SenatorA. M. Aiken, Jr. Opinion No. c-56

Chairman, Committeeon State Affairs The Senate of The State of Texas Re: Austin, Texas Constitutionality of Senate Bill No. 258 Dear SenatorAlken:

This acknowledgesyour request for an the validity of Senate' Bill 258, Fifty-Eighth copy of which is attached to your request. opinion as to Legislature,a

This bill, If enacted,would amend the present statutes of Texas by exempting from the sales tax levied by Chapter 6, Title 122A, Taxation-General,Vernon's Civil Statutes, the sale of any motor vehicle to be used by a church solely In the operation of a school for the education of children or for the transportation of said children to and from or in connection with said school or Its activities. Itwould exempt motor vehicles, trailers and semitrailers which :re the property of and used exclusively ln'the service of

. . .a church when used exclusively in connectionwith the operation of a school operated by said church or in the transportation of children to and from said school or in connectionwith said school activities thereof,

. . .' from registration fees required by the motor vehicle registration lawsprovided in Articles 6675a-1 through 6675a-17, V.C.S., 1925. This bill also makes provisions for the refunding of the motor fuel tax, levied by Chapter g,,of Title 122A, Taxation-Qeneral,V.C.S., on motor fuel used

. . . for the purpose of operating or propelling any
. . . motor vehicle to be used by a church solely in the operation of a school for the education of children or for the transportation of said children to and from or in connection with said schoolactivities,

. . .'.

Although this bill proposes to amend three different tax statutes, the amendments are all germane to the one subject of taxation; therefore, it is not invalidbecause of more than one subject-matter (Missouri-Kansas-TexasR. Co. of Texas v. Rockwall County Levee ImprovementDlst. No. 3, 117 Tex. 34, 297 S.W. 206 (1927)).

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SenatorA. M. Aiken, Jr., Page 2 (No. C-56)

ArticleVIII, Section 1 of the Texas Constitutionprovides in part as foll,ows:

"Section 1. Taxation shallbe equal and uniform. All property in this State, whether owned by naturalpersona or corporations, other than municipal, shallbe taxed In proportion to its value, which shallbe ascertainedas may be provided by law. The Legislaturemay Impose a poll tax. It may also Impose occupation taxes, both upon natural persons and upon corporations, other than municipal, in this State.

. . ." doing any business

Section 2 of ArticleVIII of the Constitutionreads in part:

"Sec. 2. All occupation taxes shall

be equal and uniform upon the same class of subjectswithin the limits of the authority levying the tax; but the leglslature may, by general laws, exempt from taxation public property used for public purposes;

. . .'
That part of Section 2 of Article VIII, supra, authorizing the Legislatureto exempt certainpublic property from taxation has reference to property taxes and does not pertain to excise taxes such as those mentioned in Senate Bill 258.

The Courts of CivilAppeals, the Supreme Court and the Court of CriminalAppeals of the State of Texas in numerous cases have held that the Legislaturehas authority to classify different types of business for purpose of taxation so long as the legislation Is not discriminatorynor arbitrary as between the same or like classes of business.

In the case of Hurt v. Cooper, 130 Tex. 433, 110 S.W.2d 896, 901 (1937),the Court in speaking of a greater tax per store on chain stores than on Individual storespointed out the followingdistinctive features: quantity buying, ability to pay cash and receive discounts, skill in buying, warehousing, and distribution from singlewarehouses, capital,unified advertising, superiormanagement, standard form of display, concentration of management In special lines, and standardization.

-275-SenatorA. M. Alken,, Jr., Page.3 (No. C-56)

These distinctive featureswere held to be interrelatedand Interdependent In the ohaln storebusiness.

:’ In the opinion in, Hurt v. Cooper, supra, the Court saidat page 900:

j “That is a definite holding that merchants may’be divided into classes and the classes taxed In differentamounts and accoqlln& ,$odifferent standards; that the consideratlons,uponwhich such classlficatlor@are based are primarily within the cjlscretlon of the Legislature; and that courts can interfere onlywhen ,itis, made,,q@arlyto ,appearthat there is no reasonable baslg,for the,attempted classification. If there is a reasonable basis or, $0 express it differently, if it,cannot be sald~that the Legislature acted arbitrarily, the courtswill not Interfere. Mere differenoes in methods of,conductingbusinesses have long been reoognlzed In this atate a8 sufficient to support,the classlfiqatlonof merchants for the purpose of levying ocoupatlon taxes. For instance, our statutes (seearticle 7047, as amended

P ernon’s Ann~.Clv. St. art. 70471) evy occupation taxes on itinerantmerchants and peddlers. The difference between their ocoupatlonsand that of an,ordlnary merchant is not great, but Itwould hardly be contendedat this time that it Is not sufficient to support a separate classlflcatlon.”
Difference in profits derived, in extent of consumption of articles, and other conditions that might be supposed, can properly be :taken. into coqslderatlonby the Legislature In making classlflcatlonsand In determining the amount of occupation taxes to, be laid,on each.
The mere fact tha$~,d$scrimlnatlon 1s made In classlfications for occupation taxes proves nothing against classlflcatlon which Is not oneits face an arbitrary, unreasonable or unreal one. ,,’

276- ,r- ,

SenatorA. M. Alken,, Jr., Page 4 (No. c-56)

The Court in rendering Its opinion in Texas Co. v. --it= 100 Tex. 628, 103 S.W. 481, 484 (1907) in

### which
an o jectlonwas made that a statutedlscrlmlnat~sbetween persons pursuing occupationswhich 

### belong to the same class, 

### said: -

In The very language of the Constl- &o; of the state Impliespower In the Legislature to claeslfy the subjects,of occupation taxes and only require’s

that the tax shallbe equal and ‘uniformupon the same class. ‘Personawho, In the most general sense, may be regarded as pursuing the same occupation,as, for Instance,merchants, may thus be divided 

### Into classed, and the class&s-maybe taxed In different amounta and,~accordlng to different standards. Merchantsmay be divided Intowholesalers and retailers,and, If t,hiire

be,‘reasbnable

grounds,

### these may be further divided according to the particular 

### clasaea of 

### business In which they may 

### engage. The conalderatlone upon which such classlflaatlon8 shall

### be based are primarily within the discretion of the Legislature. The courts,under the provisiona relied on, can only Interferewhen It Is made clearly to appear that an attempted classlflcatlonhas no reasonable basis In the nature of the businesses classlfled, and that the law operatesunequally upon subjectsbetween 

### which there Is no real difference to justify the separate treatment of them ufdertaken by the Legislature.

. . .

=-i-i% 76 S.W.2d 1060, Tex.Crim. (1934), Appellantwas conv c e on complaint of not having a license for a coin-operatedhandkerchiefvending machine. He claimed that Article 7047A-1 was vlolative’ofArticleVIII, Section 2, In that Itwas not equal and uniform becausepay toilets and drinking cup vending machines were exempted. He also complained because the tax on marble machineswas greater than, and measured by a different standardthan “other similar amusement machines.” Reliefwas denied.

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### Senator A. M. 

### Alken, .Jr.:, Page’5 (No. C-56)



### Wequote from page 1064: II

. businesses of the samegeneral ciaks maybe properly subdivided or reclasslfled where reason exists therefor. Particular attention Is called to this because’there are 

### commodities and commodities, amuse

### mentaand amusements, servloee 

### and services; and, If reason exists therefor, 

### the Legislature maysubdivide or reclassify commodityvending machines, service vending machines, and amusement 

### vending machines. In Qong Wingv. Klrkendall, 223U.S. 59, It Is laid downthat e etate enactment maymake dlscrlmlnatlons, If ’ founded on 

### dlrrtlnctlona not unreasonable or 

### purely arbitrary. ” That the Court.6have nothing to dowith the policy, wisdom, expediency or propriety 

### of legislative enactments Is almost a maxim. Ollre v. State, 123 S.W. 

### 1116 (Tex.Crlm. 1909

In compllanoe with the rule laid down 

### in the above 

### oases, the Legislature has,authority to classify, and by 

### claselfylng to exempt from taxation, certain types of buslnessea, aasoolatlons, corporations 

### or lndlviduals, provided they are equal and 

### unlform uponthe oameolass of 

### subjects within the limits of the authority levying the 

### tax.

Weare 

### of the opinion that the provisions of Senate Bill No. 258 are not arbitrary nor 

### dlsarlmlnatory andthat It la a valid Bill. 

### 1.

SUMMARY Senate Bill No. 258provides for 

### a reasonable classlflcatlon, Is equal andunl

### form ae to the class of subjects affected and 

### Is therefore valid.- .



### Senator A. M.Aiken, Jr.:,?Ps@'6(No. C.-%) i.

Yours vgry truly, WAOQONER

CARR '.Attorney ,Ceneral of Texas

.,:

‘

. 

### JRB:pw " ~, APPROVED: I' ::~ OPINION

COMMITl'E$ "5~" W.V. Qeppert; Chairman JohnReeves Bill Allen JamesStofer Pat Bailey., !' APPRUVEDFORTHEATTORhlEY GENERAL By: Stanton Stone

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