Hon. George H. Sheppard    Opinion No. O-2304
Comptroller of Public      Re: An individual who owns tank
  Accounts                 cars in which,he transports his
Austin, Texas              own gasoline and who does not
                           lease, rent or charge mileage for
                           said cars is not required to make
                           the reports or pay the occupation
Dear Sir:                  tax under ,Art.7062.
          This is an answer to your request for an opinion in
which you say:
          "An individual, residing without this State,
     owns a certain number of railroad tank cars. He
     loads them with gasoline at Sweetwater, Texas,
     for delivery to a certain oil company in Fort Worth,
     Texas, and pays the freight himself, at Fort Worth.
     He receives the benefit of the mileage allowance
     under regularly published tariff authorized by or-
     ders of the Interstate Commerce Commission.
          "Is this individual required to make reports
                                                  7062,
     and pay the gross receipts tax under ,lirticle
     R.C.S.?"
          In a second letter on this question you gave us ad-
ditional facts as follows:
          "The owner of a tank car loads said car at
     Sweetwater, Texas with gasoline and makes out a bill
     of lading on same for delivery to himself at Fort
     Worth, Texas, the Texas and pacific Railway Company
     moving said car as per bill of lading. The Texas
     and pacific Railway Company then presents freight
     bill at the destination under the rates and terms of
     regularly published tariffs of the Interstate Com-
     merce Commission.
          "iitregular intervals, the Texas and Pacific
     Railway Company under regularly published tariffs
     of the Interstac e Commerce Commission, pays to the
     owner of said tank car the equivalent of l& a mile
     for each mile which said car traveled loaded on
     lines of said railway."
Hon. George H. Sheppard, page 2.


          ,Aswe interpret the facts, these tank cars are used
to transport only the owner's property. The owner loads the
car at Sweetwater and the railroad company moves the loaded
car to Fort Worth, where the owner pays the freight on the
load at the same rate as if the property had been transported
in the railway company's own car. At regular intervals the
railway company pays the owner of these cars l&? a mile for
each mile it was used, that is, traveled, while loaded.
          The answer to your question must be determined by
the construction to be placed on Article 7062 of the Revised
Civil Statutes, which reads as follows:
          Viach individual, company, corporation or
     association, residing without this State, or
     incorporated under the laws of any other State
     or territory, or nation, and owning stock cars,
     refrigerator and fruit cars of any kind, Q&
      a s of any ku,   coal cars of any kind, furni-
     isa;iars or common box cars and flat cars, &
           g. renting or charging mileane for the use
     of such cars within the State of Texas
     shall make quarterly, on the first day: of Jan-
     uary, April, July and October of each year, and
     report to the Comptroller under oath of the in-
     dividual or of the president, treasurer or su-
     perintendent of such company, corporation or as-
     socation, showing the amount of gross receipts
     from such rentals, or mileage, or from other
     sources of revenue received from business done
     within this State, during the quarter next pre-
     ceding. Said tndividuals, companies and corpor-
     ations, and associations, at the time of making
     said report, shall pay to the Treasurer of this
     State an occupation tax for the quarter beginning
     on said date equal to three per cent of said
     gross receipts as shown by said report." (Under-
     scoring ours)
          It will be noticed that the part of the statute with
which we are concerned says that "each individual ... owning
.e. tank cars of any kind ... and leasing, renting or charging
mileage for the use of such cars within the State of Texas"
shall make the required reports and pay the prescribed occupa-
tion tax. Under the facts that you have given us the Individual
owns tank cars. But, is he engaged in "leasing, renting or charg-
ing mileage for the use of such cars"? 'We think the answer IS
"No".
_,.   -
      Hon. George H. Sheppard, page 3.


                It is true that the owner of the cars is paid a sum
      of money by the railway company that transports the cars at a
      rate of so much per mile while loaded; but, we do not believe
      this is an arrangement by which it can be considered that the
      owner is leasing or renting the cars to the railway company.
      Nor do we consider that the owner is charging mileage for the
      use of the cars. @hat it amounts to is this: The individual
      in question furnishes his own cars to haul his own property,
      and, of course, he is entitled to pay a less transportation
      charge to the railway than he would be if the railway furnish-
      ed the cars; and instead of paying a smaller freight rate, the
      individual in this case pays the same rate that he would pay
      if the railway furnished the cars and the railway in turn
      hands him back l& per mile.
                If the railway was allowed to haul other people's
      merchandise in this car-owner's cars, and said car-owner was
      paid l&2 per mile by the railway for so using the cars that
      would constitute "leasing, renting or charging mileage for the
      use of such cars"; but, we understand that these cars are used
      only to haul the car-owner's property.
                This statute was apparently intended to apply to car
      owners who leased and rented their cars to others or turned
      their cars over to other persons and charged mileage therefor,
      for such other persons to haul their (said other person's) mer-
      chandise or haul merchandise for hire as a common carrier. We
      do not believe it was intended by the legislature that this
      statute apply to cars used exclusively for hauling the car-
      owner's olinproperty.
                Our answer to your question is that under the facts
      that you give, the individual you ask about is not required to
      make reports or pay the gross receipts tax under Article 7062.
                Enclosed with this opinion is the correspondence that
      was attached to your opinion request.

      APPROVED JUN 11, 1940              Yours very truly
      /s/ Gerald C. Mann                 ATTORNEY GENERAL OF TEXAS
      ATTORNEY GENERAL OF TEXAS          By /s/ Cecil C. Rotsch
                                         Cecil C. Rotsch, Assistant
      APPROVED: OPINION COMMITTEE
      BY:       BWB, Chairman
      CCFl:kd:wb
      enc.
