# T~AEA~ORNEY GENERAL OF TEXAS Aus-. We, 78711

April 5, 1974
The Honorable Robert S. Calvert Comptroller ofPublic Accounts State of Texas Austin, Texas 78774
Dear Mr. Calvert: Opinion No, H- 274 Re: Authority ofcities to

collect taxes due under Article 1066c, V. T. C.S., the Local Sales and Use Tax Act You have requested an opinion on the following questions:

“Whether any city has authority under Vernon’s Ann. Civ. Stat. Art. 1066~. common law, or otherwise to engage inany collection activities, including collection onajudgment, for tax liabilities thatarise under Vernon’s Ann. Civ. Stat. Art. 1066c, other thanjoining as aparty plaintiff with the Attorney General in a suit for collection as provided in Vernon’s Ann. Civ. Stat. Art. 1066~. Sec. 12, subsequent toa certification ofa tax liability by the Comptroller to theAttorney General for collection? ”

“In the event any amounts due under Vernon’s Ann. Civ. Stat. Art. 1066~ are in fact received by a city, either legally or illegally, is that city required to either remit the total amount collected, exclusive of court costs, ifany, to the Comptroller or to submit an accounting to the Comptroller ofall amounts so collected? ” The Limited Sales, Excise and Use Tax Act (Chapter 20. TaxationGeneral, V. T. C.S.) was enacted in 1961. The Local Sales and Use Tax Act, Article 1066c, V. T. C.S., became effective in 1967. Itauthorizes cities, towns and villages to adopt a local sales and use tax which is superimposed on the state sales tax in local, taxable transactions.

p. 1280,

The Honorable Robert S. Calvert. page 2 (H-274)

We believe that the State Comptroller is the sole party authorized to collect these local taxes onbehalf ofthe city. Our opinion is based upon the many provisions inArticle 1066~ which contemplate collection ofthe local taxes by the Comptroller. The caption to the Act sets out that it is an act “providing for the administration and collection and enforcement of such tax by the State of Texas. ” (Acts 1967, 60th Log., KS., ch. 36. p. 62). Section 5of the act provides that “the Comptroller shall perform all functions incident to theadministration, collection, enforcement, and operation ofthe tax, and the Comptroller shall collect

. . . an additional tax under the authority of this Act ofone percent (1%)

. . . . ” Itfurther states that the local tax and state tax will be “collected together and reported upon such forms
... . as may be prescribed by the Comptroller.
. . .” Section 6establishes provisions which “shall govern the collection by the Comptroller ofthe tax imposed bythis Act” and Section 4, establishing an excise tax, states that “the tax imposed by this Section ofthis Act shall be collected by the Comptroller on behalf ofand for the benefit of such city. ” (emphasis added) These provisions clearly show that the Legislature intended that the State Comptroller be the central collector ofthese taxes. The answer toyour second question is dictated by our answer to the first and is governed by the same statutory provisions as those quoted above. Since the Comptroller is the sole agent authorized tocollect the Local Sales, Excise and Use tax, any such tax collected by a city in any manner must be paid over tothe Comptroller tobe deposited in the State Treasury for the city’s benefit. In connection with your first question you have referred to $12 of Article 1066~. V. T. C.S., which provides a convenient procedure enabling a city tojoin as a “party plaintiff” in suits brought by the Attorney General to collect delinquent state taxes when a city tax is also delinquent. However, this procedure is not exclusive and a city also has a general common law right tofile suit to recover delinquent taxes. Brummer v. City of Galveston, 76 S.W. 428 (Tex. 1903); City ofHenrietta v. Eustis, 26S.W. 619 (Tex. 1894). See also Article 11, 5$4 and 5ofthe Texas Constitution and Article 962, V. T. C.S.

p. 1281--

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The Honorable Robert S. Calvert, page 3 (H-274)

SUMMARY The State Comptroller is the sole collector of taxes under Article 1066c, V. T. C.S., although cities may independently file suit therefor, and any such tax moneys received by cities should be remitted tothe State Comptroller for deposit in the State Treasury for the cities’ benefit.

APPeCjVED:

DAVID M. KJSNJJAJ Opinion Committee

p. 1282