December 28, 1962 

Honorable Robert S. Calvert Opinion No. WW-1517 

Comptroller of Public Accounts 

Austin, Texas Re: Whether under the facts 

submitted, a corporation chartered by an 

association of teachers 

should pay the franchise 

tax required by Chapter 

12, Title 122A, TaxationDear Mr. Calvert: General, V.C.S. 

You have requested the opinion of this office concerning the liability for payment of franchise tax of a corporation chartered by an association of teachers, Your request 

included the purpose clause of this corporation, which is as 

follows: 

"Section 1. To cooperate with the Texas 

State Teachers Association and the National 

Education Association in the promotion within 

the teaching group of the highest type of professional practices; to encourage active participation of all teachers in the solution of school 

problems; to encourage every member to be a progressive student of education; and to arouse 

allegiance to a genuine code of professional 

ethics. 

"Section 2. To encourage higher qualifications for entrance into the teaching~profession; 

to guide well endowed young people to select 

teaching as a life,work; to improve the~social 

and economic,status of teachers; and to form a 

representative body able to speak with,authority 

for them. 

"Section 3. To promote, encourage and 

assist other local teacher organizations and to 

promote cooperation among such organizations and 

their members. 
Honorable Robert S. Calvert, Page 2 (WW-1517) 

"Section 4. To cooperate with parentteacher associations and other civic bodies 

having educational objectives and to aid in 

interpreting to the public the problems, the 

functions, and the steady progress of the 

public schools. 

"Section 5. To encourage teachers to 

exercise their rights and privileges as citizens 

and to accept willingly leadership in civic 

affairs." 

We understand from your request that this corporation 

was organized under the Texas Non-Profit Corporation Act, 

Chapter 9, Title 32, Vernon's Civil Statutes. There is no 

provision exempting all such corporations from payment of 

franchise tax. 

Article 12.01, Taxation-General V.C.S., as amended 

Acts 1961, 57th Leg., p. 182, ch. 97, 81, provides that: 

"(1) Except as herein provided, every 

domestic and foreign cornoration heretofzor 

hereafter chartered or authorized to 

in Texas or doing business in Texas, 

or before May 1st of each year, file 

as are required by Article 12.08 and 

in advance to the Secretary of State 

tax for the year following. o ." 

do business 

shall, on 

such reports 

12.19 and pay 

a franchise 

Article 12.03, Taxation-General, V.C.S., lists a number 

of exemptions from the franchise tax. Of the categories of 

corporations qualifying for exemption, the closest to the 

corporation in question are corporations organized for 

"F-G= 

educational.purposes, or for purely public charity," 

( mp asis added.) 

Two fundamental principles,should be noted here. As 

pointed out in Attorney General's Opinion No. O-4137, wherein 

a question similar to the present one was discussed, "It is 

too fundamental to require the citation of authorities that 

one~claiming an exemptions from the payment of taxes must 

clearly come within the exemptions.therefrom provided by the 

law." The rule that in determining the~effect of a statute, 

every word is presumed,to have a purpose and each word should 

be given effect, was clearly stated in Eddins-Walcher Butane 

co. V. Calvert, 156 Tex. 587, 298 S.W.2d 93 (1957). 
Honorable Robert S. Calvert, Page 3 (ww-1517) 

Giving effect to the words "strictly" and "purely" as 

used in Article 12.03, it is apparent from the above purpose 

clause that the corporation in question will not come within 

the exemptions set out in that Article. 

Section 1 of the purpose clause is clearly a professional 

purpose, designed to improve the quality of the teaching profession. Section 2 is much the same, but provides for improving the "social and economic status of teachers" and for forming "a representative body able to speak with authority for 

them." These sections, together with Section 3, indicate a 

purpose and function of the corporation not significantly 

different from those of other professional and trade associations, i.e., to better the social and economic conditions of 

their members. 

Section 4 is, by itself, more nearly an educational 

purpose, and Section 5 suggests the encouragement of general 

civil responsibility among teachers. 

While teachers are educators and are employed primarily 

to educate, the purpose clause of the corporation considered 

here reveals that the corporation itself was not organized for 

%;~;C;;, educational purposes, or for 

e corporation does not qualify 

franchise tax. 

SUMMARY 

Under the submitted facts, a corporation organized 

by an association of teachers, the purpose of which 

is neither strictly educational nor purely public 

charity, is not exempt from payment of the corporation franchise tax. 

Yours very truly, 

WILL WILSON 

Attorney General of Texas 

w-s 

Assistant Attorniy &&era1 

JAP:ca 
Honorable Robert S. Calvert, Page I, ww-1517) 

APPROVED: 

OPINION COMMITTEE 

W. V. Geppert, Chairman 

Norman Suarez 

W. 0. Shultz 

Cecil Rostch 

REVIEWED FOR THE'ATTORNEY GENERAL 

BY Leonard Passmore