    Hon. John Ben Shepperd              Opinion No. v-1264.
    Seoretary of State
    Capitol Station                     Re:   Several questions relat-
    Austin, Texas                             lng to collecting  addi-
                                              tional franchise taxes
                                              imposed by House Bill 285,
                                              Acts 52nd Leg.,, 1951, ch.
    Dear sir:                                 402, p. 695.
                   Tour request   for   an opinion   Is in part as fol-
    lows:
                  w’upon making a study of the provisions
            of H.B. 285 enacted by the 52nd Legislature,
            particularly    the franchise   tax section, cer-
            tain questions have arisen as to the inter-
            pretation    and administration   thereof.
                   ”. . .

                  “In accordance with the provisions       of
            the resently     effective   Articles  7084 and
            7084,   this office     has collected  from corpo-
            rations presently      in good standing the fran-
            chise tax at the ‘normal’ rate of $1.00 per
            $l 000 of taxable capital,       minimum 0.00,
            ana at the supplemental (Article       70 f e) rate
            of an additional     l/3 of 10% of all franchise
            taxes levied by and due and payable under
            said Article   7084.
.                  “We respectfully ask that you $ve          us
            your opinion in answering the follm!ing           que s-
            tlons:
                  “1.  Do the provisions   of H.B. 285 as
            quoted above require the collection    of any
            additional  franchise  tax before May 1, 19521
                        If so would it cover the entire ie-
            riod   %m   May 1: 1951 to /Lpril 30, 1952; or
                                                           ’   ‘*




Hon. John Ben Shepperd,      Page 2   (V-1264)


     would It cover only the period from Septem-
     ber 1, 1951 to April 30, 1952 in the same
     proportion as that period bears to a full
     year?
            ‘!3ti At what rate is the additional
     tax,   If any, to be computed and
             a.)   when ‘is it due?
             b)    when is it payable?
            (c)    may collection   be made during   the
                   regular tax aollectlon   period   on
                   or before May 1, 19521
                Would the 25% penalty as provlded
     in Ar&e     7091 be applicable  to the addl-
     tional tax, if any,‘and If so, after what
     date would the penalty apple
           “5., Assuming that a corporation   is sub-
     ject to the minimum tax, and has already
     paid $20.67 (the minimum under Article     7064
     and Article  708%) for the period May 1,~ 1951
     to April 30 1952, what additional     amount, If
     any would ge due under the minimum tax pro-
     visfon of H.B. 2851’1
          Attorney General’s Opinion V-1248, addressed
to Hon. John Ben Shepperd, Secretary of State, dated
August 21, 1951, held In part as follows:
           “In Opinion V-1246, dated August 2l
     195l   addressed to Hon. Robert 5. Calve$,
     campt roller  of Public Accounts, this office
     held that House Bill 285 became effective
     from and after September 1, 195l., and all
     taxes of whatever kind or nature included
     therein should be levied and collected     at
     the rates therein prescribed    without re-
     gard to whether such tax was levied on an
     annual quarterly,     or monthly basis-  Hence,
     House Bill 285 imposes an additional    fran-
     chise tax at the rate of 25# upon all corpo-
     rations for the privilege    of doing business
     in Texas in corporate form for the period
     commencing September 1, 1951, through May
     1, 1952.”
:   l




        Hon. John Ben Shepperd,   Page 3   (V-1264)


                   Section IX of-,&use Bill 285 imposes and re-
        quires r;he coiiection ci$ an additional   franchise tax
        at the rate of 25+! per thousand dollars from all corpo-
                                           period from September
                                           ich tax becomes due on
                                             date of House Bill 285.
                                           ., 167 s.w.2a 557 (Tex.

                    Since the Act falls to provide any specific
        date for the payment of the additional      tax, it neoessar-
        lly follows that    the tax Is payable on and after Septem-
        ber 1, 1951, and collection     thereof may be made during
        the regular tax collection    period on or before May 1,
        1952.    We believe the foregoing    answers your questions
        Nos. 1, 2, and 3.
                    The Legislature  did not speolflcally  provide
        that a penalty would attach by reason of the failure       of
        the taxpayer to pay the additional     tax when due, and the
        25% penalty provided in Article 7091, V.C.S., which is
        applicable   only for the failure  to pay the annual fran-
        chise tax due and payable in advance QII or before Mav ;L
          f each tax&&e VW       would not attach by reason of then
        iailure   of the taxpa;er to pay the additional   tax im-
        posed by House Bill 285 on or after September 1, 1951.
                    However, Article  7092, V;C.S.,  provides that
        the Secretary of State, during the month of May of each
        year, shall notify any domestic or foreign corporation
        subject to the payment of the franchise     tax which has
        failed to pay a franchise    tax on or before the 1st day
        of Map, that unless such m           tax is paid on or be-
        fore the 1st day of July next following,     the corpora-
        tion’s  right to do business in this State will be for-
        feited as provided therein.      Therefore, any corporation,
        domestic or foreign,   which fails to pay the additional
        tax imposed by House Bill 285 on or before May 1, 1952,
        is subject to have its right to do business forfeited
        under the provisions   of Article   7092, V.C.S.
                   In answer to question No. 5, a corporation   sub-
          ect to the minimum tax ~which has alread   paid 9520.67
        i the minimum under Artfkles   7084 and 708rr, V.C.S.)is
        subject to the payment of an additional    m&mum tax u11-
        der the provisions  of Section IX House Bill 285, for the
        period September 1, 199 to April 30, 1952, both inclu-
        sive, which is two-thirds    of one year.  The amount of such
Hon. John Ben Sheppira, Page 4      (V-1264)


additional    minimum tax would therefore   be computed on
the basis    of two-thirds of the additional   tax of $5.00,
or $3.33.


             Section IX, H.B. 285, Acts 52nd Leg.,
      1951, ch. 402, p. 695, requires collection         of
      an additional    franchise    tax at the rate of
      25# per thousand dollars upon all corporations
      privileged    to do business In Texas in corpor-
      ate form for the period commencing September 1,
      1951, through May 1, 1952. The, additional         tax
      is due September 1, 195‘1, is payable on and
      after September 1, 195l, and may be collected
      during the regular tax collection        period on or
      before May 1, 1952, without being subject to
      the penalty provided In Article        7091 V.C.S.
      The penalty provisions      of Article   7041, V.C.S.
      do not apply to the additional        tax for this pe-
      riod.    Corporations    subject to the payment of
      an additional    minimum tax are subject to the
      payment of an addlt lonal minimum tax for the
      same period in the sum of $3.33.
                               Yours very truly,
APPROVED:                        PRICE DANIEL
                               Attorney General
Jesse P. Luton, Jr.
Reviewing Assistant
                                  ~{q;~~,(&.&.&
Everett Hutchinson.            BY
Sxecutlve Assistant              C. K. Richards
                                      Assistant
Price Daniel
Attorney General
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