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.

‘. OF TEXAS

AUSTIN PI.Texan
September 21, 1959

S. Calvert OpinionNo. ~-706 HonorableRobert Comptrollerof Public Accounts Capitol Station Re: Applicabilityof H.B. Austin 11, Texas 11, Chapter 23, 3rd Special Session, 56th Dear Mr. Calvert: Leg., to hotels.

By letter dated August 28, 1959, you have requested an opinion on certainquestions dealing with the new hotel occupancy tax. Since your questions are numerous, each wlll~be stated and answered individually.

QuestionNo. 1: Is the characterof accommodations taxed by the new act limited to sleepingrooms?

Answer: Article 23.02(a) of House Bill 11 provides: "There IS hereby levied a tax upon the cost of occupancy-ofany EQpm or w furnishedby any hotel where such cost the rate of Two Dollars such tax to be equal to paid by the occupant.
. .' Occupant is defined In the Act as: I,

. . .anyone,who, for a consideration, uses, possesses, or has the right to use or possess any room or rooms In an under any a, concession, of access, license, perm+,hZiit

contract or agreemen .' - It Is apparent that the.HotelOccupancy Tax is not limited to sleepingrooms, but is collectibleon the price charged for any lease, concession,right of access, license, contract,or agreement for any room or space in a hotel.

Question No. 2: .If the tax Is collectibleupon other than sleeping rooms, is it collectible is situationswhere a hotel owns or has control of a building or space located separateand apart from the hotel Itself,but which on occasion may be used for certain functionsby people, includingguests of the hotel?HonorableRobert S. Calvert, Page 2 (OpinionNo. ~~-706)

Answer: The term "hotel"means any buildin or buildings in which the public may, for a consdn:obtain sleeping accommodations. Art. 23.01(a),H.B. 11. Such tax is to be levied upon the cost of occu ant as defined above. ---4+&p~~c;jtym~~~~m"~ Art. 23.02, H.B. ii. the use or possession,or the right to the use or possession, of any room or rooms & a hotel. Art. 23.01(c), ~3. il. It Is clear that the tax Is not collectibleon rentals or char.ges

imposed on buildings owned by a hotel, which are se arate from the hotel and which are not used !?kFegr* letting sleepingaccommodations.

QuestionNo. 3: In Instanceswhere a hotel extends credit to a guest, is the tax due when occupancy occurs, or when the account Is actually paid?

Question No. 3A: Is the tax due In cases where guests leave w~lthout paying their bill, therebybecoming what is known In:

the trade as "skippers"?
Answer: The tax,18 levied upon the consideration paid by the occupant. Art. 23.02, H.B. 11. The tax Is to be collectedby the hotel. Art. 23.03, H.B. 11. Article 23.04 provides:

"On the last day of the month following each quarterly period, every person required In Article 23.03 hereof to collect the tax imposed herein shall file a report with the Comptroller showing considerationpaid for all room occuuancles In the Drecedinn quarter, the amount of tax collectedon such -. and any other Informationas the may reasonablyrequire. Such person shall pay the tax duo on such oczupanclesat the time of filing such report. (Enphasls added;) The foregoing language clearly indicates that the tax Is due from the hotel only In cases where the consideration has been collected from the occupant. Consequentlywhere a person la given a complimentaryroom or "skips"with?& paying, no tax Is due, since no considerationhas been paid. For the same reason the hotel need~not remit taxes~dueon accounts ~wherecredit has been extended until the cost of ocoupancy has actually been paid by the occupant.

1It should be noted that anytime a "skipper" Is brought to heel and made to pay, the tax is due from the hotel.. . ‘.

HonorableRobert S. Calvert, Page 3 (OpinionNo. ~~-706)

QuestionNo. 4: How Is the tax collectible upon the "AmericanPlan," I.e., the systemunder which a guest pays lump-sum for meals and lodging?

Answer: The tax Is upon the cost of occupancy and not upon the cost of meals. Art. 23.01(b),H.B. 11. Consequently,such costmust be segregatedln20rder to calculate the tax upon the cost of occupancy.

QuestionNo. 5: .Is the tax to be paid upon the rentals of equipment such as televisionsets and radio sets that are not an Integralpart of the furnishingsof the room? Is It levied In situationswhere air conditionersare rented wholly separate and apart from the room rental?

Answer: Again, the tax is upon the cost of occupancy. Where radios, TV sets or air conditionersare rented separate and apart from the room, and a separate chargemade therefor, the tax does not apply. However, in situationswhere no separate charge Is made.and the air conditioner, radio or TV set Is furnishedwith the room, the tax Is levied on the total cost of occupancy.

QuestionNo. 6: In situationswhere a lessee occupies a spaceunder conditionsthat the term of his occupancy Is not known at the time he takes possession, is the tax applicable for the first 30 days of occupancyeven though the lessee remains in possession for more than 30 days?

Answere: The hotel occupancytax 1s not imposed upon a "permanentresident." The term "permanentresident" Is definedby the act asz

.any occupantwho has or shall have '1. the ri ht to occupancyof any room or rooms In t e otel for at least 30 consecutivedays > durlns the current calendaryear or preceding year.

2 -In this conneatlonwe note that the Department of Revenue of the state of Pennsylvaniahas adopted a regulationwhereby a certainpercentage of the total cost Is allocated to meals. This is a procedure your departmentmay deem expedient In administeringthis particularaspect of the Act.HonorableRobert S. Calvert, Page 4 (OpinionNo. ~~-706)

A peraon Is a permanentresident If he enters possessionunder a lease having a term of at least 30 or more consecutivedays, since he has the right to occupancy for such term. However, In Instanceswhere the original lease term~or commitment Is less than 30 days, the occupantdoes not achieve the status of a permanentresident until he has actuallyoccupied the premises for 30 consecutivedays. Therefore, in such situations, the person would owe the tax for the first 30 days; thereafter, he would be relieved of the tax because of his status as a permanentresident.

Your last question Is directed to whether or not the tax applies to rooms rented from hotels by the Federal Government when moving draftees to reception centers.

It is well settled that In the absenceof express federalpermissionthe State cannotlevy an excise or use tax upon an Instrumentality of the Federal Government. Attorney General's OpinionsNo. W-598 and h'W-582. Therefore,under the facts stated,you are advised that the tax Is not applicable.3

The characterof accommodationstaxed under the new hotel occupancy tax Is not limited to sleepingrooms, but Is not collectibleon buildingsphysically separatedfrom the hotel not used for letting sleepingaccommodations. The tax is due upon the consideration actuallypaid for occupancyand at the time of payment thereof. The tax is not due upon food servedpursuant to the "AmericanPlan," nor is It due upon radios, televlslcnsets or air conditioners rented separateand apart from a room and for which a separate charge Is made.
A person is a "permanentresident" ff he enters occupancyunder a leasg the duration of which is at least 30 consecutivedays, or if he has actually occupied a room or space for at least 30 consecutivedays.


### 3 This opinion is limited to instanceswhere rooms are actually rented and used by or on behalf of a Federal instrumentality in the course of Its official functions.HonorableRobert S. Calvert, Page 5 (OpinionNo. ~~-706)

The tax does not apply to rooms rented to the Federal Government In the course of moving draftees'

to reception centers.
Yours very truly,
WILL WILSON AttorneyGeneral of Texas 

# By%&

Assistant
JNP:cm APPROVED: OPINION CC+MITTEE: Geo. P. Blackburn, Chairman John C. Steinberger Robert T..Lewis Ernest John Flowers Milton J. Richardson
REVIEWED FOR THE ATTORNEY GENERAL By: ‘ W. il. GEPPERT