Hon. Franklin Perry, Chairman Committee onConstitutional Amendments House ofRepresentatives 52nd Legislature Austin, Texas Opinion,No. V-1155. .:,
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Re: ,Effect of the proposed conatitutional prohibition against - levying a general sales tax upon existing sales taxes and Dear Mr. Perr.y: future specific sales taxes.

You have requested our opinionon that por~tion:of’-Committee Amendment No. 1to Rouse Joint Resolution No. 1, Acts 52nd Leg.,, R.S. 1951, proposing 

### an amendment to Section 1ofArticle,VIII of the Constitution of Texas, reading as follows: :

1.

.~.. the Legislature shall never levy d’geksral sales tax upon the,people ofthis State;

. . . ”

Your request presents two questions.: first, the effect of the,proposed constitutional amendment upon the validity of the existing “sales taxes” of~this State; and s,econd, its effect ,uponany

“sales taxes “~

that may be enacted inthe future..

A review of “sales tax”

. legislation in the different States during recent-years re’flects a great variation in the types of sales taxes which have been ‘imposed. The decisions as to the exact nature of the taxes which have been ter,med “sales taxes” are not in harmony. Such taxes have been &scribed by the.**cpurts.,as** ,occupation taxe,s, privilege taxes, income ‘taxes,~excise taxes, and, in rare instances, as property taxes.. Ithas.been said that “the difficulties in attempting to reduce the term ‘sales tax,:’toa.ny,single all-inclusive formula appear to be insurmountable.” 47 Am. Jur. 194, Sales Tax, Sec. 1.Thus, itkapparent that the difficulty inanswering your first question lies ina determinqtioqof what,existing taxes ,inthis State are in fact “sales taxes.” Certainly the motor fuel taxes 1and

1In State v. City ofEl Paso, 135 Tex. 359, 143 S.W.Zd 366 (1940), itwas held that the motor fuel tax levied by Article 7065a-2, V.C.S., (repealed in 1941 but similar to that now levied under Article 7065b2) was a “use” tax and not an occupation tax.

# 259 Hon. Franklin Perry, Page 2 (V-l 155)

many of the occupation taxes, such as the gross production taxes levied on the occupations of producing gas, oil, or sulphur, (Arts. 7047b, 7057a, and 7047b(40b), V.C.S.) would not be considered as being within the prohibition of the proposed amzndment, even though such taxes may be pass don to the consumer. The Le islature has imposed use taxes; 5 stamp taxes;4 and license fees under the ! police power of the State for regulatory purposes. In our opinion taxes ofthis **nature** would not be repugnant toa constitutional prohibition against a general sales tax.

2Itwas held inAtt’y Gen. Op. V-1027 (1950) that the taxes levied byH;B.‘3, Acts 51st Leg.; 1st C.S. 1950, ch. 2, p. 10, on oil production, gas production, sulphur production, telephone gross receipts, gas, electric, and water company gross receipts, carbon black production, cement distributors, motor carrier gross receipts, oil well servicing, insurances gross receipts, and chain stores are occupation taxes within the meaning of Sec. 3, Art. VII of the Constitution ofTexas. This’ opinion was based on theauthority of Producers’ Oil Co. v. Stephens, 99 S.W. 157 (Tex. Civ. App. 1906)~; State v. Humphrey, 159 S.W.2d 162 (Tex. Civ. App. 1941); W. R. Davis, Inc. v. State, 142 Tex. 637, 180 S.W.Zd 429 (1944); Oliver Iron Mining Co. v. Lord, 262 U.S. 172, 43 S.Ct. 526 (1922); Dallas Gas Co. v. State, 261 S.W. 1063 (1924); State Tax Commission v. Hughes Drug Co., 293 S.W. 944 (KY. Civ. App. 1927); United North &South Dev. Co. v. Heath, 78 S.W.2d 650 (Tex. Civ. App. 1934); Gaar, Scott &Co. TV.Shannon, 115 S.W. 361 (Tex. Civ. App. 1909); Philtex Chemical Co. v. Sheppard, 219 S.W.2d 1010 (Tex. Civ. App. 1949); Trinity Portland Cement Co. v. State, 144 SW.2d 329 (Tex. Civ. App. 1940); Texas Consolidated Transp. Co,. v.:State, 210 S.W. 2d 891 (Tex. Civ. App. 1948); Cobb v. Harrington, 144 Tex. 360, 190 S.W.Zd 790 (1945); Southern Realty Corp. v. McCallum, 65 F.2d 934 (1933); Western Co. v. Sheppard, 181 S.W.2d 850 (Tex. Civ. App. 1944); Sheppard v. Rotary Engineering Co., 208 S.W.2d 656 (Tex. Civ. App. 1948); Kansas City Life Ins. Co. v. Love, 101 Tex. 531, 109 SW. 863 (.1908); Hurt v. Cooper, 113 S.W.2d 929 (Tex. Civ. App. 1938); Hurt v. Cooper, 130 Tex. 433, 110 SW.2d 896 (1937); Sec. 30-002, C.C.H.; Attorney General’s Opinions O-4731 and O-4847; Edward Brown h Sons v. McColgan, 128 P.2d 1,86, 53 Cal. App.2d. 504.

3Article 7065b-2, V.C.S., is an example.
4,Article 7047c-l,,V.C.S., is an example.

5Article 7047d, V.C.S.. is an example,,’

Hon. Franklin Perry, Page 3 (V-1155) ~,: ;/ ;

The most familiar and~~generally

### recognized retail sales taxes inTexas are the “luxury excise? taxes le&ed.by Article 70475 V.C.S., on the sale ofnew cosmetics, radios, television sets, and playing cards, and the “motor vehicle retail sales” tax levied by Article 7047k, V.C.S. Itwas held inAtt’y Gen. Op. 0-4403-A (1942) on the authority of Lash’s Products Company v. United States, 278 U.S. i75 (1928) that the tax imposed byArticle m471 was a “gross receipts” tax and not a sales tax. The motor vehicle sales **tax** levied by Article 7047k combines the features of both a retail sales tax and a use tax. As has been previously pointed **out,** there. is doubt as to the exact classificatiorrof these and similar taxes, ,but it is clear that such taxes are at the most

“selective ~sale taxes” and not u eneral ”and would not.fall within 7m---! the proposed constitutional proh tonagainst a general sales tax.

The proposed amendment would be adopted. in contern* ’ elation ofexisting tax **statutes** and such statutes therefore would not be held invalid unless clearly inconsistent with the provisions of the proposed amendment. 11Am. Jur. 642, Constitutional Law., Sec. 36; 9Tex. **Jur.** 420, Constitutional Law, Sec. 9. Great weight is attached to the opinion of the Legislature as to its own powers and as to the legislative interpretation ofa constitutional provision. 11Am. **Jur.** 699, 790, Constitutional Law, Sets. 79, 129; 9 Tex. Jur. 439, 480, 482, Constitutional Law, Sets. 27, 61, 62. It is to be assumed that the Legislature inadopting H.J.R. No. 1, as amended, would not expect itto result in the repeal ofany present tax statute.
It is, therefore, our opinion that the passage by the Legislature and adoption by the people ofH.J.R. No. 1, as amended, would not affect the validity of the existing tax statutes above referred to.
With regard toyonr second question, we must advise that we are unable to answer it categorically. Itwould be speculation on **our** part toattempt toanticipate the types of taxes that may be imposed by future Texas Legislatures. Itis not unreasonable to observe that the **courts** of this State may find, after a period of years, that numerous so-called “selective **taxes ”**  **would** have the cumulative effect ofa general sales tax and thus hold that some or all of such **taxes** are invalid under the proposed constitutional amendment. This is a matter, however, upon which we do not pass at the present time for the reasons herein stated.

SUMMARY f The adoption ofthe proposed amendment to Section, 1ofArticle VIII ofthe Constitution ofTexas pro-Hon. Franklin Perry, Page 4 (V-1155)- /

hibiting the levy ofa general sales, tax would not affect thevaliditvof the existing tax statutes in this State.

APPROVED:

W. V. Geppert ,.. Assistant Taxa,tion Division .’

.Charles D. Mathews First,Assistant

Price Daniel Attorney General
FL:b:mwb Yours very truly,

PRICE DANIEL