Honorable George H. Sheppard

Comptroller of Public Accounts Austin 11. Texas Dear Sir: Opinion No. O-6138
Re: State Tax Board may certify intangible assessment found on carriers engaged inbusiness as common carriers on January 1, 1944 under facts stated. Your letter of July 31, 1944, requests an opinion relative to the assessment of atax onthe intangible assets ofthe busses and trucks as provided in Chapter 4, Title 112, Revised Civil Statutes ofTexas as amended by House Bill 8,Acts ofthe 47th Legislature.
We quote the second and the last paragraph ofyour letter as follows:

“A re-check and investigation has been made ofthe RaiLroad Commission records and certain facts have been developed therefrom. A few ofthe truck lineswere omitted from the minutes ofthe State Tax Board dated June 20, 1944. We find that some ofthe truck lines’ certificates have been transferred to a new concern purchasing these certificates. The purchaser received the seller’s authority after January 1, 1944. However, the business was inoperation on and before January 1, 1944, with neither theold nor the new operator being assessed. In other cases they had received atemporary certificate to operate pending the issuance ofthe final certificate, the final certificate being issued after January 1. Other carriers had filed their applications and clearly indicated that they were already operating, but convenience and necessity had not been proven, and the Railroad Commission had not issued their certificates until after the first ofthe year. It might be stated at this point that we made no attempt to develop a case ifthe certificate was issued after the first ofMarch, 1944, and inno case did we even list aline that had filed an application prior to January 1.Honorable George H. Sheppard, Page 2 O-6138

I.

. . .

“Please advise me whether or not the State Tax Board will be allowed to certify any intangible assessment found on the carriers that were constructively engaged inbusiness as a common carrier at January 1under any or a11ofthe circumstances as mentioned in the second paragraph ofthis letter. Ifyour answer to this question should be negative, then advise whether or not the assessor may back-assess these intangible values after he has been notified ofthe amount by the Comptroller ofPublic Accounts, or by any other method that would enable him to discover these values.” We believe that the Attorney General’s opinions numbers O-3546 and O-4441, both ofwhich were addressed to you, when considered together, substantially answer the question here stated. In the opinion which follows, we are relying upon these previously written opinions and have attempted merely to combine those portions of said opinions which most directly relate toyour question in order that you may have the substance ofsuch opinions before you in amore convenient form.

Article 7105 ofVernon’s Civil Statutes ofTexas ss amended by Article 13ofHouse Bill 8,Acts 47th Legislature, Regular Session, provides:

,A ’

., .each ‘motor bus company,’ as defined in Chapter 270, Acts, Regular Session ofthe Fortieth Legislature, as amended by the Acts of 1929, First Galled Session ofthe Forty-first Legislature, Chapter 78, and each ‘common carri,rr motor carrier’ operating under certificates ofconvenience a&i necessity issued by the Railroad Commission of Texas, doing business wholly or in part within this State, whether incorporated under the laws of this State, or ofany other State, terri.tory, or foreign country, and every other individual, company, corporation, or association doing business ofthe same character inthis State, in addition to the ad valorem taxes on tangible properties which are or may be imposed upon them respectively, by law, shall pay an annual tax to the State, beginning with the first day of January ofeach year, on their intangible assets and property, and local taxes thereon to the counties inwhich its business is carried on: ~..” Opinion No. O-4441 held that the Legislature intended to include within the terms ofthe statute carriers operating without acertificate in the following paragraph quoted from that opinion:Honorable George H. Sheppard, Page 3 O-6138

“The Legislature must have had some purpose in mind when it enacted the sentence inArticle 7105 that ‘every other individual, company, corporation or association doing business ofthe same character inthis state, inaddition to the ad valorem taxes on tangible properties

.. .shall pay an annual tax to the state
. . , ontheir intangible assets and property, and local taxes thereon to the counties inwhich its business is carried on . . .’ We think that the Legislature clearly meant to include, within the meaning ofthe sentence Justquoted from Article 7105, any individual or concern ‘doing business ofa similar character’ to a ‘motor bus company’ or a ‘motor carrier.’ The fact that the individual or concern has not complied with the laws ofthis state does not weaken the strength of our conclusions. Rather it strengthens it. The Legislature cannot be presumed, in the absence ofcompelling words clearly showing acontrary intention, to have intended an absurd, or unjust or unfair result ofthe application ofthe intangible tax law so as to result in pecuniary advantage or favor to those who willfully or inadvertently disregard the laws ofthis state. 39Tex. Jur., p. 246. We think the statute permits no such interpretation.” Clearly it is not necessary to broaden the construction here placed on the statute in order to include within its terms the truck lines or operators mentioned in paragraph 2ofyour letter.

Thus far we have held that the lines mentioned in your letter are subject to the assessment ofan intangible assets tax. In holding further that the State Tax Board may certify such intangible assessment found on carriers that were engaged inbusiness as acommon carrier on January 1under the circumstances stated inyour letter, we cite the authority ofthe case of Cadena v. State, 185S. W. 367 as quoted in opinion No. O-3546:

“All property owned on the 1st day of January is subject to any tax authorized by law, whether such taxes have been authorized theretofore or may be authorized during the year, and can be levied by the body given the power to levy at any time during the year. Laws naming the time for the levy oftaxes are merely directory, and legal taxes can be levied whenever the necessity arises. Laws authorizing taxes are not retrospective so far as the year inwhich they are authorized is concerned.” See also Masterson v. Hedley, 265 S.W. 406; 61C. J. 564.- .

Honorable George H. Sheppard, Page 4 O-6138

While the words “levy” and “assessment” as used in tax parlance are not exactly synonymous, yet the one includes the other in that the assessment is anecessary part ofthe levy. We think it does not strain the construction to hold that the certification ofthe intangible assessment is also anecessary part ofthe process ofthe levying ofthe tax, and, that in order to carry out the intention ofthe statute, that which is subject to taxation may be assessed and certified within areasonable time after the date mentioned in the statute for such certification when it is found or discovered to have actually been subject to the tax on January 1.

Since we have answered inthe affirmative your prmcipal question, it becomes unnecessary to consider the question which you propounded in the aiternative. Yours very truly, ATTOR_NEY GENERAL OF TEXAS

BY Robert F. Cherry

Assistant. u RFC/JCP

APPROVED OPINION COMMITTEE BYChairman