THEA~ORNEY GENERAL 

OFTEXAS 

Honorable George H. Sheppard 

Comptroller of Public Accounts 

Austin, Texas 

Dear Sir: Opinion No. O-2776 

Re: Are nurseries which maintain places of business 

for the sale of trees, 

plants, etc. from which 

places of business such 

commodities are sold subject to the payment of the 

Texas chain store tax? 

We are in receipt of your letter of October 21, 1940, 

In which you request the opinion of this department as to whethe or not a nursery which maintains a place of business for 

the sale of trees , plants, etc. and from which place of busIness such commodities are in fact sold is subject to the chain 

store tax. As we understand the facts submitted, the establishment in question is a building in which a numberof trees, 

plants and shrubs, etc. are kept and exhibited for sale to the 

public although some of such commodities are also sold from the 

fields where raised. The Legislature of Texas has defined the 

term "store" in the Texas Store Tax Act (Act, lllld of Vernon's 

Annotated Penal Code) as follows: 

'Sec. 7. The term 'store' as used In this 

Act shall be construed to mean and Include any 

store or stores or any mercantile establishment 

or establishments not specifically exempted wlthin this Act which are owned, operated, maintained, 

or controlled by the same person, agent, receiver, 

trustee, firm, corporation, copartnership or association, either domestic or foreign, In which 

goods, wares or merchandise of any kind are sold, 

at retail or wholesale," 

In commenting on said definltion of the term "store" 

the Commission of Appeals of Texas in the case of Hurt v. Cooper, 

110 S.W. (2) 896, stated as follows: 

" The statute having defined the word, we 

are not concerned with its usual meaning. under 
Hon. George H. Sheppard, page 2 o -2776 

that definition a mercantile establishment at 

which goods, wares, or merchandise of any kKd, 

except those exempted, are soid is a store and 

is taxable as such, ana this even though it ma 

also be a distributing point." (Emphasis ours 7 

We are unable to find any case either In this State 

or in any state in the United States in which the court has 

passed on the question of whether or not a nursery establishment is subject to the payment of a chain store tax as being 

a store or mercantile establishment. However, the Supreme 

Court of Illinois in the case of Swain Nelson and Sons Company 

v, Department of Finance, 6 N.E. (2) 632, in construing the'tax 

of that state levied on the retail sales of tangible personal 

property stated as follows: 

"A portion of appellant's business embraces 

sales of trees and shrubs to customers, with 

delivery either at appellant's premises or at 

such places as may be designated by the purchaser, 

Tax liability on such sales is admitted and Is not 

here involved." 

The Commission of Appeals of Texas in the case of Continental Paper Bag Company v. Bosworth, 276 S.W. 170 stated as 

follows: 

"In American usage, the word 'store,' when 

employed to designate a place of business, is 

a broad one. It signifies not merely a warehouse, storehouse or storeroom, but may include 

in its meaning a business establishment where 

personaltg is kept and sold, and incidentally 

gotten in salable condition." 

The term "mercantile establishment" is defined in 21 

C, J, 904 as follows: 

"A place where the buying and selling of 

articles of merchandise as an employment is 

conducted, 

It IS the opinion of this department that a place of 

business established for the sale of trees, plants, etc. from 

which place of business such commocli.ties are sold Is a "store" 

as that term is defined in the Texas Chain Store Act, supra, 

and such-place of business is subject to the payment of’ the 

chain store tax. 

We call your attention to the fact that the Attorneys 
Hon. George PI, Sheppard, page 3 o-2776 

General of two other states have ruled on this same question 

that you present here. The Attorney General of Indiana in 

an opinion to the state tax commissioner dated December 18, 

1931, ruled as follows: 

"Nurseries: Selling trees, plants and vines.-- 

If such nurseries maintain a place for the sale 

and are engaged in the business of selling trees, 

plants and vines which have been severed from the 

place where grown, it is my opinion that such nurseries come within the definition of a mercantile 

establishment and are engaged in the sale of goods, 

wares and merchandise and are liable for the payment of such license fees." 

The Attorney General of Colorado ruled as follows: 

"Nurseries--Selling trees, plants and vFnes.-- 

If such nurseries maintain a place for the sale 

of and are engaged in the business of selling trees, 

plants and vines, which have been severed from the 

place where grown, it is this department's opinion 

that such nursery could come within the definition 

of a mercantile establishment engaged in the sale of 

goods, wares and merchandise, and therefore liable 

for a store license." 

We believe that the Attorney Generals of Colorado and 

Indiana have correctly construed chain store tax legislation 

similar to our law in applying the same to the type of nursery 

discussed therein, It is our opinion that such a place of business as in the facts submitted is subject to the payment of 

the Texas chain store tax, 

Yours very truly 

ATTORNEY GENERAL OF TEXAS 

By s/Billy Goldberg 

Billy Goldberg 

-Assistant 

BG :rw :wc 

APPROVH) NOV 4, 1940 

s/Gerald C, Mann 

ATTORNEY GENERAL OF TEXAS 

Approved Opinion Committee By s/BWB Chairman