EXAS 

PRICE DANIEL 

ATTORNEY GENERAL 

AU~TXN SI.-IL%XAS 

April 8; 1949 

Senator A. M. Aikin, Jr., Chairman 

&mete ~&ate Affairs Committee 

Irifty-first Legislature 

Austin, Texas 

Opinion No. V-806 

Be: The constitutionality 

of 9. B. 147 providing 

that coo eratives and 

fraterna E associations 

or corporations shall 

pay the same liden 

fees and taxes as other associations or corporations engaged in 

the some or similar 

business. 

You have. requeated tha opinion of the AttornsyQeneral wdWlve tom the constitutionality of 

Seaate Bill I& 147 with ~particular reference as to 

whether or not it vjo.late,s Se&ion 33 of Article III 

of the Texas Constitution, which provides: 

"All bills for raising revenue shall 

.originate in ~the House of Representatives 

but. the Senate may amend or reject them as 

other bills .” 

Seuate Bill No, 147 reads in part as follows : 

“Section 10 Every co-operative or 

fraternal association or ,corporation authorised to do any business of any kind or 

,mture whatsoever chartered by or having 

a~ pendt. OF ~mrtih.icate of authority to do 

business, or. doing business, in the State 
Senator A. M, Aikin,~ Jr.~, Page 2 (V-806) 

of Texas., shall~,be s,ubject to the payment 

of~the same license ~~fees'and taxes as any 

other associationor.. corporation, either 

dome.stic orforeign, engaged in doing the 

same or simi1a.r busines~s in and under the 

laws of,,this State. The license fees and 

taxes herein referred to shall include all 

fees and taxes,of any ~kind or description 

whatsosver, which are now or may hereafter 

be, impose.d,. lev,ied. or provided for by 

and under the. Co.ns&ution and laws of 

this State in behalf of the State or any 

political.subdivision thereof. 

" * . . 

"Section 4. The fact that there are 

many co-operative and fraternal associations 

or..corpo.rations..now engaged. in various kinds 

of business in..Texas.and which pay no State 

orlocal taxes, and which are in direct 

competitions with private. individuals and 

corporations, engaged in the same or similar ~bu.siness in this-State, and paying taxes fors.uch.privilege, and as a result such 

tax-exempt. associations or corporations are 

not.bearing theirs share,of the cost of government, creates an emergency and an imperative~ public.necessity that the constitutional.rule requiring bills ta be read on three 

several~days in ea~ch House be suspended, 

and said.rule~ ishereby suspended, and 

that ~this Act ~shall.,take:effect and be in 

force,from and aft.er itspassage, and it 

is so enaoted." 

This bill if .enacted~,into law will unquea- 

~tionably raise-revenue. 

case ofDay.Land &Cattle 

However, since the early 

Company v. State, 68 Tex. 

526~. 41 S W 865 it has been settled that the provisIona o).~ecti& 33, Article III of our Constitution,, should be..confined to bills.to levy taxes in 

the strict sense of,,the words,~and. not to bills for 

~..,.other purposes which may incidentally create revenue. 
Senator A. M, Aikin, Jr,, Page 3 (V-806) 

The purpose of.Senate Bill No. 147 is set 

forth in Section b,.thereof, wherein it states, "there 

are many co-operative and, fraternal associations or 

corporations now ,engagad ..in various kinds of business 

in Texas and.which pay~na State or local taxes and 

which are fin direct competition with private individuals land corporations engaged,in the same or similar 

business in this State. and Davine taxes for such Driand as a result 

i;ernal associations orMcorporations'to be subject to 

the payment of the same license fees and taxes as any 

mother association or corporatl,on doing the same or 

similar business,and thus..bear their share of the 

cast of gavernment, ~The.bill~.levies taxes in the 

strictsense of the words and shaving originated in 

the.SenaW is inviolat~ion of Se.ction 33, Article III, 

Constitution of Texas, 

. . . ..I& Opinion, No,.. V-860,~ dated March 31, 1949, 

the Attorney General held that Senate Bill No. 376, 

relative to retaliatory reserve and tax requirements 

on foreign insurances companies,, was not a bill for 

raising revenue within the meaning of Article III, 

Section3,3 of~.the Texas Constitution, and can therefore originate in...the..,Senate, The primary purpose of 

Senate Bill Ko.:.376~~is to~.retaliate against the laws 

of other .States...if~ any., which...put a greater regulatory,andtax 'burden, oninsuranoe. companies domiciled 

inthis.State and. doingbusinesain such other States, 

than waehare heretofore put on insurance companies 

domiciled in such other St.at.es, and doing business 

in this .State. In~..carryingout its primary purpose 

of retaliation., the bill may incidentally create revenue Q It 1.s therefore clearly distinguishable from 

..Senate Bill No.. ll+'?,~which~..has for its primary pur- 

.pose..the levy.of,taxes, in order that CO-O erat,ive or 

fraternalasso.ciatione or co,rporations~ wi E 1 bear their 

shareeof the. cost of government. 
Senator A..M. Aikin, Jr., Page 4 (V-806) 

SUMMARY 

Senate Bill No. 147 providing that 

cooperatives and fraternal associat1on.s 

.,or corporationsshall pay the same litense ~fees.and ~taxas as other associationssor corporations engaged in the same 

or similar.business is unconstitutional 

as it is a Bills for.raising revenue originatinginthe Se,nate. Section 33, Article III,,. .Constit,utionf Texas. 

Yours very truly, 

ATTORNEY GENERAL OF TEXAS 

APPROVED 

Gi+ 

?/b--JRST ASSISTANT 

ATTORNEY GENERAL 

DMG/lg