OFFICE OF THE ATTORNEY GENERAL OF TEXAS 

AUSTIN 

Q-C.MANN 

m.ieuuv.- 
Ronorabla Cleorgo x. Sheppard, pa&r P 

aal oompaay, oorpontion of esroaiation, 

at the tir oi makiag se14 raport for an7 

saoh lnoorporatrd town or olty ot aoro than 

ow thousand (1,000) inhabitante end lerr 

than two thoumAn rite huahrod (6,600) 

habitantr, aooordfn& to the la8t Tadoral 

lacOlA8U8 next preoedlng th@ filing of reia 

report, #hall pe to the Trrartwer of thir 

@tuta 8n oooupet I on tax for the quarter brginnl~ on 8aid date l quel to forty-four 

huaaraathr (,44) or one (1) per aent 0r 

8tIid go88 reOOipt8, 88 8hOwa by 88ia rOport1 eta.@ 

"%lOr0 I8 nOT 801b t0 the OODlW.%3T wlthln 

the lnoorporated town8 a liqaeilsd petrolown gns. 

Thl8. ga8, a8 a rule, 18 aellrared to,thr aon8umer In liquid form and in ordrr to ntaln it8 

1iqUid 8t8t8, it aU8t be k8pt WidOr high prbr8ur8 but when mleaaed iOr the barnar tip, it 

tWI.I8 to 8 gar vapor. There era lnstanoer where 

l tank 18 lnrtalled on a lot from wh lo h l nunher of auotomerr are taken ean of by the ga8 

brfng plprd to thr ho3148) in thlr oaae, a8 In 

the inaitiaual 0880 e8 80011. a8 the praaenm 

ir rolaasrd at th8 task the gar rapor 18 fox-reed 

and piped from hOU8. to house. " 

tilea tall QI if the gros8 raoalpt8 tax, 

unaer tbo above rrtirlo, wIL1 

wham ?a848 within the 

a ply toruoh ralrr 

laoorpora % od tona8,* 

ft IQB~ be 88on that the artiole JOU quote la 

rour letter oontainr two rrquirementr betorr an lndlrldual beam08 liable for thr tax dilOU8S@d therein. tn 

the flrrt plaoo, In nlation M the question8 asked, 

the lnalrlauel muat operato within aa lnoorporatod olt 

-any gar p1ant.R Also thr same must be umd *ior looa I 

la10 snd d~rtrlbutloa of gall.* The tax is based upon 

the gros8 amount reosived from the burlns88 dono in ths 

papant of oharger for thr galra fou havs iurairhtipr 

with the l ddltlOn81 iaOt8 that the llguld la8 in 'qtI@Stlon 18 a aomponeat p8rt or ~orltrtito of natural aa8 

a.hiOh ir liquefied by pressure and teaperaturo. In itr 

natural 8tate it i8 a gba. It la ml6 to the oonsuaer 

‘h 

. 
,*. 

786 

Honarablr Ceorgo fl. Shepperd, pago 8 

either e8 l liquid or a8 a ear* Prior to it8 ocummption it roturnr to it0 @S.OU@ state. rho fir8t queatlon arlroo a8 to whet&m ot not tho ooeeodltf you inquire tbaut 18 gas titbln t& waning 0r the above quoted 

8 ttItUt8, YOU hW 6aVi8Od U8 that tk OCWtiit~ i@ 

3itih8r a prOpQll8 Or 8 bltM0, 

Fro~ano 18 dofinod 8)f XOb8t6r a8 fOllOW8: 

. 

-ithOr sf tu;o iaowrio, mhi6bh, gaseoaa bydrooarbaona, Cd Hlg, of the iwthna rerier; 

l c l .- 

20th 0f the abOV@ dbfinftioo6 MOO@LO th# 00~1 

aoalty to bc a fe.?ecus I%b8t.WIOO. It i8 our uder6%bllbg 

that tD6 E0;;:O i8 li~USfi3d b'y p.36~r a&d taXp.iIMXI% 

ror pu~oaee or trene,norting and handling. fn this oonmotion tts Amtic Couxt af Civil A~;,tialr in the oasa of 

bALLA CA6 CO?.PAHY v. 8TATE 

reruned by ttie Soprem Ccur 4, 

861 3,?i, lCa!J -wit oi error 

nt.;tob in ooh\eotlon with 

thr taxing rtatute tuxIsr OOn6id8r6aiOiI hero, 80 follrmst 

"In iti8 8eaOnd &ropOUibi0n, bawd upon NJ0f@!Snt8 7 Ma ii, app8lht 00~t(d?U thGt tL'.O 

t6nS ‘&18’ 83 U36a b th0 #mUtO 388111 Otiy aE 

a8 end doen not lnolude nature1 aor* 

era Oar' Trust Co., 

(Vndrr8aorlng: ourr) 

T!UUI the court or Civil Appsela ladioctes that 

thr tam 998' i8 to be broad17 aanetruea a8 to ~~37 typ 

of $bS. 

20 believe that the 16llFWg8 Or the to% 3tltUtU 
xonorablb (korgo 8. 8hqqUd, pago 4 

la ~ur8~lOIl is bror4 waough to Inuludo butaaa 884 propan0 pm whothrr a014 in llquld or grr*ow Itate, Tbm 

A&a In theensrgonoy olaasa of th@ mboro wotsd 

Aat, the teglrleturo Hated II follwat 

*ZSoo, 6, The fret tha% la the pert few - 

nekr hundreds of lives ban be lort tm 

oauser rggarentl 

latoa w rxp1011 

dua to eroap G& or ad- 

~a#) rad that mserou8 l uoh 
,., 

‘788 

Xonorablr Qoorga H. Sheppard, Pa@ I; 

a n l mer gena ~ + l * .I 

It la our opinion aa anauer to the rlr8t quaatioa that llquld p&roleun gas la gaa within thr maanlng 

of Ar6lola 9060 a s l meaaaa b y x o urr Bill 8, Aotr or the 

Forty-aarenth Laglrlature, 19U. 

Ia answer to thr rrooad quo&ion, ua are adtlaed that the lndltlhala or 00 

‘s 

oration8 that a&l thir 

transport thr nnm l th a r by maana ot plpa llna 

mana sf fsuoka oarr~l.n& tamJt8 oi tlm 

atate, The quaatlon l rlaa# aa to whether the oparatfon OS aueh wthod of transportation puts 

the Individual or oorporatfoa within thr oate6orT ot oparating a “gas plant= aa that term is used In Artlola 

7060, aupra. The Auatln Oourt oi Olril Appaala in the 

aaao of WPILITI75S NAlURAL CA3 00. ve STATIC, 118 S.W. (24) 

299, in dloouealng the definition of the term “gas plant” 

within tha meaning of Artlale 9060, rtated as folloua1 

“The 801s oontantlon of appellant ir W&at 

It la not a ‘gar hat@ within the maan 

t&a term as used % the atatuta, baoauae 9 

owaa and operates- a da& ~~1 

t only 

Iii-. 

line anawla~- .-- ~-’ 

t;;,;o only one ouatomer with the olty oi VloWe have raaohetf the oonolualon that when 

tha aixdute in oonatmad ?ron its fopr oornara 

and ln the light of tha purpoaa of its enaotmnt, 

it oammot be so liaitabr 

*It la true the atotuta designates the 

tax as *en oooupatlon tar’, but It alearlr appaara from the language usad that the tar la 

an rxolss laid on bualneaaea 'owning, operatlalt 

zr,y;finnor ooatroll.ln(t any gar I) * 1 plant 

any lmeorporated town or a tr l u 

for looal sale and dlatrlbutloa * e + oi a.* 

Grog No, 1 011 00 f* Sheppard, Tat. U r v* - 

App., 89 8.W. (e*)%fi1, 0-r rei,{ Trustwa 

of Oook’a Nat&e 1. Sheppami, Ter. Oivr Qp., 

89 3.~. (2d) 1026, error raf., affirmed bytho 
789 

Eonorebla Osor@ lL Shappard, Page d 

in ray manner tha km *&a8 ~laa$* as indlaatlro 

of the buai.naaa sought to ba taxad. Paarloaa 

“‘In S BOW. Law Dlot., Rawla~a Third Ravlelan Q. ?W9, the word or form 1 

fined as balag ‘the furalturaa a ai 

lantl la datoolr aeeesear to aarrf on any trada or xnaohanloal bualneaa.~ 

A h I ghlq oamplax SC l laborata SYStSm la not aaoaIaaq, but tha moat l .impypm wharaby the baalnoaa of l alllng and d a 1 ding 668 to looal 

~trada wlthin 

aufrloo 

laaorporataa oltr or tow31 will 

n&or “y; t a ta x inl g tat~ta q ak~aa plaat. 

Under this ml8 the pip lina SyStM and a parataa 

of appallant looataa in tha oft7 of tlotpr s a, * 

whrraby it aalla and d811?8~4 gas to lull trade, 

aonatita$as its gas plant br aad thrcugh whlah 

it aarrlea on ltr &as bualaaaa In said olty, ana 

a~~,,“. tha bualaaar intended to ba temd br tha 

. 

“lb**. 

Tha 8our$ further stated that tha aala bl th@ 
790 

%onorsblr oeorgr H. Sheppard, Page T 

Vtllltler ZJatonl Oar Gon~q by pip, ISno to 0n.l~ OM 

oustonnr ln the olty of Yiotoria amounted to a dirtrlbutlon of the gal in raid oltf within th8 meaning of tk8 

tax rtatuto. The 00nn~la010t1 0f bppeLil8 rWer804 th8 

Auotin Oourt O? 01~11 AppmlD in an 0pin10n mpOrfed in 

12S 8.8. (26) 115% The Oomzairrion aid not qnunl with 

the definition of *gaI plant* stated by the Auotlu Oaurt 

of 09.~11 hpgealr, but the Oommiralon of Appeal8 held that 

the 8alr to a 8ingle ouetomer ia ths olty of viatoria did 

not amowit to W8e for looal asle l b.dl8tributlonm of 

gas l.n the city 58 the statute contemplated. The Oommiroion of Appsclls aonoluder as fo~ow81 

REut oonsfderod in the light of the prorl- 

#ions of tho statute, ar a whole, ‘wo have no doubt 

that the slmplo fact that h del$rury of gas is 

made In the olty, by meens of enid pipe llna to 

a alngle oustomor and to noboQ else, wea not lntended by the Legislature to ke oomprehended by 

the term qdlstrlbutlonS a8 1.~66. This term a8 

a6eQ doer BOt men the tranRfer, Of the ~0884!38iOn 

of gas, by mean8 of the plpa line, to a rlnglo 

purohasor whefl 8uoh pwoilauer is the only ouatomer to whom the gas oomyany sells ear La the 

alty. It -3nr the tranofer 0r p038ee0ion 0i 

.gea ti rarioua individuals or OOnOerB~ in th . 

oity.,~ An7 other ooxattruotlon of the term would, 

In our opinion, involvo a 6.uprrtTjre Srom th* 

leglulntim Intent. SiEoqp therefore, the ~130 . 

of ‘ear-works,’ in c olty ,~r to+n in thlr State, 

for the distribctlon ci giils in Doid oitr of tom 

is, by rtetute, ;nrde an, essential oharaotarlrtle 

of the bueiners tax&l, it followa that the burlneeo $n which tho plaintiff in error i8 engagrl, 

80 dlmO88d by the IUdlS,%te& ia#tE, 1s not 

aubjact to the trx nhtoh thi8 Statute prOvib8~" 

It ir tb.0 oginlon cf this Eepartmant in line 

with the above quoted oa8e8 that an7 lndlildual or oorporation srlllng or aistributln~ liquid petrolau gss to more 

than one oonhxzer in ay Loorgoratea alty rithti the populctiou brcrokete stetec? i,n Artlole 7000, $9 ameesnded by 
Honorablr OeOrga IL Shapperi, P8ge 8 

Houe6 Bill 0 Aatr of thr Yorty-roronth tsglrlaturo 

1941, would k aubjrot to bha gross rroolptr tar 1erf.d 

Yours vary truly