TEZE Aassmy GENERAL: 

OF TEXAS 

" GIBALDC.~ 

e '. 

Ausrrxiw 1s. TJEXAE 

Honorable George I?. Sheppard 

comptMller of Public Aaoouata 

Austin, Tears 

Dear 8irr opinion no. o-2146 

&I (1) TurIdlitjr of priror under 

Arti 70471 giha amy at 8 horse 

rhuw; (2) Admickiqm8 tit:* hono 

rrhm under Art. 70478-19, VAC.8. 

We reosived yonr,l&ter dated l&r& 28, 1949, r~usstlng our opir 

ion on sewral queetims Bassd upon the faots oontained in P lettar from 

the Program Chairman oftie Dallas Spring Horse Won. m quote fran yopr 

latter as follows: 

,*A oharityherse s&vwas held in,~%llaa re-tly for the purpose of raining nmds for a Finnish Relief Fund. &bi~6iOlWOf P.00 pm person wore 

oollkoted and prireo~,amounting to $10,OG&OO were giw8 to, fhe mers of', 

the winning horses antered in thb various olasses ,of tilbs. An aritombile was giver amay bymsrns of a drawing oonfest. 

Yamattaahing a lettar fromthe Chairmsr oftha ProgramCcmittee of the 

horse shm nbioh e+alns in detail the manor of oonduotiagthe~show +M 

the methods used ia mvar+Jingthe prize&" 

Ik, quote fromthe enolosed letter‘mitten *Mr. UP. Y. Qmem&d~ 

and addressed to you+ as follomr 

nReplying to yourletter of,ldaroh 20 to thebest of q hbulmdge the 

Charity Horse Show nus operated as follows: 

"ZQ-st priaes of #lO,OOO mm set up for the winners ofthe various alas-. 

sea, it bsiag neoessary to gim cash prires in order to attraoh entries 

and insure the 8uooess of the shop. In addition to thescorkh prizes, 

various trophies were, givea,& of which were donated by people interested in the show a" it8 8uoo088. 

*Admissioq totb show ~8~ charged oa the basis of $1.00 per person for 

eaoh performmae. In addition season boxes were sold, of which I 

believe there mre om htmdmd, thosa boxes selling at #lOO.pO - 801~ 

few et &io.oo. 

'The Comnittee i& oharge antioipated that the reoeipbs trcmthe stab of 

bores, and the entraoe fees reoeived, and &tall rents from thou l 8tsring horses, muld be more thaa enough &may to proride fortha aish 

prizes aadforthe xeomm~r~r expexise~. Refit fromtheShmnr8 oxpeot-' 

ed tobe derived fromthe gemtil tioket sale, from concessions, and 

from&mrenir Progmms~ 
Hon. Geo. H. Sheppard, page 2 (O-2146) 

*Most of the beverage houses, oandy distributors, and other people donated 

their merchandise to the Show in order to swell the net receipts from the 

oonoessions standpoint. 

"The Souvenir Program,nhich is a feature of every Home Show, inaamuoh as it 

is neosssary for the spectators to have a prograrn~in order to followthe peformames, was financed by the sale of advertising spaoe,md as you know most 

purohaeers of spaoe looked on it as a,oontribution rather tham as ocmnneroial 

advertising. 

"Ta order to swell the sale of the programs themselves, aad they were sold at 

26+ saoh, it-was suggested that we get a group.of mm to giw us the monsy to 

m the automobile, lhioh was done2 and the automobile was then purohaaed at 

ooat or appraximate:oost. (P.each program was a coupon which aartitled the holder to a ohanoe at the autmobile, aad all coupons were deposited in a reaepta018 a& one drawntherefrom, the oxmr of that ooupon bsing the reoipient of 

the automobile. 

*YOU uaderstand, of aourse, that all pmoeeds, above expenses as set out herein, 

mre for tht, befit of the Finnish ReliSf Fund. It was not rWiuir& tbt~the 

tinner should be present~at the dradng, amd in fact it nas not required that he 

be Resent at nny performance of the Show, therefore he was not mq&ed to buy 

my admission ticket to the Shm, but paid 26 cents for progm.” 

Based Uponthe aMe stated faots, you request our opinion oa the 

following questions: 

1. Is the autcmoblle, givea away in oonneotior, with the Dallas Spring Horse 

Show, subjeot to the 2lY$ award tax levied by &tic10 7047f, V.LC.S.7 

2. Are the prizes;given to the owner8 of the winning horses,,subjeoto the 

20% awaer tax levied by Artiole 7047f, supra? 

.~~ 

3. Arcthe admissioa charges subject to the admission tax levied by Article 

7047a-19, V.A.C.S.0 

&-tiole 7047f, reads in part a8 followsr 

"(a) Ebery person, firm; or oorporation oonduoting a theatre, plaoe of amusement, or any basinees enterprise in aomecticm withthe operation of which a 

prim in the form of money or somthiag of value is offered or giveato me or 

more patrons of,suoh tbatre, plaoe of amusement, or biisimm eaterprize, pad 

not given to all patrons thereof paying the same charge for any oertaia sumioe, oomnodity, or entertaimnent, shall ma@ a verified monthly report on the 

twenty-fifth day of each month to the Comptroller of Public Aooounts of the 

State of T-8, showing the azwunt of money so given ia prizes, andthe ~alua 

of all prilss or awards so given in oolaneotion withsuch business during the 

next preceding monfh. 
Hon. Gee. H. Sheppard, page 3 (O-2146) 

*(b) There is hereby levied a tax equal to Imen* per co& (2%) of the value 

of all suoh money, p&es, and awards given in aonnsation withthe operation of 

each and all of the foregoing bxiwss enterprizes, and at the tims of making 

the report tothe Comptroller of Fu&lio Aooounts, the owner or operator of any 

..suoh business shall pay to the State Treasurer such tax upon the total amount 

of money, pxYmes, and awards so giver during the next preceding month. . . ." 

This Departmant has held that the operation of a theatre or a 

plaos of amuseme& must be operated as a "business enterprissw in order for the 

prize to be taxa% uader the statute in questioa. Our Opinion No. O-1689. It 

appears fromthe heretofore melntionad facts that the horse shan was operated, 

not as a busin 888 enterprise, lut as a benwolsnt or charitable enterprise. 

H& conolude, therefore, that neither the Dallas Spring Horse Show, its members 

nor its officers are liable for the 2% award tax on the automobile. 

In answer to your second question, we are of the opinion that the 

prfres or awards giwn to the owners of the winning horses are not sub@& to the 

2% award tax for the reason that the horse show was not oonducted as a "business enterprise" as that term is used in Artiole 7047f, supra, and for the further reason that the persons who mere awarded tha prizes and awards nure not 

npatrone thereof paying the same ohargs for any oertaim ser~ioe, oommsodity; or 

spltertainment* within the rmaning of the above article. See Conferenoe Opinion 

No. 3026. 

In answer fo your third uestioa, wa are of the opinion that you 

oorreotly advised the officers or mom zs rs of the Dallas Horse Showthat the 

admisSion tar is not applioabla to the admissions oolleoted for the reascas set 

out in our Opinion Ho. O-820. 

ok, trust that this is the iSformation desired. 

Yours wry truly 

ATTORXdY GE-SEEAL OF TEXAS 

By /s/ Glema B. Lewis 

Isr8wregw 

Glenn B. Lewis 

Assistant 

By /s/Lee Shoptaw 

APPm APFLI 19, 1940 

/s/ Gerald C. Wan 

ATlWkWY GENERAL OF TX@