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..,OFFICE OF THE ATI-ORNEY GENERAL OF TEXAS 

-- AUSTIN 

0-o.MNW 

*-aAv Eonomble George H. Shepperd 

Caaptgwller of Public Aacowite 

AdIn8 Texas 

mar sirr 

of OholJl store 

I operatedby 

This 18 Itn answer to your re 

~ovrpbsr 25, 1941, In whioh you re 

quertlons t 

on the ahaln 

,andwhl&4ls 

eea ae lnoidontao&.red thmugh 

rade-ln arJpliraoer 

ion under Section 5 or the classification und8r Seotlon 5a3 

"Query Three. Suppose it be held thst the ooapany 

stort*sln nuch mm11 towns vould be Uabls for the ohaln 

etore tsrx If they sold any OF 411 of the above type 
tasde-In appllaaoea, oould they legltiorrrtel~ dlrpcre 

of auah trbde-ia appllmeea by merely tmasforrlng 

them to tovna ofnore thans,ooo pepulatianvlwaw the 

cgp~xalaalruadyp.syw$ the ahaLa atore t&x anawh 

"Query Four. Aaatm~ing thbt thla veuld be a 

legltlmate way of dispoalng of euoh Wade-In a plirntea, then would ouch atoroa in tovm of mom &a 

3,000 population whfah l -o a lmb dy p s)-ing tb o h b in 

aton tax under Seotion 58 of Artlelo lllld P.O.) be 

lisble to pay a duplleate tax under Soatlcm 5 by reaaon of ita dlapoaltlon of trade-in owodltles vhluh 

are neither gas or eleotrloal qpllmaoea but 8re appllanoes auoh 08 lae box refrlgoratora, oil, ooal or 

keroaeae bumen? " 

The pertinent part of Artlole 7060 as amended, Act8 1941, 

47th Legialaire, Rowe Bill Ho. 8, Article v, seation 1, read8 b8 

fOllov8 I 

“And protlded rUrth8p thfit utll%tlea p8* bn 

oceupatlon tax und6r thle Aptlele -11 n& hnwfter 

be required to y the lioeime fee impoaed in Artialo 

5a,.House Bill LB0 o.18, Chapter 400, Aota of pclrtyfourth Leglalrture, fop t& privilege of r&l* pa 

and eleotrio appllaneea and rtr for the repriM 

theroof, lntouna of three kJiLu%d (~,Ooo o-;w 

in pcpulatlon aoccrding to the lfktt pnoed L 

cenaua . ’ 

Query One. Aaaumiag that the aton in lerrrted ia a tovn 

Of lea8 than 3*000 population, la oxbmpt fram the ohala Itore tax 

undetr Article 7060, aa amended, and ia eng8gad la the ~elllng or 

metural gas appllmow, aa inai&M,aZ to it8 utility bualnera, end, 

bacepta trade-In appliuraea af~ a part of tha sale Flee of it8 

Zrbtumbl go9 appU.anoea, it la our opinioa tht au ox atoro ia entitled to sell aueh trade-in 6ppl%w#ea vlthmt subfesting Itself 

to the chain store tax, 

The acaeptanae of au& trade-in appl¶maees, lia part pa?- 

sexit of the sale price of the new a llamea, la a part of the 

oonaldsratlm for the sale and ia 03 yba l?ialdent Of th.4 bualmJaa 

of the seller. He la equally euthoriacd to oonvert suah trade-In 
I Bopombble George H. shepphtrd, Page 3 

I epgli43aae into aaah a8 he would b8 to a*11 for aesh in the flnt 

l&aace, so long ead0n.l~ aolmger tho OOCOptUtce cad UlO af 

awh trade-la rppllanoea, la only l.wUlentel to hl8 pr%whry bual- 

-88 of Purnlah~~ nDtvrs2 gas SM selling asturPl g86 appllamer. 

Our guprmm Court haa raid: 

"The same pemm or corpontloa may oerry cn 

several QlffezeRt bu6lnea8e8, and, of wura6, aa? ba 

taxed inrespeat ofe8eh~ but* th48L6gtsl*ture 

has defined md taxed ena bualaear, It la not to k 

raamed that it ham lnteaded to &gala tu the use 

business u&w unother mme, nor la it to be rammed 

that It has intended to tax, aa a dlatinet bualneaa, 

vhloh la a mere lnoldent of imother business that 

vhlchh8a beendeflnedsnd tuedraa whole." Texas 

Co. vs. St@ams, 100 Tex. 620g 103 S. W. 481. 

The faata outllaod In your Inquiry !bdle@te that the 

nller fmgager in the selling of the meraheadl 88 laqulnd ebaut 

aalr inoldeatally end oooariosP1~ for tha purpose of oonvo~tiag 

tt.u ule prloe of bir nevme~&WMlae Late mh. Such eollia(t 

bow Saoidentaltoh.lrmalabu8inoar andhehvfng~lndljpald 

4n oeoupatlon tax for the privilege of eoaduatlng that bumlwea, 

vo are of the oplnloa and hold that ho does not w roeh selling 

of tide-la merehend¶.re aubjeat htiaelt to She &da mtcn tax. 

la n#Qhlag this 801L81?l8iCNL, Ye are Rot Iuwadfu of 

tho deofr;ton la tho c88e of Stendaml 011 co. of mxaa V8. state, 

142 8. W. 519, ln whluh writ of erxor wea refumd, whme2.n the 

aouzt tild thst even though defendant was engaged, prSmarlly, 

in storing, arlliag or distributing petroleum pmduota mad l r- 

*Icing of motor vehialea, in order to oame tithln chs l xemp tlc a 

of Seistloa 5 it mat be sngag la wmh bualaeaa. 

That cese, hovevec, pnamta a t fact altuatlon 

from the matter here under dlaoua~ioa. Then, the seller was 

qagpd la oae type of bualneaa obviously vlthln the o.mmptlonl 

It was e&so engaged in another and entirely different bus&moss 

aot vlthln the exmptlon. Here ow mller la engaged in tbo 

business of aelliag sppllaacea urd pets obvlosaly wItMa the 

oxemptlon provided Ln Article 7060. Ia mak hla 

"x, 

rralee he 

rametlmea takes trade-la m6rcheadlae not with the exemptloa. 

He hea the privilege of selling, for vhleh privilege he ha paid. 
It filloVa thet he hre the prlvllege to collect the eel* prlee - 

$0 map the benefits OS hle aarlee. In order to do 80 he muat 

oa?ert his trade-in merchandise into o&ah. He cl&a only do that 

w eolliag those trade-ina. He debits in such merahandlae &y 

gg m incldent to hle bualness. Ye thiak such sales me authirlaed~ 

I@vlw thus Baswered four first queatlon, it heoomer 

unmmrreary to enswer pur ather queatlonr. 

Yours very txulr