## Txm Am- GENERAL OF TEXAS GERALD C. MANN Aus~ ii. TEXAS Y3xwx- ATTORNEY GLCNERAL

Honorable George H. Sheppard Comptroller ofPublic Accounts

Dear Sir: Opinion No. O-441 5 Re: The exemption ofmotor vehicles purchased by Defense Plant Corporation from the 1% retail sales tax. Inyour letter ofFebruary 10, 1942, you direct our attention to **our** Opinion No. O-3797, holding that motor vehicles purchased and owned by instrumentalities ofthe Federal Government are not subject tothe 1% tax levied on the retail sales ofmotor vehicles by Article VI, House Bill 8, 47th Legislature, and request our opinion as towhether or **not**the Defense Plant Corporation is aninstrumentality ofthe Federal Government, such that **motor** vehicles purchased by itwill not be subject to said tax. You~also advise that in some cases the motor vehicles are registered inthe name of acontractor who is building adefense 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 tothe Tax **Assessor** Collector in order for .him todetermine whether or not the tax should be paid.

Defense Plant Corporation apparently was organized under Section 606b, 15U.S.C.A., and clearly is anagency of the Federal Government, created

“in order to aid the Government ofthe United States in its national defense program.” Section 610, 15U.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).ofTitle 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 ofthe corporation shall be subject toState, Territorial, county, municipal, or local taxation tothe same extent according toits value 

### as other real property lataxed. The exemptions provlded for inthepreceding sentence with respect totaxation (which shall, for 

### all **pur** 

### poaea, bedeemed toinclude sales, use, storage, andpurchase taxes) shall be construed to be applicable not only with respect tothe 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 topay the tax levied byArticle VI ofHouse Bill 8. 47th Legislature, on motor vehicles purchased by it.

.. We now direct our attention toyour second question., Attached to **your** opinion request is aletter fr,om anauditor ofDe~fensaPlant Corporation, Mr. M. R. Burson, inwhich he plainly states that ail automotive equipment of the Defense Plant Corporation is held and registered in its own proper name.. Ifsuch be true, itwould follow as amatter ofcourse that no vehicle standing **in**the personal name ofthe contractor is entitled to registration witbout payment ofthis 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. Incase Defense Plant Corporation hereafter does assert such ownership and exemption you may so advise us andwe will then be glad to render our opinion onthe question as towhether 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 GRL:db:tiw APPROVED OPINION COMMITTEE BY BWB CHAD&AN GRL:pm