296 

OFFICEOFTHEATTORNEY GENERALOFTEXAS 

AUSTIN 

Xoaorable Deoego 8. Sheppard 

Coslj7troll~r Of F-liblio Ao00unta 

Austin, Texas 

Dear sir; OplJaLon Bo 

LO the Tedsral Qorernmoat, 

*This dapartnmnt has dirsated Joeke -08. 

Co. that they are llabla 0az the tar." 

Joske Eros'. letter sontalas, in part, t-ho following faotat 
Bonmabla Gaorgs 9. Sheppard, png8 2 

*We are oontinulng to sxpexlenoe a ipeat 

deal of difficulty In ooansatioa ulth the oolleatlon or tares due under Artiols X of Houaa 

Bill 8 on aeles we mskr to the Uhited Statsa 

GorernReu t . 

*The Gorarnment ordara are aubmittsd to 

ua, me Pill them, end bill them for the amount 

of the male lnoludiq ths tax. In erexy lnatanoe 

they Zomnrd us a oheok In payment for the bill 

leas the amount of thn tax and snoloae with their 

aheck a tax exsnqtlon oertifloata. iEe repaatadlp 

adrlsed them that we hare eeoured Srom you l rulIlya. to the affeot that the atato oannot aoeept these 

tax exemption oertiiioatsth 

“Wo hav4 a vary axtsaclive file of oorreapondoaoa on Wia aubjrot. The paeition takea br the 

Oorornmsnt in all of thare lattara la the eama. 

llany of there matter8 are aOil unaottled. Wa are 

&ill malntafning ths poaitlon that the anount or 

the tax mat be paid, ainaa WI cannot aubdb the 

t8~ 0Ortiri0at08 $0 YOW 0rrie8. 

"At the mu&g*stion or ca taia IL Q. Brom, 

Flaaaaa Offlcrar far Randolph Ir 9 old a lotter waa 

wxlttan by him to the Comptrollsr 8anrral of thr 

United States on this aub eat. 

copy of ths lqtter nhlah d 

I aa anoloalng a 

aptBl.8 Brom #ant to 

. mo aa I&aroh 18th advising that the nattsr had baa 

refcmod to the Ooeaptrollar GUXar81, and, ala@, 

hia 1aOter of April llrt addreaasd to ma adVia 

ma of thb daaisian reaahed after hs had rsOa%V 3 

hia reply from tha Cantptroller tinera Of the 

United Statas." 

Captain Brown*s letter of April 1, 1943, Le 88 

sollow8r 

*'WI,th refsrenoe to our trl~phoflo eOntOrMtlon today, we will proaeed with paymat of YQUr 

lnvoiat under date of 1Pebruary 16, 1943, for the 

.aJnouJlt of fnvoloe leas tax. 

297 
298 - 

Honorable George T?. Sheppard, page 3 

‘Tour attention 18 invited to deoieion 

A-51249,~ Octobe 4, 1?3.3 ot Vbl. 13, pees 91 

of Oeaisions of Comptroller General, whI& 

provides thst any atate ‘. . , la wft,hout 

authority to tax the United Stetoa on auah 

purohaseo as may be nsoaaarrg fo? tha oonduot 

of the buainosa of the Fedwal Oavermaat.*~ 

SeatIOn 1 Chapter 184, Artlola X Aota 1 4l, 

47th Legislature (Oodkd by Vernon aa Artlola 70471 ? prolPidd#t 

w’RadIoa, oomnetloa, oardm; luxury sxolra 

tax; penalty ror nmking if3180 rspert 0r railura 

to report. 

~SeotIon 1. Baoh 

assoaIetlon, or f 

eraon, partnerahlp, 

oorjeat on rellisf at rrtall 

new radio8 OF now oommtloa, &ml1 maka quarterly on the flrst &ape of January, Aprll, Jull 

and Ootobar of saoh fear, a report to the tiptroller, under oath of the owner,, manager, or 

li h aorparatlou, a~ ofiieer Ohsrroi, #horIng 

the aggregate igrcw raoaipts f’rarp the anla ob 

MY o? the aborwmmd Iteas fOr thaw quarter 

next preceding; and shall at the sane tine pay 

to tha Comptroller a luxury asoise tsx equal to 

two (2) per aant of aaId gryoaa reoeipte as shorn 

by said report. 

*Every pmson, partnership, l 880oiatIon, or 

oarporatIon, selling at retail, playing oaram 

ahall make quarterly report ae provided abovo 

showlug the total number of pas&! or daaks o? auah 

aarda sold during the preaedlng quarter, and ahall 

at ths gsnrr t Ine ,m to the Comptrollar a luxury 

EXIST tax or rlvs f 5) aenta per raak or de& of 

euah ylaying cards 80 sold. 

*Hothing her&n ahall bs oonetrued a0 aa to 

require p,aymsnt of the tax on I;ross r*aeipta hmaIn levIad 4ozce than o$los cm the jzoaesde of the 

sals of the sam artlole of ,mrohar;dls@. A retall 

aale a8 used herein, mmns a SS~S to 0~1s W.hQ bws 
fw une or oonsu?optlon, and not for rarele. 

Croae readpts of n nelai mea8 tha rumwhloh 

the pumhaser pay8 or agram to pey for an 

ertfols or o-mdfiy bought et rats11 .aala.” 

The o~inlor. of ths Caarptrollu Oennrel, rr~tomod 

to in Captain Brown’ a letter, wa8 datsd Ootobar 4, 1933, and 

altad ee autharltg Panhandle 011 Goixpaaf T. State oi MiaoiroI.#, 277 0. 5. 218, 72 L. M. 857, 48 3. Ct. 451, 56 A. L. R. 

Ths oQrrucJtnssa Of the Pen&and14 oeau “14 nom opan to 

aeriaua qucstlon.m The tax imolted tn Coeyltrolles tknsrrl*a 

&eolalon wes e retell sales tax on the eonawar or purohaaa 

-not e vendolp'8 ker (es WI hate bsrcl), neeeure4 by &roe8 

r@oaipt& Thlr, r)e&mrkowrt hold in o&tion O-4403A that $h. 

ter in qusetion wan a ro8s rs99ipta tax, not a sales tsr, 

end was riot lrriod a&a f nrt the retail pwahamr. 

Tuhen4l.r Oil away 0. Nlaaiani~pl 9upra, lavolvs4 l elu dfreatly to the Vnltad $lataa f9r t&a nra of its 

Coast me:-4 PIret ia aerrfcs in tha (lulf of Yaxleo an4 ita 

Veterans* Xou ltel at (irrrlipmt. ft awae under a law at the 

mete ot N&u e rasppi whi9h proli6ad the8 'any p6raon 

gasoline, a!mU pay r0r~ the pr T loge or aJlga&lag in lloah 

in cha buauinear of diatrlbutly feaolior, or rotall 4%% 

buaineee u1 nxoiao tax ot ld (on4 oeat) er gnllaa u 

1 r 

oh* 

aale of gaaolino. . .* We oil cmapauy id not gay a%oa on 

ru4h 44144 to tia t&alto4 Ststrr, an4 tha State brought 8ulb 

Tha aorrgarrr 4@mUo4 011 ti~a e.rwn4 that Phi8 statute, an4 it8 

eaendaents, it aoastrurd to lx oaa taxes m ruoh aal~a, wao 

?4pU@lSUt to thu F.U.ral conllt E tut%oa. That 4Qat4nblon w44 

sustain64 in the trial 4emt, 4n4 tb,4 @tat6 4p oa,le4. %a 

&pram9 CttUrt of thr fraiOed 8Eat68 bald that t R b f3Wta We8 l!Ot 

math4 to wlleot the kx from tha mnhanar4 Oil Wwm UP= 

the garrolias arrld by It to tha Federal Covnrnasat~ 

f,@. Jurrtioc, Butler, who wrota the me3OT%tF optaim 

of the Court, aaidr 

*me rieht of ths ~bited Stat68 to nak0 

suoh pup&asses is 4eriVud frQlr tih4 &WI8titUtio:~. 
Ronorabla Deor(;e Xi. Sheppard, pa{;9 5 

The petitioner’s ri&t to itake sales to the 

United Litatas was not &Pen by the atnts and 

doea ilat depend on stats laws; it reaulta 

iron t,h6 aut!lorfty of the national government under the Oonetitution to ohooae its 

own means end 8ouraetb of supply. While 

Zdlesiaa~ppi may impose obar~ss upon patitloasr 

for the privilege of oarrying on tra4e that is 

aubjsot to the newer of the ntmts, it nay not 

lay eny tax upoa trfmaactions by whioh ths 

Wit&4 States SSSUTSIII the things desired for 

its governmantel purpoclea. 

The validity oi the taras alalum la 

to be determinati by the praotiral eftoat of 

Unforaemsnt in respeot of sales to the &svarnment . w3gi.m v. Covington, 251 c. s. 9,5, 192, 

64 L. 24. 157, 167, 40 Sup. DC. Rap. 93. I. 

ohares st the prescribed rat6 is tie&a, QD a@OwDt 

at wary gnllon aoqulred by,tha Vnitsd Statas. 

It la lmmtsrlal that the sellas an4 r.ot the 

puroheaa+ is required t3 report an4 m-&a payment 

to tha state. Sale 6nd ;urahase oouatituta a 

trenaaotlan by whiah the tax is suaaaureO aad on 

whlah the burdau~ smite. Thr ualount of Awlmy 

l lairaad b the stete rises at4 falls praalaaly 

as doer t ii a quantity of gaaollna so scoured by 

tha Covommut. It depsnda ioaebiately upon 

tha nuaber 05 gallons. The nuoeaaery opsretlon 

of there enaatmuta when so omrbrua4 is dirsotly 

to retard, iapede emd burden the erertiou bg tha 

&itm4 Statm of Its aonstltutlonal powers to 

oparata the fleet and haa;ital. N*Cullooln 12 

-%arylsnd, supra, 436 ( L. 3%. 608); Glllaepf~~*~ 

Oklahom aupra, 505 ( if 6 L. M. 3&O, 42 Sup..Ct. 

Rep. 17lj; Jaybird Min. Co. v. i;‘eir, 271,Ui 8. 

tW&, 613, 70 L. ~4,. lU2, lU4r 46 SUP. Ct. Rap. 

To use the number of ~;alloaa @Old th* 

Unlkd States CLB tn aearmre of the pTiVilS6S tax 

1s In substencs and legal effaot to tax the @al*. 

:Ie8tarn U. ‘felrg. Co. V. Texas, 105 IL 8. 260, 

26 L. Ea. 1067; Frlok v . Pennsylvania, 268 v. 80 

473, ~94, 69 L. ~a. 1058, 1064, 42 A. L. R. 316. 
301 

&fi Sup. Ct. Rep. 603. And that is to tax 

the tilted StnCes--‘bo 6xaot tribute on Its 

tramactlone and rpply the aame to the support Of the- Ptfit@. 

Vhs exsatlonlr doarnded from gwtltloaer 

lnfrlr&w it8 right to have th8 ooa8titutloaal 

lndapandenoe 09 thr United State8 in rsapsot 

Of SU&I ~xuoha668 re&8ia untramwlcd. Oeborn 

v. Bank of UnlteQ Statea, 9 ‘wheat. 736, 867, 

6 L. Ed. 204, 2345 Western U. Pole&. Go. t. 

Texas, rupra. Cf. Twraoo v. Thompson, 263 

U. S. 197 216, 6 L. lw. 255, 274, u sup. 

Utr Rap. is. ketitiOU@W im not liabls far 

the taxes olnlnmd.* 

out ltce aotlrltlcs in the Rats 02 :?orth Dakota. 

ThQ lhnk contended tlmt Ihs tax 0wa not be 

sonstltuthxmllg fitqmeod upan thn daalsr far any o&or vehlolr 

rue1 whlob it pnrehaaod frost bin for tha ppTpo8* or oarrglng 

PII It3 a~thorlzed'aotlritlo~ *rlthln the Stats, and that ~onwqusntly the dealer @@it oat ChrZEg9 the amunt ai rush tar aa 

a part of the prlae. Ths uefentbuha 

Auditor on the other hmd; oox-hssde d 

ihRoehfor&‘cnb 6ho State 

%it the zotor rshialo 

fuel soid by DqRaohfmd to the PbdadL Land pknlf au6t be lnaJ,uded in co+&&& the tax a&d OOSl8iBqUUltl#DeEoohford ’ a&&t 

i,nO1ti8 the l mo o nt of suah tnx in. the p?IOiL 

The Court mfdt 

i 
Honorable George H. Sheppard, pa&e 7 

of North Dekota hae the right to legoee upm 

e licensed dselsr in motor vehlole fuel 8 

lloaaee tax or thrae oante per fgarlan upon 

motor vehlole fuel eold by such dealer to a 

Paderal land Bank foi UN In autolnoblles owned 

by eeld Bank and opsrattwl by it inold8ntel to 

its eetlrltise in the State." 

II 

. . . . 

Tfhe dealelona of the Unit& States Supraae 

Court are bFndine upon thie Ooctrt a114 definitely 

eetablleh, (1) that 8 Federal Land Bank is an 

inetrumantality oi the national eovernncnt, areated 

by Oongrtaes, aoti8g within its oonetltutlanal powers 

to pertom 8uthorlmd governmen funotlone, aa4 (21 

that 8u8h bank 18 oonetltutlonall~ endowed with the 

eaae inaunity frora etatA kx~tion, that the national 

gorarnmnt itself weuht hate b a el adowed~rith, n if 

it had enmged in euah satirity dlreatly.* 

I 

. . . . 

“Jh the Aot proHdfag for the eetabltehaent 

oi 1Cedrral Lead Beak8 (?e&oral Farm Loan Act) 

t&me Ia a alwx intiootfon that ma1 eetetr *aP 

u&ad by a Federe:l Land Bank ln the oouree o? 

te operation8 wd+r th8 Aat eh8ll be eubJeot 

to taxationi and thsro Is a epeolfla doolarrtlon 

that *otery Federal land bask . . . ln8ludlng the 

capltel end reeerve or 8urpJ.w therein and t& 

lnotxae d6rlrad therclrxom, . . . flmt kwrtgagee 

ersuutetl to Federal. land benka, . . . an& fum 

loan bonds . . . end th6 laoom derlvwl thsre?rom 

ohall be exempt troa . . . State, mwfOlpa1 aud 

lwal taxation.' 

*It 18 reaeonstle to amew th8t rhsn GOngrew eald that a etats iol.ght not tax a Poderal 

Lend Bank, its oapital, rewrve o? ewplw, or 

the lncocue derived therefmsi, or tiret .~QY%W”ee 

sxecutsd to ths Benk, or ?am loen bond8 or &- 

00x0 derived therefro-r, it had in rnlnd &act and 
Honorable Gsorga IL Sheppard, pa&a 8 

dlsoemibls tazcea, end that It did not have 

in mind taxes imy:osed upon arid oolleoted rrom 

other persons with whom the Bmk might tram+ 

eet buslnsue, whtah night lndireatly result 

In mme sllghht inoreaea in the operating erpenees of the Bank. The tox in question here 

is not a fat upon a Fedora1 Iand Bank, or upan 

its Oadtal, r eser or ve l urplua or the lno~sls 

derived therefrom. fIelther 14 it a tax upon 

mortgagee exaouted to such Rank, or upon farm 

loan bonda, a~ upon th6 inoom derlted theratl-OS. The tax i% ore upon a dealer la motor 

vehicle fuel, who hne applied for, and who haa 

barn granted, a lbmsr under the laws of this 

State, to engage In bnske#a as II dealer la 

aotor vehlole fuel. 

The tax involvrsd hrre Is a tax irnpocred 

on dealers for t-56 privilege of engaging In tha 

burlnem of selling motor vahiole fuel, and the 

amount ai the tax lo measured by the nuaher ot 

gallons *used and sold’ by the dealer. It 1s 

not a tax upon a Pederal Land &mk or upon any 

function *hioh l aoh Bati ie authorlaad to periOtm. It irr not a tax upm any ot the powera 

with which the Bank is vented. The i&u& nay 

exsreias every ftanatlon and 

that it wau orsated to 

feriorm every rot 

8xaarc ae en4 perform 

without cne cent of lte fuade belag expended or 

one sent of its prorita be1n.g taken away hauau~s 

of this tax. The tax oamot be laid directly 

upon asp aetlvity 0r the Bank unlesr it ansagem 

in business aa a lieeared dealer of lootor vrhlola 

fuel in this State, aad the Bank was not Or8atad 

for the purpose of en(ga@9gln rash buainrso. 

‘f7ha only Way In whleh the funds of the Bank iitrrp 

ba ~expended, even indtreotly, ln the paymsnt of the 

tax will be if the Bank puroba8~ motor v@hiola 

rue1 from a dealar wha lnoludee the anowt of the 

tar in the salea prlae. But ii the operating exonsea of the Bank are inorsaeaa beoauae of the 

L npositi05 of the tax up05 a dealer Wan oboe the 

~hnlr purchases sotor vehlcl4d fwl, that effect la 

0~1~ inoldentel nn& remote end cannot be aaid to 
““Y 

Honorable George ii. Bhsppard, pge 9 

be a tax upon the Barik, Its oapital, remwva 

or 6lurplus, 

the Benk. 

or upon any of tho opsrationm of 

%sry tax laid upon l dealer will, 

of oourse, to some extent be reilected in 

the 

nhlo Ii 

rice whloh he ohargas for the co.moditp 

he aella. 

=. . . . 

" 

. . . the Buprwnr Court of the Unite6 

State6 hen held that en ooonpatlcan tax m~asursa 

by &roam inown@, rhero Inpo8ed by 8 &ate upon 

a aontraotor with the Uhitad EJtates, I# mot 

intall a m l tax apen the Taaerrl Goveracat 

aad its oporatlonr, eta UrorrQa the lqw~sItioa 

of the tax MT lntwoasr the 0-t to the 

3r 

V-aMate Jamar t. EZOTO Uontrqatlng Co., 2 I?. 8. 

ix, 160, 56 s. ut. 2~8, 62 L.~ Ed. 155, 172, u 

A* t. R. 318 

51 8. Uc. 27 I , 75 L. Rd. 496, 75 A. L. R. 9. 

atma ** Johnurn, 282 a. 8. 509, 

* 

. . . . 

The tax is geeoral qnd non4ircrrldaatory. 

Thr law lcapomr the sama llmnnre tax upon all 

motor vehiole fuel mid by l UOU.W~ deeloa 

without regard to whom the puraheaor may bo. 

Tn this oem the doelet (DoRoahfcsrd) ?Ixad 

the prioe whioh he charged for the gaaollar that 

he mold to the Luxl I&nk wf# ths tax in ralnd, 

that is, Ln Siting the priae hs added the abuut 


I 
lio,norable George 11. Shepporti, paw 13 

absolut% immunity) the proposition that, 

although the federal tar map inoreese ooot 

of state gov%xnm%nt%, it may be lmpossd Lt 

It does not curt.aIl fun&Ions s%o%ntIal to 

their sxI%t%no%. Expre%ol9 or l ub oIl%ntIo, 

it orsrrulsa a a%ntury o? preaedento.( 304 

0. 8. at page 429, 430, 58 EL Ct. at pago 

980, 82 L. Fd. at peg% l&42. 

*aTha sw%%pJng ohang* of ooaotruotIon of 

th% oonstltution’ , and’ th% applioatlon o? the 

ooatrollIng prlnolpler, rnnounoed la Oh% desloIone that deorasd suoh %h%ngo, 049~1 to 08 to 

leave. no subetantlal baaia for th% iul% annouuoed In Panhandle Oil Company v, Mleolooip 

ex ml, Knox. It o%%m% to u% rather that tha 4 

1 

deoIoIon, In effaat, hse been overruled. 

1 

. . . q 

"ZZm Isposition or the taz,Is not an 

ereroise or ari attempt to exismiee by ths o.tktcC. 

es any power *by taxation or bt 

P 

erwlae, tocr%- 

tara, impsde, bwdbn, or In cuiy.,~pepnbl oontrol 

the operation8 ot’ (4 Wheat. $t pages &2+437, 

4 L. Isa. at pages 607-609) The Foboral Farm 

Loan Aaa. If regard *b% ha8 to rabatanas and 

dlreat effeoiys’, and ‘m%rel9 th%orsti%al eon0egtlons of iatt3rffmmab rfbh tha tuno0fono of 

i30~4m~iaent' be lafd %%I&,% ‘theq% Lo no wSilb:mt 

ground for holding that the d$$ct upua the gorsrnm4nt is other than ixidfreot aniLrsm6tr2 

at pages 386, 387, 5S.S. ct. at 

L. .Fid. at page 914. Ths Imp001 tp” 

gee 62,,3w*si 

on of the tut*upon 

a dealer for @aaollns mold by hfa to a Fedora1 

Land Ban&c *nsither.preoludm nor thrsatans unr%dsonrbly to obatruot any funotloa e%e%ntl~al to th6 

eontimed slfatenas’ a? the Bank. ETsIth%r doe% 

It operste to oontrol, hlndlbr, or Impedo the Bank 

In lit;9 psrZormfmo6 of an9 ~e%r*la% that It *8% 

%at&blIIshed to psrform ror th* govwm3ntc If 

any of tha burdem oi the tax that I8 l.mpfkti upon 

the d%al%r indirectly reaehee the Land Bank that 

Honorable George Ji. Sheppard, pags 15 

and consequently reduce that government’s 

revenues to a proportionate extent. ThlS 

view is in harmony with the oases hereinabovs ofted which reaognlze and define the 

inherent ltitations or the ,dootrine of 

iamuIl~ty, and r0ii0ws the pronouno4m4nts 

OF the Supreme aourt of the Unltad States 

la its more reoent decisions formulating It4 oon- 

.oluslons on the epplloebllity of the prlnolplo 

anU Its limitations In relation to other taxing 

%.Ut:;i 58 S Ct 206 211 82 L Ed i55 

James P. Dravo Contraotlng Go. 302 

14 A. L, ‘R. ,G, r~ir0Ga ingsilae’Mas& co: ‘ 

3no*, v, Tax Commlselon..of Washington, 302 0. 9. 

186, 58 S. Ct. 233, 82 L. Ed. ‘187, and Atkinson 

vr Stat4 Tax Commlssfon or Oregon, 393 U. S. 20, 

jta. Ct. Q9, 82 La Ed. 321, Jan. 31, 1938. 

“We are awar that statements *oh night 

be said to support a oontrary 4oaolaelon have 

b44n +ade in the oases of Panhandle Oil Co. v. 

Misalsalppl ex rrl. Wnox, 277 0. 8. 218, 48 

S; Ot. 151, 72 L. Ed. 857, 56 A. Lv R. 583, 

fadian Motooyol4 Co. v. Unltail SOates, 283 0. 8. 

570, ‘51, 0. Ot. 601, 75 L, Etli 1277, and Graves 

v. Texas Uo., 

L. IL 1236. 

298 U. 9. 393, 56 S.-t%. 818, ‘80 

Those oas*a involved, respeotlvely, 

alar or )d[issisaippi imposing an exoia4 tax 0r 

one o4nt par gallon upon the sale of gaaollne, 

a statutr of Maasaohueetts Z4vging an exoisa 

tax on sales and a gasoline tax aot of Alabama. 

*In the ease of Je~31es v. Dravo (Iontraating 

oompsny, supra, the oourt had beroro it ror oonsldaration the Gross Sales and Inoome Tax Law of’ 

Weat Virginia, Code W. va. 1931, ‘11-13-l 8t sap., 

as amended dots 1933, let Ex. Seas., o. 33, whfoh 

provided ror annual privilege taxes on ao~oount or 

~bueFnae4 and other activities.’ ~That law imposed 

upon the oontraotlng oompanr a tax equal tom 2 per 

cent. or the grost inoome from Its bueinees. The 

312 

Honorable George H. Sheppard, page 17 

and further that theretofore thoee oame 

had been distlngulehsd and must be deeaed 

limited to their partloular islots. Notwithstanding the holdlnge or exprearsious in the 

oases distinguishad, it must here be eonolud~ 

tbnt a proper OOllStrQctiOn of the Ratail Sales 

Pax Aot of Callrornla 18 that tha tax IS not ill 

the rale, but rather that it 1s a tax in the sama 

aategory aa property and oxoise taxes payable by 

an lndapsndent oontraator engaged in the buslneaa 

of retail sales whlah, although they am reileotad 

in the higher aost of the produot or oommditg 

offarad, must be aonsidered msralp as a neoessary 

expense of aonduotlng the business. St is a tax 

oouiputsd on the gross rscelpt,s frwn thp~: oonduct 

of the. bnsinesa at the retail merahiquti,:, Eaaantially, as intimated fn Metaa1.i k E$‘dp v, Mitchell, 

supZa there does not appear to be ruiy sound basis for 

a di&otlon beoaans the reosiptr affording the 

nieasure of the fax are derlred from thr rstafl 

business oonduoted by an indspendent ocrlltraator 

or aerohemt, rather than from tbo nrle of 8ervlo68, 

where otherwiee the larpblrltioa %r nonriienrkmlnat~y. 

Clearly the icnpo8ltion Of a prirllage tax an the 

retailer of ooaooditlslr doe8 not Intartar with the 

pewer of the garernamt to borrow money; nor doas it 

aiteot in any eubstautlal siannor ths eftiolanoy aI 

itrr agenog in the psrtomumae of Its dutielr, nor 

the ability of the persona taxed to dlsoharge their 

oontraotual obligations to the gooarnmant, nor the 

ability of’ t+he government to proomre the sqloes 

of private individuals to aid theat la their undertalringa* 

Tollowlng the path pointed by tha oourt in 

thr Dravo Case, uu conolude that the tax on the 

retailer unds~ the Rata11 Sales T!ax Aot Of this 

stata lmposad on the basis of a return whiah inalludes receipts dsrlred from salea of tangible 

personal property to ths bank, a fe4dsral instrumantallty, doas nat unduly burden the Saileral 

government nor intsrfere with the axarOi60 Ol’ th6 

governmental t unotiona Alelagated to ita instrumantality, and was therefore Yalidly ilapoSa.” 

314 

Haaornbl~ Gborgo p.. Shwpatd, pa@* 19 

not in tact the *purahars?’ within &ha meaal~ of thr tex 

stntute.w Soo l&C A. L. R. 621 itw a! uxod.leclt Mnotatioa. 

In rlar or the above l a 8h o r rro itl y, r* o? #a. 

opinion that you carisot1y 8dVti6d ;loalcr 3x08. CO. that it 

ra6 liable imp the tax. ‘84 am further ot tha o&ion tk8t 

the Comptrol~et c?ensrel~a 4edlalon is nrrt arpllanblo to thd 

tads involved tn your o~lnioa nqaert. 

Ruimag thst the above fully