Hon. Geo. H. Sheppard 

Comptroller of Public 

accounts 

State of Texas 

Austin, Texas 

Dear Sir: 

Opinion No. o-230~A 

Re: Reconsideration of opinion No. 

O-2304. An individual who owns tank 

cars in which he transports his own 

gasoline and who does not lease, 

rent or charge mileage for said cars 

is not required to make the reports 

or pay the occupation tax under Art. 

7062. 

This is in answer- to your request for a reconsideration by us of our opinion No. O-2304 concerning the payment of 

the occupation tax by private owners of tank cars who receive 

mileage payments from railroads for the use of such cars0 

Me have carefully studied your request for a reeonsideration of our opinion No. O-2304 in the light of the authorities quoted by you in your said request. 

Article 7062 of the Revised Civil Statutes of Texas 

reads as follows: 

“Lath individual, company, corporation or association, residing without this State, or incorporated under 

the laws of any other state or territory, or nation, and 

owning stock cars, refrigerator and fruit cars of any 

kind, t,ank cars of anv kind coal cars of any kind, furniture cars or common box car: and flat cars, and leasin=, 

renting or charm mileape for the use of such cars within 

the State of Texag, shall make quarterly, on the first days 

of January, April, July and October of each year, and report to the Comptroller under oath of the individual or of 

the president, treasurer or superintendent of such company, 

corporation or association, showing the amount of gross 

receipts from such rentals, or mileage, or from such other 

sources of revenue received from,business done within this 

State, during the quarter next preceding. Said individuals, 

companies and corporations, and associations, at the time 

of making said report, shall pay to the Treasurer of this 

State an occupation tax for the quarter beginning on said 

date equal to three per cent of said gross receipts as shown 

by said report.” (Underscoring ours) 
Hon. Georgei'H&She.&&d, page 2 

It is our opinion that private owners of tank cars 

who ship their own commodities in said tank cars and receive 

mileage payments from railroads for the use of the cars are 

not "charging mileage" and therefore are not subdect to~the 

tax described under Article 7062. 

In discussing this article of our law in our opinion 

No. O-2304, we stated as follows: 

"In a second letter on this question you gave us 

additional facts as followst 

"'The owner of a tank car loads said car at 

Sweetwater, Texas, with gasoline and makes out a bill 

of lading on same for delivery to himself at Fort 

Worth, Texas, the Texas and Pacific Railway Company 

moving said car as per bill of lading. The Texas and 

Pacific Railway Company then presents freight bill at 

the destination under the rates and terms of regularly 

published tariffs of the Interstate Commerce Commission. 

"'lit regular intervals, the Texas and Pacific Railway Company, under regularly published tariffs of the 

Interstate Commerce Commission, pays to the owner of 

said tank car the equivalent of l&? a mile for each mile 

which said car traveled loaded on lines of said railway.' 

"As we interpret the facts, these tank cars are 

used to transport only the owner's property. The owner 

loads the car at Sweetwater and the railroad company 

moves the loaded car to Fort Worth, where the owner pays 

the freight on the load at the same rate as if the property had been transported in the railway company's own 

car. At regular intervals the railway company pays the 

owner of these cars l&? a mile for each mile it was used, 

that is, traveled, while loaded. 

II . . . 

"It will be noticed that the part of the statute 

with which we are concerned says that 'each individual 

. . + owning . . . tank cars of any kind . . . and leasing, renting or charging mileage for the use of such 

cars within the State of Texas' shall make the required 

reports and pay the prescribed occupation tax. Under the 

facts that you have given us the individual owns tank 

cars. But, is he engaged in 'leasing, renting or charging mileage for the use of such cars'? We think the answer is 'No'. 
Hon. Geo. H. Sheppard, page 3 

"It is true that the owner of the cars is paid a 

sum of money by the railway company that transports the 

cars at a rate of so much per mile while loaded; but, 

we do not believe this is an arrangement by which it can 

be considered that the owner is leasing or renting the 

cars to the railway company. Nor do we consider that 

the owner is charging mileage for the use of the cars. 

What it amounts to is this: The individual in question 

furnishes his own cars to haul his own property, and of 

course he is entitled to pay a less transportation charge 

to the railway than he would be if the railway furnished 

the cars; and instead of paying a smaller freight rate, 

the individual in this case pays the same rate that he 

would pay if the railway furnished the cars and the railway in turn hands him back l&z+ per mile. 

"If the railway was allowed to haul other people's 

merchandise in this car-owner's cars, and said car-owner 

was paid l&? per mile by the railway for so using the cars 

that would constitute 'leasing, renting or charging mileage 

for the use of such cars'; but, we understand that these 

cars are used only to haul the car-owner's property. 

"This statute was apparently intended to apply to car 

owners who leased and rented their cars to others or turned 

their cars over to other persons and charged mileage therefor! for such other persons to haul their (said other person s) merchandise or haul merchandise for hire as a common 

carrier. We do not believe it was intended by the legislature that this statute apply to cars used exclusively for 

hauling the car owner's own property." 

It is our judgment that our opinion No. O-2304 correctly 

stated the law applicable to the fact situation stated by you, 

and we therefore readopt and affirm said opinion. 

~APPROVED JUN 3, 1943 

/s/ Grover Sellers 

FIRST ASSISTANT ATTORNEY GENERAL 

GPB:HMMzwb 

Yours very truly 

ATTORNEY GENERAL OF TEXAS 

By /s/ Geo. Pi Blackburn 

Geo. P. Blackburn, 

,Kssistant