292 

wanlfertly the rtatute 00~14 hsve easily 

been mds rsore a~4alflc in this retyard. E4 aenceive, bmneV4r, that a21 of the contentions here 

mde by appellents, whsther eatuell~ mired in the 

atteok upon tte vmll418p cf tbe ictt or mt, were 

nrcersotily invclved in tbQ @ttIhoka mebe upon it8 

aonrtitutlonality in Burt T. Gaoper, aupre, rhloh 

follourd the declriona in t& Jeo&eon end FiOrgrreld a&ems, rupra, en4 Ugeett Co. vr Lee, 488 

0. 6. 819, 88 8. ct. 681, 97 L lKd. 989, 88 

A. 1. R. 6Wg ia all of *blob eaee8 the vaoli@itp 

tbcreof, notwithetendlng ruoh indefiniteoars in 

the rerpects rtrtod, vu6 auatdaed . . . 5% 

ia ii~~ 0i tb s.wdbw25 60 l p dr io a xg pro - 

vide bar, and by whati tha tax 8e impcsod should 

be paid, should not, in view of t&e 4eolrione upholding the hot l # Valid, be psrtitt84 to d*feat 

it8 pl-OVi$iOn&. . * 

Tbr court did aat Haho to whet extm~t or in *bet proportion 

the taxpspre, to-wit, tha,mtoro operaton, WM l eoh liable, 

It act beini~ nr0semx-y to a00m that qwn6ion. lhwor4r, thn 

oourt oleerly held that the Aot ilr ml14 en4 that fail- of 

tbti f.egi8letW8 to sake thf8 pl'OVi6iciI sore s~eoif'io Will not 

*br grraltted to d@ffmti it* (bhe A86’8) ~rovisioa&" llhlrr 

hol4lag alberlp indiaa8ob ktmt the sour6 bellwed t&fit thr 

Aat rbauld and could be enforaed an hbe baeir thet ell oi 

the stare8 in II 0888 of this kind cdnstitute oae ehaia. If it 

lr valia end is to be l nicrcea, e tar is due on 6 ebein oi airtrsn etorsr (in ths actme you eek &bout) end the operaDorm of 

those storer must pap it. 

51oction B af the AQt piovldes that %eaah epplloatlon 

l hall be l oomptmled by a ifliag fee of fifty (SO) osn68 for 

seoh utore." ?fn thiak that fee rhauld bs p&I by the person 

or oorpomtLan ogsratiatg the 6tcre and 6bsnton 6to ootgorntionr in guertlon should per the f f llng fee pmwrlbed in f3eotion 

8 a8 foll~~e: Gcrporntion A, $1.00 for its two rtorao~ Corporation B, $a.00 tar ltn four ntoreo) en4 Ccrpora6ton C, &.OO 

ior lte tea mtcrtss. 

Bootian 8 of the Aot providee a aaalr of lioenee 

t4rr 48 follart 

*Ths lloenms ieer harrln g~~sorltml eke11 be 

urn folloue: 
Boaomble Oebrge H. she&?prd, page 0 

'1. Upon ona (1) atom the li6ease fee ehall 

be On6 Dollar (81) ; 

"4. Upoa eeoh eddltlonel store in I 

on~a (1) but not to oromd two (a), the 1 f 

cm8 of 

den@, 

US. Upon aeob ad~aItIonal sto r e in l xoeme of 

two (a) but not to exased flte (8) thr liewee 

rw #hall be T%ventpilve Dollar8 ($St!J).; 

"4. npon eaoh adUltIcimd rtoro In 0x00~~ or 

tlve (a) but not to etoeod ten (10) the lioense 

fee ehell be fittr Doll- ($5O)j 

"8. U&n saoh eddltional #tore in l xeesa of 

ten (10) but not I*O~.,+oWd tWelaty (80), the lieenmo iw ahall bo Oh8 Xun4red Arty Y&l&era ($180) 1 

w~eaoh additional ston in l r@wa ot 

but"not to cutore thli'ty-ii,ve ($8) 

the lloenw t4e ehall $0 Two Xuadred Fitly Doll 

l4r6 (ItWO) t 

A9. Vpoa~.awb rddltiawl atom in ww8* 6f 

ttlrty-five (38) bu8 not ta l xooed P:Stj (80) 

the lloenea fie ehall be Inca kIundr@d Dallera 

(96oo)r 

W. Up o n l croh edditlona2 store in l xoem at 

fifty (SO), tha liams* fee shall be Setron Xundrod 

Flfby Dollerr (#WOll . . . * 

The H. I. Bu3ubt Orooery Uwpaay 0010 

robe1 language that t&m* store8 

obein for tax purpoea~~,~ That belag 

how 16uoh ie due under 3eatlon Is for the oporstion of aixtoon 

Btorem. The 8um lr Bl,iiS&OO, anivod sit as tollowrr 
1 stox4 $ 1.00 

1 sOd~tlontl1 etors (In 

8X4886 Of 1) 5.00 

3 o4altional 4tnres (In 

6XOa3d of 2) 715.00 

S aCdft.ional stoma (In 

4X4.865 Of 5) PS0.00 

S aauitional storer, (In 

4x0445 of 10) 

Tbrrtorem 

ThI8 atm ef &e3&GG I8 the aus owoa for the opraElan of thfe ohala. As utatad in the forepert of thlr OpInloll, the p,erscnr Or ccrporotioaa who al.0 nqulmd to pay ar4 

those who vqerate, mlntoln, o en or erwablIshw them l to x w. 

There ers aixtnen utoroa, that s a, unit*, In the ehaln. Corporation A opwtitsa two of the aixtaen, Gargoxation B opentm 

four of the aixtaan, an4 COrpOratI~ G 0per8te8 10 0i the *lxteen. In cth4r wards, Cnrporatlon A OpOl%It8~ l/&h or *ha 

ahaln, Corporation 0 aparater l/&h ct the diniD, and Oorpontion G operatea S/i?thr af the ohaln; on4 aooordIW, G-orgoratlan A Iu liable tcr l/stb of the tare6 duo under W6tion S, 

to-it, lJ8th of $1,immo, pna Garpcwetlon D is Ilob fox 

l/&h of asid tllX88, to-wit, l/&h of #l,SSSLOG; 

tic&n G i5 litable inr 5/8tha ai Sal4 taxes,tO-Wit, 

a 

$l,ti3fk.O0. Therefore, said outW4Iary oorporstlonr era liable 

under Section 5 aa followst CarporatIon A, #lst.GG far Ita 

twe atcns$ 

Corporation C, 

orcrtion B, $3C&OO for Itr tour atone; and 

770.00 tar lta ten 8toras. 

54Paotii.m 7 af the @O#$ ffr$ini0 Chain St0x.a T&ix A00 

is i(hntloa1 with &ofIon 6 of 8ha T4x4rr Act. R3so 3eotIoa 5 

Of eaoh or tb:a sata 61888448 the tax Ill daOSt idOUt:Otrlly 

t!a mm4 longuhgs. The Enita4 Gtetss mistrIct GourC of 

ths Fauthm Mstriot of %'8Ut vir&ia aOlldWu44 %eotion 7 

Of the ITant ViZ@nia k4t in eh8 Oat8 O? &iii ReflnIn$ CO. V. 

lbcr, 11 Pe4. SUQQ. UiS, and atate a6 folMws~ 

*Rafmame fm aim a 

Of the f4d8Td 4Ourbm in 

vialo~a ol asctions &?4O(b 

lQL% (40 ,Btat. 1081 108&l 

the R4VMUO AOt Of i%il ( 

it was 4naOt8u tbet two 0 

tlona ahall bs a4en4a sir 

on4 corporation owu9 aha 

tially all of the atoak a 

id8 to tha 4solaIoaa 

.ntsrpnting tlr4 pro1 Of the hV9nW it& Of 

I, 8na asotlcm 2HO(o) of 

I Hat. 860) aGereby 

’ IQW8 at%C8et I 0 %OrpOra- 

.im8a, lnt*r alla, ii 

it1.y or oontmls sub8tan- 

' tb4 Others. 
.-,. 

295 

%s@tion 7 b4ma 1?1m4 enslogy to the &Tcvi4lona Of V.4 Tievanue aotr. r8Rmaing thr effllletion of onrporation4 tla lkfS4ctin& thclt(Px on corDOTbt4 ~IlOOS?2IT; . .. " 

!I%4 Gulf artlnlng C~.~.preay 0084, aupr4, we8 r4iem4 

84 with epgroval by the court In the R. X. Butt Urooory Co&- 

pany aa44r 

It la of lntcrast to note the mumor of proportionate 4lstrlbutIcn of thota'~ CiS8cl444a In tba Bederr R*vanu* 

Act8 rsferrsd to which BOtn wara wuparea to the control pr0- 

+:sion of the Kaat Virginia Chain Store %zAot. 

tjeatlon J%o Of th8 Fsderel ltevenua Aot af 1918 

provfder In part 4a fallowat 

*(b) For the purpom of th?a moatian two or 

more ilorjestlo oorpo~t1o.m ehull ba dasgod to be 

arfiliated (11 ir one oorpor4tIon maa aimtlf or 

oontrola t:rau&h olooely 8frtiiatea Int8r8ata or 

by a anarlnoe or naprim sub4tantIcl~y all thti 

atook of th4 &her or othera, or (l?)~ If aubatantislly all tha otoak of two or aor oorporrtlonr 

I8 CWn8u or oontroll4a by th4 aamm intarssta.* 

said k4t fppth4r p0viae4, a: to th8 pa)r?.ent 0r tb4 tuxL, aa 

r0ii0w4 I 

*In any ant.0 In wbiah a tux 14 w4n44a upon 

the beair Of 4 OO!NOlidutbd T8tUA, th4 tot31 t&X 

ahell ba ooqsited in the firat Ineatcrncs ~8 u ,Wit 

an4 &ball then be 8S49444a upon the re$psotiVe af* 

riiiat4a corpor4tlone Lz au& proportiona a4 my 

b8 agreed upon #non& thyn, or, in the abaeme of 

SAJ' auah 4$t48E4ctI th84 On Sha ;$44ia oi t:.4 n4t 

Incom properly 44el&mbl4 to 4&ch. . ,@' 

0~ oonoluolon in tkls opinion au to tks fnennar of asesemsent 

Of th4 %0X ItW@ b?! tOSQW8d tQ the IURn’(le~ 0f &B64%48#83s pFOlid8e 

for In the Revanue Aot, auprc, just 48 the imt4a fitataa Dletriot Court ot W44t Vl~trginla oompared ths West Virginia Chain 

&or4 mt to suoh R*tenua Act. 

Aa you ocly Inquire about tin4 llabilltp of the sub-’ 

siaiatp 0ap0mi0na, A:, n 3na c, In the raot altu4htiQn you 

prsuant, thie opinion 14 ccnfined to the qU84tlQn yQu esk, end 
i ii. 296 

& are not paming upon the extent of liability, if any, 

i of holdlra ooqany X. Our oona~usion end opinion on the 

qusetion YOU e8k my be auxmfirlzed an follows: The Texas 

Ohafn Tax 18 4rs4ss4d agelnet lnUlrlQualr, aorporatlonr, 

et4., rho 0p4n, emtabllsh, optwets and n:ainteln stores. 

&oh a pewon, aorporatlon, eto., 0~40 the tax on the stor4s 

he or it 80 operate4 slnd aaaintalns. TRe three subeidlary 

sorporationo here are liable for the taz as one oheln under 

Beation 6 of the Texas Aot. 

it8 stores. 

Eaoh oorporation muat pay on 

The tax Is one whlah la based on the nuaber of 

rtorrr, and, therefore, eaoh corporation paya an wount 

proportionate to the number of atom8 in the one single 

ohain that woh oorporatloa operates. 

Yours wry tru3y _ 

AWROVEDm 27, 1940 

COMMIITEC