: E 

Mr. Robert ,S. Calvert 

Comptroller of 

State of Texas 

Austin, Texas 

Opinion No. ~~-1280 

Public Accounts 

Re: Whether tax refund may 

be made on special fuel 

delivered by the user 

thereof into the fuel 

supply tank of a motor 

vehicle, under the provisions of Chap. 10 of 

Title 122A, TaxatlonDear Mr. Calverr;: tieneral. 

You ask the opinion of this office relative to two questions 

concerning refund of the State excise tax imposed on Special 

Fuels by Chapter 10 of Title 122A, Taxation-General, V.C.S., and 

which fuels have been delivered by the user Into the fuel supply 

tank of a motor vehicle. Your questions are as follows: 

“1. Does Article 10.14(3). . .preclude 

payment of a tax refund on any part of a 

delivery of special fuels into the fuel 

supply tank of a motor vehicle for propulsion on the highway which is used to 

operate stationary air condit~ioning units 

installed on said vehicle? i 

“2. If you should hold that payment of a 

tax refund as described in Question 1, is not 

precluded by law, then the Invoice required 

by Article lO.14(2) to be Issued at the time 

of appropriation for use and not thereafter 

ard a copy filed as part of the claim, could 

not be issued until after the fuel had been 

used since the quantity used in such air 

conditioners would be computed from the perhour use factor. In such case, could the 

Comptroller accept, as consistent with the 

law, an invoice issued at the end of the 

day or other operating period showing the 

total gallons appropriated and used in such 

air conditioning units when such invoice is 

filed as a part of the refund claim?” 

. . 
Mr. Robert S. Calvert, Page -2 Opinion No. ~~-1280 

;: : .:,, 

We answer your first question “Yes”. This answer precludes 

our answering your second question. 

The facts which have given rise to your questions are 

stated by you as follows: 

“The San Antonio Transit System, owned 

and operated by the City of San Antonio, 

has asked for an opinion as to whether or 

not It can compute the tax on special fuels 

used In Its bus air conditioning units for 

tax refund purposes in which the fuel Is 

not physically measured but is based on the 

quantities shown to have been used each hour 

of operation In tests made on each type and 

model air conditioner used. 

“The speclal,fuels purchased by the San 

Antonio Transit System is predominantly 

for delivery into the fuel supply tanks 

of its vehicles for use on the highway. 

Article 10.11 classifies such operation 

as a non-bonded user required by Article 

10.03(3) to pay the tax to its supplier 

with the right granted by Article 10.14(l) 

to claim tax refund on the fuel used for 

any purposes other than propelling motor 

vehicles on the highway (such as use in 

’ ” ’ .“‘~‘a& conditioners). 

“Its air conditioning units are operated 

while the vehicles are being propelled over 

the streets with fuel supplied from the same 

fuel tank used to propel the motor vehicles. 

The flow lines to the air conditioners are 

not equipped with meters or other measuring 

devices to measure the fuel used in such units. 

“The San Antonio Transit System proposes to 

account for the special fuels used in such 

air conditioners on an hourly basis computed 

as follows: some of the air conditioners 

would be tested with measured special fuels 

while operating. . . to determine the quantity used per hour of operation. The hourly 

quantity so determined would be multiplied by 

the aggregate number of hours all of the air 

conditioning units operated during the month 

to establish the total gallons used and tax 
. . 

Mr. Robert S. Calvert, Page 3 Opknlon No. WW-1280 

refund claims would be filed on the total 

gallons shown." 

In 1959, at Its Third Called Session, the ,56th Legislature 

enacted the present "Special Fuels Tax Law" (sometimes hereinafter referred to as this Law). This Law is Chapter 10 of 

House Bill No. 11; this House Bill constitutes Cha ter 1 of the 

Acts of this Third Called Session, shown at page 1 1 7, et seq., 

of the Official Acts of the Called Sessions of the 56th Legislature. Chapter 10 of this House Bill is codified by Vernon 

as Chapter 10 of Title 122A, Taxation-General. 

Article 10.14(3) of the Special Fuels Tax Law reada as 

follows: 

"(3) Any dealer or user who shall file 

claim for refund of the tax on any special 

fuel which has been delivered into the 

fuel supply tank of a motor vehicle, or 

who shall file any invoice in a claim for 

tax refund upon which any date, figure, 

signature or other material information 

is false or Incorrect, shall forfeit his 

right to the entire amount of the refund 

claim filed." (Underscoring added.) 

We believe that this Section (3) controls and prevails over all 

other provisions of this Law relating to refund of taxes on 

special fuels. Further, we believe all of the refund provisions 

relating to special fuels must be strictly construed In that they 

are in the nature of exemptions from taxation. City of Longview 

v. Markham-McRee Memorial Hospital, 137 Tex. 178, 152 S W 2d 

1112 (1941) State v. City of El Paso, 135 Tex. 359, 141 S.W.2d 

366 (1940),'4-, Sec. 74. Very clearly 

the Special Fuels Tax Law i& complete In every respect with 

reference to the authorization for, and the manner of making 

claim for and payment of refunds of the tax paid to the State 

on all special fuels. 

We observe that this Law makes distinction between: 

One: Appropriation for use of special fuels (see 

Sections (1) and (2) of Article 10.14). 

Two: Use of special fuels, whether to propel motor 

vehicles upon or off the public highways, or 

for some other purpose (see Articles 10.14(l), 

10.05(2) and 10.12(3)). 
Mr. Robert S. Calvert, Page 4 Opinion No. ~11-1280 

Three: Delivery into the fuel supply tanks of motor 

vehicles. (see Articles 10.03(5), 10.13(k) 

and 10.14(3)). 

Article 10.03 of this Law, which levies the tax on special 

fuels, In Section (5) states in part: 

“Every user shall report and pay to this 

State the tax, at the rate Imposed, on 

each gallon of special fuels delivered 

by him into the fuel supply tanks of 

motor vehicles, unless said tax has been 

paid to a licensed supplier. . . .‘I 

We do not believe that the special provisions of Article 10.08 

which authorize the Comptroller, in his discretion, to use a 

mileage basis in determining the amount of tax due to be appllcable to the fact situation under consideration. Further, we 

do not believe that you are authorized by Article 10.21 of the 

Law to promulgate rules and regulations relating to the ellglbillty of special fuel for tax refund which would conflict with 

the clear mandatory provisions of this Law which relate to 

special fuel which has been delivered into the fuel tanks of 

motor vehicles. (Articles 10.03(5), 10.13(Q) and 10.14(3), 

hereinabove mentioned.) 

.We recognize ;4hat Article 10.03(l) levies and imposes the 

tax only upon the e . .use of special fuels for the propulsion 

of motor vehicles upon the public highways of this State. . . .” 

However, with reference to refund of the tax paid upon special 

fuels which have been delivered by the user into the fuel supply 

tanks of motor vehicles, we believe that Section (5) of this 

same Art. 10.03, construed together with Articles 10.13(b) and 

10.14(3) make clear that all such fuels have been used for a 

taxable purpose. 

SUMMARY ‘, 

Special fuels delivered by the user 

thereof into the fuel supply tank of a 

motor vehicle are not subject to refund 

of the excise tax paid on that fuel under 
. 1 

Mr. Robert S. Caluert, Page 5 Opinion No. ~~-1280 

the provisions of Article 10.03, Title 

122A, Taxation-General, V.C.S. 

Yours very truly, 

WILL WILSON 

Attorney General of Texas 

WEA/rk 

APPRCVED: 

OPINION COMMITTEE: 

W. V. Geppert, Chairman 

Arthur Sandlin 

Henry Braswell 

Virgil Pulliam 

John Reeves 

REXIEW FOR TRE ATTORNEY GENERAL 

By: Houghton Brownlee, Jr. 

Assistant