act 

shall not include, and this Act shall not apply to motor 

vehicles operated exclusively within the incorporated limits 

of oities and towns." 

Wa understand that the departmental or administrative inter- 

;;;;;;ion of Chapter 277, Acts, Regular Session, 42nd Legisby the Railroad Commission is to this effect, and this 

fact i: entitled to great weight in support of our Conclusion. 

Trusting the foregoing fully answers your inquires, we are 

Yours very truly 

ATTGR~NEY GENERAL OF TEXAS 

PMN:lh/cg s/.Pat M. .Neff,-Jr. 

By .~ ".~~ 

APPROVED AUGUST 1, 1941 Pat M. Neff, Jr. 

,y/ CJrqv,sr Sellers Assistant 

FIRST A:BSISTANT ATTORNEY GENERAL