c         .




                                    TTORNEY                  GENERAL
                                       OF TEXAS
                                   Auwrmr.        TEXAS      787ll




                                        October      17,   1974


    The Honorable     Robert S. Calvert                       Opinion No.     H-   424
    Comptroller    of Public _Accounts
    State Finance Building                                    Re:      Whether governmental
    Austin,  Texas                                                     bodies and private persons
                                                                       operating on federal proper-
                                                                       ty must furnish bond required
                                                                       under Art. 20. 021(N)(l),
    Dear Mr.        Calvert:                                           Taxation-General,   V. T. C. S.

              You have submitted   the following     questions      to us for an opinion:

                     1. Are governmental   bodies which must collect
                 the sales and use tax also required to furnish a
                 bond or other security to the Comptroller   pursuant
                 to Art.  20.021 (N)(l), Tax. -Gen., V:T.C.S.?

                      2. Are private individuals who sell taxable
                 property from facilities  located on federal property
                 and which are operated under contractual agree-
                 ments with federal government     entities required
                 to furnish a bond or other security to the Comptroller
                 pursuant to Art. 20.021(N)(l),   Tax. -Gen.,   V. T. C.S.         ?

         The 63rd Legislature    added to the Limited Sales,   Excise and Use Tax
    Act the requirement     that a seller of taxable items must furnish a bond or
    other security to the Comptroller     to secure payment of the taxes that must
    be collected under the Act.     Acts 1973, 63rd Leg.,    ch. 345, p. 776. Article
    20.02 1 (N)( 1) provides in pertinent part:


    .,I              Every person who holds a sales tax permit under,
                 this Chapter as of January 1, 1974, and is delinquent
                 in the payment of any taxes, penalties and/or interest
                 on January 1, 1974. and every applicant for a sales
                 tax permit on or after January 1, 1974, shall furnish
                 to the Comptroller  a cash bond, a bond from a surety
                 company chartered    or authorized to do business in



                                             p.   1968
The Honorable      Robert   S.   Calvert,        page 2   (H-424)




        the State of Texas,     certificates    of deposits,  certi-
        ficates of Savings or U.S. Treasury          bonds or, subject
        to the discretion and approval of the Comptroller,           an
        assignment    of negotiable stocks or bonds, or such
        other security as the Comptroller          may deem sufficient
        to secure the payment of taxes under this Chapter.
        Any surety bond furnished under this Paragraph
        shall be a continuing instrument and shall constitute
        a new and separate obligation in the penal sum named
        therein for each calendar year or a portion thereof
        while such bond is in force.         Such bond shall remain
        in effect until the surety or sureties are released
        and discharged.      The Comptroller       shall fix the
        amount of such bond or security in each case, taking
        into consideration    the amount of money that has or is
        expected to become due from such person under this
        Chapter and under the Local Sales and Use Tax Act.

        .   . .


“Person”   is broadly defined in Art. 20,01(A)     and included within its scope
is “the United States or any agency thereof,      this State, or any agency
hereof,  or any city,   county, special district,    or other political subdivi-
sion of this State to the extent engaged in the selling of items taxable
under this Chapter. I’

     In response to your first question,      then, it appears    that the Legis-
lature intended to require any governmental         body making sa1~e.s subject
to the Act to meet the security requirements        of Art. 20.021(N)(l),     Thus
dny,~g.d,vernmental body~~wh~~h:is,:colle:cfin8rthe   sales tax, as a holder of
a sales tax permit,   must, under Art. 20.201(N)(l),        also furnish whatever
bond or other security the Comptroller        deems necessary:      governmental
bodies holding sales tax permits     are not excused from meeting this
requirement    simply because they .are governmental        bodies.

    The answer     to your second question is provided              by the Buck Act,
4 U.S. C., Sets.    104-110, particularly Sec. 105:




                                            p.    1969
.    r




    The Honorable    Robert   S.   Calvert,    page 3      (H-424)




                 (a) No person shall be relieved from liability
            for payment of, collection    of, or accounting for
            any sales or use tax levied by any State, or by any
            duly constituted    taxing authority therein,  having
            jurisdiction  to levy such a tax, on the ground
            that the sale or use, with respect to which such
            tax is levied, occurred in whole or in part within
            a Federal    area; and such State or taxing authority
            shall have full jurisdiction   and power to levy and
            collect any such tax in any Federal area within
            such State to the same extent and with the same
            effect as though such area was not a Federal area.
                                                                  /
    This provision    was passed by Congress     to enable the states to impose
    sales taxes within federal enclaves.     Humble Oil & Refining Company v.
    Calvert,   478 S. W. 2d 926 (Tex. 1972).    Thus private individuals who
    sell taxable items from facilities   located on federal property are respon-
    sible for collecting the sales tax and, accordingly.     would be required to
    furnish a bond or other secui;ity to the Comptroller     under Art. 20. 021(N)(l).

                                   S UMMARY

                Governmental    bodies which hold sales tax permits
            and which collect the sales tax must also furnish a
            bond or other security to the Comptroller     under
            Art. 20. 021(N)(l).   Private individuals who sell tax-
            able items from facilities    located on governmental
            property are responsible    for collecting the sales
            tax and, accordingly,   also would be required to fur-
            nish a bond or other security to the Comptoller      under
            Art. 20. 021(N)(l).

                                              Very    truly yours,




                                      v       Attorney    General    of Texas




                                              p.   1970
The Honorable   Robert   S.   Calvert.        page 4   (H-424)




DAVID M. KENDALL.        Chairman
Opinion Committee




                                         p.   1971
