MP. Coke R. Stevenson,Jr. OpinionNo. WW-816

Administrator Texas Liquor Control Board Re: Whether or not Art. 667, Austin. Texas Section 23;(d) of the Penal Code permits the tax on beer to be refundedwhen such beer is sold to an Individual

who has a contract with a NationalMilitary Establishment

to operate a concession

within the enclosures Dear Mr. Stevenson: of such establishment?

We quote from your opinion request as follows:

"Article 667, Section 23*(d), of the Penal Code of Texas, provides, to-wit:

"'It is not Intended that the tax levied in Section 23 of Article II of the Texas Liquor ControlAct shall be collectedon beer shipped out of this State for consumptionoutside this State, or sold aboard ships for ship's supplies,OP on beer shipped to any installation of the NationalMilitary Establishment, wherein the State of Texas has ceded police jurlsdiction, for consumptionby military personnelwithin said Installation, and the Board shall provide forms on which Distributors and Manufacturers may claim and obtain exemption from the tax on such beer. If any Distributoror Manufacturer has paid the tax on any beer and thereaftersaid beer is shipped out of this State, for consumption outside this State, OP sold aboard ships for ship's supplies,OP is shipped Into any Installation

of the,National

Military Establishment as referred to above, for consumption by military personnel therein,a claim for refund may be made at the time and in the
manner prescribedby the Board or Administrator. So much of any funds derived hereunderas ma be necessary,not to exceed two per cent (2$ 3MP. Coke R. Stevenson,Jr., Page 2 OpinionNo. WW-816

thereof, Is hereby appropriatedfor such purpose. The Board may promulgaterules and regulationsgenerally for the enforcement of this provision.'

"ThisDepartment interpretedthe above to mean that if the beer Is sold to, Invoiced to, or shipped to, and paid for by an installation of the NationalMilitary Establishment,

where police jurisdiction has been ceded by the State, that the State tax exemption should be allowed. On the other hand, if this merchandise is shipped to, invoiced to, OP paid for by a civilian concessionaire

who is operatingfor individual profit that the State tax exemption should not be allowed. -

"The situation in question Is where a concessionaire

who is a civilianand is not
a memeber of any branch of the Armed Services of the United States has been granted a concession to operate a snack bar in a National Military Establishment where police jurisdiction has been ceded by the State, The beer is served at this snack bar located in a bowling alley. The bowling alley is located within the area of the NationalMlLltapy Establishment. The concessionagreementprovides that the concessionaireshall not sell the products, services.,

and merchandiseof the concession to any person except those authorizedto be present in and utilize the facilitiesof the bowling alley in accordancewith applicable military regulationsor directivesnow in effect,

"In order to answer inquiriesconcerning the sale of tax free beer to an individual who holds a concessionin a NationalMilitary Establishment,

we respectfully

request your opinion as to the followingquestions:

"1o Whether OP not Article 667, 23*(d), of the Penal Code permits the tax on beer to be refundedwhen such beer Is sold to an individual who has a contractwith a RationalMilitary Establishmentto operate a concession within the enclosuresof such establfshment?Mr, Coke R. Stevenson,Jr., Page 3 OpinionNo. WW-816 c"

"2. Or, is the criterion for tax exemption not whether the purchaserof the beer is a civilian,but, rather, whether or not the State of Texas has any jurisdiction over the place where the beer is ultimately sold?

"Thesequestionsare not the subject of any pending litigationand your opinion is necessary in order that we may properly advise
a concessionaire

operatingon a Rational Military Establisbment where the State of Texas has ceded police jurisdiction."

A careful examinationof the terms of Art.. 667, Sec. 2& (d), Tex.Pen.Code, reveals no basis for your departmental interpretation. It is not required that the beer be sold to
a military Installation, but only that it be shipped tothe installationfor consumptionthereinby militarypersonnel. This proposition is clarifiedsomewhatby reference to the second sentenceof the questionedarticle,which states, in part:

"If any Distributoror Manufacturerhas

paid the tax on any beer and thereaftersaid beer. D .is shipped && any installation.

. . a claim for refund may be made."

As pointed out by Attorney General'sOpinionNo. W-354, three requirements must be met before refundsmay be made in
cases of this nature:

1. The beer must be shipped Into an installation of the National Military Establishment;

2. police jurisdiction ever the Installationin question must have been ceded by the State of Texas; and

3. the beer must be intended forconsumption by military personnelwithin the Installation. According to the facts set forth in your letter, all three requirements

have been met, Accordingly, refund should be made.

SUMMARY

Under the terms of Article 667, Section 234 (d), Tex.Pen.Code,the Texas Liquor Control Board shouldmake refund of taxes paid on beer shipped to a civilian concessionaire within aMr. Coke R. Stevenson,Jr., Page 4 Opinion No. WW-816

military installation wherein police jurisdiction

has been ceded where such beer is intended for consumption by military personnelwithin the installation.

Yours very truly,

WILL WILSON AttorneyGeneral of Texas

JNP:cm

APPROVED:

OPINION COMMITTEE: W. V. Geppert, Chairman

William T. Blackburn John Lawrence Hargrove Robert A. Rowland

REVIEWED FOR THE ATTORNEY GENERAL By: Leonard Passmore