Txm Am- GENERAL 

OF TEXAS 

GERALD C. MANN Aus~ ii. TEXAS 

Y3xwx- ATTORNEY GLCNERAL 

Honorable George H. Sheppard 

Comptroller of Public Accounts 

Dear Sir: 

Opinion No. O-441 5 

Re: The exemption of motor vehicles 

purchased by Defense Plant Corporation from the 1% retail sales 

tax. 

In your letter of February 10, 1942, you direct our attention to 

our Opinion No. O-3797, holding that motor vehicles purchased and owned 

by instrumentalities of the Federal Government are not subject to the 1% 

tax levied on the retail sales of motor vehicles by Article VI, House Bill 8, 

47th Legislature, and request our opinion as to whether or not the Defense 

Plant Corporation is an instrumentality of the Federal Government, such 

that motor vehicles purchased by it will not be subject to said tax. You~also 

advise that in some cases the motor vehicles are registered in the name of 

a contractor who is building a defense or army plant and that the contractor 

claims that the vehicles are actually owned by the Federal Government, and 

you ask us what evidence we think,should be submitted to the Tax AssessorCollector in order for .him to determine whether or not the tax should be paid. 

Defense Plant Corporation apparently was organized under Section 

606b, 15 U.S.C.A., and clearly is an agency of the Federal Government, created 

“in order to aid the Government of the United States in its national defense 

program.” Section 610, 15 U.S.C.A., reads in part: 

“Any and all notes, debentures, bonds, or other such obligations issued by the corporation shall be exempt both as to 

principal and interest from all taxation (except surtaxes, estate, 

inheritance, and gifts taxes) now or hereafter imposed by the 

United States, by any Territory, dependency, or possession 

thereof, or by any State, county, municipality, or local taxing 

authority, except as provided in Section 742a (a) .of Title 31. 

The corporation, including its franchise, its capital, reserves, 

and surplus, and its income shall be exempt from all taxation 

now or hereafter imposed by the United States, by any Territory, 

dependency, or possession thereof, or by any State, county, 
Honorable George H.,, Sheppard, Page 2 (O-4415) 

municipality, or local taxing authority; except that any 

real property of the corporation shall be subject to State, 

Territorial, county, municipal, or local taxation to the 

same extent according to its value as other real property 

la taxed. The exemptions provlded for in the preceding 

sentence with respect to taxation (which shall, for all purpoaea, be deemed to include sales, use, storage, and purchase 

taxes) shall be construed to be applicable not only with respect 

to the Reconstruction Finance Corporation but also with respect 

to (1) The.Defense Plant Corporation, . . .* 

From the above it is e.vident that Defense Pi& Corporation may 

not be required to pay the tax levied by Article VI of House Bill 8. 47th Legislature, on motor vehicles purchased by it. 

. . 

We now direct our attention to your second question., Attached to 

your opinion request is a letter fr,om an auditor of De~fensa Plant Corporation, 

Mr. M. R. Burson, in which he plainly states that ail automotive equipment of 

the Defense Plant Corporation is held and registered in its own proper name.. 

If such be true, it would follow as a matter of course that no vehicle standing 

in the personal name of the contractor is entitled to registration witbout payment of this tax. At least until and unless advised by Defense Plant, Corporation that it actually owns such automobiles and asserts the exemption. we think 

tbat these claims for exemption made by contractors should be denied. In case 

Defense Plant Corporation hereafter does assert such ownership and exemption 

you may so advise us and we will then be glad to render our opinion on the 

question as to whether exemption from the tax may be allowed. 

Yours very truly 

APPROVED MAR 6. 1942 

/s/~&rover Sellers 

ATTORNEY GENERAL OF TEXAS 

BY 

FIRS.T ASSISTANT /s/ Glenn R. Lewis 

ATTORNEY GENERAL Assistant 

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APPROVED OPINION COMMITTEE BY BWB CHAD&AN 

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