          TB[EL%TORNEY             GENERAL
                      OPTEXAS




                        April 24, 1959

Honorable Robert S. Calvert   Opinion No. W-606
Comptroller of Public Accounts
Capitol Station               Re: Whether a garage carrying
Austin, Texas                      a stock of parts for in-
                                   stallation on customers'
                                   automobiles for repair la
                                   subject to the store tax
                                   levied by Article lllld,
                                   Vernon's Penal Code, and
Dear Sir:                          related questions.
     We quote from your opinion request as follows:
     "I will thank you to advise this Department whether
     or not a garage that operates under any one or all of
     the four following conditions is subject to the Store
     Tax as levied by Article llllD, Vernon's,Annotated
     Penal Code of Texas.
        "1. Where a garage carries a stock of parts for
     the primary use of installation on customers' auto-
     mobiles for repair and the customers are billed
     separately for the parts and for the labor. In some
     cases the parts are not billed separately from the
     labor but as a complete job.
        "2. Where a garage does not carry parts in its
     stock but on repair or maintenance jobs secures or
     obtains parts from other places of business and in-
     stalls same in customers' cars as repairs, billing
     the customers separately for parts and for labor.
        "3. Where a garage carries in stock automobile
     parts primarily for use in repairs in the shop but
     does make an occasional sale of these parts.
        "4. Where a garage carries a stock of tires but
     does not make independent sales of such tires. He
     does install such tires on customers' cars and makes
     a charge for the tires but no charge for labor. In
     some instances there is an exchange made for the
     customer's old tires and the difference for the new
     tires paid In cash."
Hon. Robert S. Calvert, Page 2 (Opinion No. 606)


     The portions of Article 11116, V.P.C., relevant to this
opinion are as follows:
Section 7:
     "The term 'store' as used in this Act shall be construed
     to mean and include any store or stcres or any mercan-
     tile establishment or establishments not speailical~y
     exempted within this Act which are owned, operated, main-
     tained, or controlled by the same person, agent, receiver,
     trustee,firm, corporation, copartnership or association,
     either domestic or foreign, in which goods, wares, or
     merchandise of any kind are sold, at retail or wholesale."
Section 5(a):
     II. . .Provided that the term 'store, stores, mercantile
     establishment, and mercantile establishments,' whenever
     used in this Act shall not include:. . .garages;. . ."
Section 5(c):
     "All.   .establishments.   .exempted. . .by this Act
     shall file an application'as required by Sections 2 and
     4 of this Act.  If they meet the requirements of this
     Act for exemption, they shall pay an exemption fee of
     Four Dollars ($4) for one store and Nine Dollars ($9)
     for each additional store in excess of one."
The provisions of Article 5 quoted above apply only to garages
which qualify as "stores" under Section 7 of Article lllld,
V.P.C. Garages which make no sales, but render "service" only,
do not come within the affirmative operations of Article lllld;
consequently, the provisions of Section 5, supra, are inappli-
cable to such garages. See Attorney QeneraFsTpinion    No.
v-1389 (1952), a copy of which is annexed hereto.
     The test of a store is whether sales of goods, wares
or merchandise are made at the place in question. Hurt v.
Cooper, 130 Tex. 433, 110 S.W. 2d 896 (1937); Mont ornery
            v. State, 169 S.W. 2d 997, affirme?r-l?&&e
EZ-'iZiCompany
Y(5 S.W. 2d 218 (1943). Standard Oil Company of Texas v.
State, 142 S.W. 2d 519 (Tex.Civ.App. 1940, error refused) and
Humble Oil and Refining Company v. State, 158 S.W. 2d 336
(Tex.Civ.App. 1942 error refused) dealt with the contention
that service stati&s which sold automobile accessories, which
were installed on the customer's automobile at the time of
sale, were not required to pay the store tax because of the
provision of Section 5 of Article lllld 'that the term 'store,
Hon.,Robert S. Calvert, Page 3 (Opinion No. WW-606)


stores, mercantile establishment, or mercantile establishments'
whenever used in this Act shall not include:. . .any place of
business engaged exclusively in the storing, selling, or dis-
tributing of petroleum products and servicing of motor vehi-
cles;. . .I'(Emphasis added). The court in each of these cases
held that the service stations in question were "stores" within
the meaning of Article lllld; the fact that the accessories
were installed on the automobile did not make the transaction
purely a "service," so as to qualify the service station for
exemption.
     We regard the foregoing cases as controlling in the
present situation. If a garage makes sales of parts in con-
nection with its operations, it is a "store" within the mean-
ing of Section 7 of Article lllld; the fact that such parts
are installed upon the automobile in the course of repair is
immaterial, This conclusion is not altered in cases where a
garage submits a bill without detailing the respective charges
for service and for parts.1
     In view of the preceeding discussion, we hold.that the
garages in each of the four situations you describe are
"stores" within the meaning of Article lllld, V.P.C., and are
required to file an application and paysan exemption fee under
the terms of Section 5(c) thereof.

                        SUMMARY
             Garages which make Sales of parts in
        connection with their course of business in
        making repairs are "stores" within the mean-
        ing of the Article lllld, V.P.C., and are
        required to obtain an exemption license under
        the terms of Section 5(c) of said Article.
        The fact that the parts are installed on the
        customer's automobile is immaterial. This


' In this connection see Western Company v. Sheppard, 181 S.W.
2d 850 (Tex.Civ.App. 19443ror    refused), which Involved the
cons&r&ion   of the Act levying a tax upon service rendered
in connection with acidizing wells, etc. The court said that
the sale of acid or materials in connection with such service
was a separable item and "no good reason appears why those en-
gaged in such business could not and should not segregate in
each instance a fixed charge for such service from the sales
prices of their materials at the well head. In the absence of
Hon. Robert S. Calvert, Page 4, (Opinion No. WW-606)


          conclusion Is not altered in cases where a
          garage submits a bill without detailing the
          respective charges for parts and labor.
                               Very truly yours,


                               WILL WILSON
                               Attorney General



                                 Assistant

JNP:bct
APPROVED:
OPINION COMMITTEE:
Geo. P. Blackburn, Chairman
David R. Thomas
J. Milton Richardson
Marvin H. Brown, Jr.
Robert T. Lewis
Richard 0. Jones
FWED     F'ORTHE ATTORNEY GENERAL
  :
   W. V. Geppert




1 (Con't) such segregation and the fixation of a specific
service charge, since the statute expressly taxes only the
service, regardless of the dominant element of value of the
materials used, the most reasonable and practical method of
arriving at the service charge would be the difference between
the fair and reasonable market value of the acid delivered at
the well head and the total gross charge; or if such market
value cannot be so established, then its actual or intrinsic
value at the well head."
