                                     The Attorwy              General of Texas
JIM MATTOX                                              December 21, 1904
Attorney General


supremecourt Bulldino               Honorable Bob Bullc ck                           opinion   NO. JM-263
 ‘_0. Box12549                      Comptroller of Public Accounts
 ,“otln. TX. 79711. 2548            L.B.J. State Office Ruilding                     RS: Whether imposition      of the
51214752501                         Austin, Texas    707 74                          limited sales tax on the sale
Telex 9101874-1397
                                                                                     of    newspapers   violates    the
 elecopier     5121475-02S9
                                                                                     First Amendment to the United
                                                                                     States Constitution
714 Jackson. Suite 700
 hllrs. TX. 752u24508
                                    Dear Mr. Bullock:
 141742-8944

                                           Chapter 151 of the Tax Code imposes limited             sales,     excise,   and
 ,824 Ahrta      Am..   Suite 190   use taxes on businwses          operating within this state engaged in certain
 3 Paso. TX.     799052793          specified     activit:tas.       Legislation    enacted    during     the    recently-
915633.3494                         completed special        s:ession repealed   section    151.319 of the Tax Code
                                    which exempted the sale or distribution           of newspapers from the imposi-
 _-I Texas. Suite 700
                                    tion of the sales tax.           Acts 1983, 68th Leg., 2nd C.S., ch. 31, art.
Houston. TX. 77002.311 t            12, 13. at 552.        The sale of newspapers, therefore,        is now subject to
713/223-5888                        the tax.

                                          The First Amendment to the United States Constitution   provides in
808 Broadway. Suite 312
ILubbock. TX. 79401-3479
                                    pertinent   part that “Congress shall make no law . . . abridging      the
 108/747-5238                       freedom . . . of t’hsr Dress.
                                                            .       . . .‘I It is anolicable to the states bv
                                    virtue of the Fourzeenth Amendment. Cantwell v. Connecticut,      310 U.S:
                                    296 (1940).    You aIrk us the following  question:
 4309 N. Tenth. Suite B
  dcAllsn. TX. 78501-1885
 j121882-4547                                      Does zhe imposition of the limited sales tax on
                                                the sale of newspapers violate   the First Amendment
                                                to the Uwtted States Constitution?
 !00 Main     Plaza. Suite 400
 SW Antonio.      TX. 782052797
                                            You assert that     the imposition  of the tax on the sale of news-
 5t212254191
                                    papers ia a direct ‘burden on freedom of the press.            Citing Hurdock v.
                                    ;‘;nf:;riia      , 319 U.S. 105 (1943) and Follett       v.. Town of McCormick,
 9n Equal OpportunityI                             U.S. 573 (1444). you suggest in your letter      that “[t]he  fact
 Affirmative Action Employer        that the sales taK is a tax of general application               does not change
                                    this      basic premls e .”    We disagree.   Subsequent Supreme Court cases
                                    suggest that it does not constitute           an impermissible      burden on the
                                    press.        We conclude    that the above-cited    decisions     are no longer
                                     controlling,     and we answer your question in the negative.

                                          Murdock   v. Pennsylvania. supra. and Its companion cases. Douglas
                                    v. City of      Jeannette.   319 U.S. 157 (1943) and Jones v. City of
                                    Opelika, 319    U.S. Fr(1943).   as well as Follett v. Town of McCormick,
                                    S.C., z,         each involved the application  to religious missionaries



                                                                     p. 1171
Ilonorable   Bob Bullock    - Page 2       (JM-263)




who sold religious       tracts door-to-door        of license   taxes imposed upon
those who sold books.         The court concluded in each Instance that the
tax constituted     an impermisoible burden on the exercise              of freedom of
religion      as    applied      to    itinerant      missionaries.         The     court
characterized       the     activity      of   selling      the    religious      tracts
door-to-door     as religious      wtlvity    and concluded      that imposition        of
the license     tax was a direct burden on the free exercise               of religion.
You suggest that, analogously,           the repeal of the sales tax exemption
for newspapers is likewise an impermissible               burden on freedom of the
press.

      However, these cases /Ire not the court’s          last pronouncement on
this subject.      In Breard v. Alexandria,     341 U.S. 622 (1951). the court
upheld, against a claim tha. it was violative,         of the First Amendment,
Inter alia,    a municipal ordinance which prohibited        peddlers or canvas-
sers from calling      upon the occupants of private          residences  without
having first     been invited   to do so.    The court did not construe its
decision    as having overruled      Murdock and its       companion cases and
Follett;    the dissent.    hovever, explicitly     did so.      341 U.S. 622 at
648.     Any doubt as to the ef feet of Breard on Murdock and Follett,
however,    was dispelled     by the recentzof            Minneapolis    Star and
Tribune Comuany v. Minnesofa Cosnnissloners of Revenue, 460 U.S. 575
11983)    [hereinafter   Minneapolis  Star Tribune].        It is to this case
that we now turn.

      In Minneapolis Star Tribune, the court                 struck down a Minnesota
use tax Imposed on newspaper ink and paper.                    The court declared the
f011ow10g:

                 9.    Star Trib,ane insists           that the premise of
             the State’s      argusant -- that a generally              applic-
             able    sales     tax ,would be constitutional              --    is
             incorrect,     citin:I Follett       v. McCormick, 321 U.S.
             573,    (1944).      Mursiock v. Pennsylvania,          319 U.S.
             105, (1943),        and-Jones v. Opelika,         319 U.S. 103,
             (1943).      We think that Breard V. Alexandria.                341
             U.S. 622 (1951). ,Ls more relevant and rebuts Star
             Tribune’s argument:. There, we upheld an ordinance
             prohibiting      door-to-door      solicitation,     even though
             it applied       to Prevent the door-to-door              sale of
             subscriptions        to magazines, an activity        covered by
             the     First       Amztrdment.        Although      Martin      v.
             Struthers.     319 U.S. 141 (1943). had struck down a
             similar     ordinance as applied           to the distrfbution
             of free religious           literature.       the Breard Court
             explained       that     case    as emphasizing         that    the
             information       distrjbuted      was religious       in nature
             and that the distribution            was noncomercial.          341
             U.S.,     at 642-643.          As the dissent         in Breard
             recognized,        the majority        opinion     substantially
             undercut both mm-.   Martin and the cases now relied upon



                                         p. 1172
liooorable   Boh Bullock      - Page 3      (313-263)




             by Star Tribune, in which the Court had invali-
             dated ordinances           imposing a flat          license     tax on
             the sale of reliSioua              literature.         See 341 U.S.
             at, 649-650 (Black, J., dissenting)                    mince        this
             decision      cannot IN? reconciled              with the Jolles.
             Murdock and --    Martin v. Struthers cases, it seems to
             me that good ludll:ial              practice      calls     for their
             forthright       ove&uL:L”g.‘j           Whatever the value of
             those cases as aut:horlty after                  Breard. we think
             them distinguishal~le            from a generally          applicable
             sales    tax.      In each of those cases,                  the local
             government imposed a flat                 tax, unrelated         to the
             receipts       or income        of the speaker            or to the
             expenses       of     administering          a valid       regulatory
             scheme, as a condizion of the right to speak.                          By
              imposing the tax ss a ccnditio”                    of engaging in
             protected      activtt:/,      the defendants In those cases
              imposed a form of prior                   restraint      on speech,
              rendering        the       tax       highly       susceptible         to
              c0*stituti0”a1          ch.sllenge.         Follett,      ~upra.      at
              576-578; Murdock, j)upra, at 112. 113-114; Jones v.
              Opelika,      316 U.S. 584, 609, 611 (1942)                    (Stone,
              C.J., dissenting).          reasoning approved on rehearing
              in 319 U.S. 103 (1943);               see Crosjean v. America”
              Press Co., Inc..          :!97 U.Srat          249; see generally
              Near v. Minnesota            ex rel.        Olson,    283 U.S. 697
              (1931).     In that ;:egard,           the cases cited by Star
              Tribune do not resemble a generally                        applicable
              sales    tax.     Indeed, our cases have consistently
              recognized       that uondiscriminatory               taxes on the
              receints       or     income       of     newsoaners        would     be
              permissible,      Branzburg
                                --              v.   Rayes.    408   U.S.   665,   683
               (dictum);     Grosjewl V. American Press Co.. Inc.,
             supra,      at 250 &ctum);               cf.   Follett,     supra.     at
              578 (preacher          subiect        to taxes       on income or
              prope;y)       (dictual);- Murdock, s.                at 112 (same)
               (dictum).      @mphesis’added).

 Minneapolis     Star Tribune,       l’r,. 9.

       The First   Amendment <.oes not prohibit       all   regulation  of the
 press; there is no question that the states or the federal government
 can subject   newspapers to generally     applicable     economic regulations
 without violating    the Constitution.      As the court in Grosjesn         v.
 American Press Co., Inc., !EE,      declared:

               It is not intended by anything we have said to
               suggest that the ovnera of newspapers are immune
               from any of the ordinary   forms of taxation for
               support of the prernment.




                                            p. 1173
lionorsble   Bob Bullock   - Page 4      (JM-263)




297 U.S., at 250.      See. e.g.,  Cit~iaen>blishing        Co. v. United States,
394 U.S.~ 131 (1969r. (antitrust       laws);  Lorain     Journal   Co. v. United
States,    342 U.S. 143 (1951) (antitrust       laws);     Breard v. Alexandria,
supra    (prohibition    of door-to-door      solicitation)     ; 5)klahoma Press
Publishing Co. v. Walling. 227 U.S. 186 (1946) (Pa:.ir Labor      __~~~ Standards
                                                                          ~~~ ~~
Act); Habee v. White Plains Publishing Co., 327 U.S. 178 (1946) (Fair
Labor StanwAct);Assod.rlted ---          Press v. United States,        326 U.S. 1
 (1945) (antitrust    laws); Associated Press v. NLRB. 301 U.S. 103 (1937)
 (National Labor Relationsxc);        see also Branzburg v. Hayes, 408 U.S.
665 (1972) (enforcement of :rubpoenas)           In Minneapolis      Star Tribune,
 the court struck      down the tax. not because it had the effect               of
 imposing a burden on the press, -but because the press was singled out
 for special treatment:

             Minnesota,    however,, has not chosen to apply Its
             general sales and use tax to newspapers.          Instead,
             it  has created a cpeclal      tax that applies only to
             certain    publicatic’ns     protected   by    the    First
             Amendment. Although the [sItate         argues now that
             the tax on paper and ink is part of the general
             scheme of taxation,      the use tax provision     . . . is
             facially   discriminatory,    singling out publications
             for treatment that is. to our knowledge, unique in
             Minnesota tax law.

460 U.S.,    at 581.    The court     then set forth     the following      test:

                 By creating thi.s special use tax, which, to our
             knowledge. is without parallel            in the State’s      tax
             scheme. Minnesota has singled             out the press for
             special    treatment,      We then must determine whether
             the First Amendment:permits such special              taxation.
             A tax that burdens rights protected              by the First
             Amendment cannot          stand unless        the burden        is
             necessary     to ach,leve an overriding           governmental
             interest.      See, ck:gr, United States v. Lee, 455
             U.S. 252 (1982).       Any tax that the press must pay,
             of course, imposes some ‘burden.’             But, as we have
             observed,     see 255,       at 581. this Court has long
             upheld economic regulation            of the press.           The
             cases approving such economic regulation,              however.
             emnhasired       the   kenera
                                    -.         aDDliCabilitV
                                                 . .                 of    the
             challenged      regulation     to all      businesses,     a.
             Oklahoma Press Pc.blishing Co. v. Walling. supra,
             at 194; Mabee VI White Plains                Publishing      co.,
             supra. at 184; Associated        Press v. NLRB, supra, at
              132-133 sunnest%a        that a regulation       that singled
             out the pr.&s        q:&:ht place a heavier          burden of
             justification      on !:he State,       and we now conclude
             that the special       problems created by differential
             treatment do indee’d impose such a burden.



                                        p. 1174
Honorable   Bob Bullock   - Page 5     (JM-263)




      The Texas scheme of taxation.       as opposed to the Minnesota scheme,
does not single out the prew for special treatment.           On the contrary,
the repeal of the sales tat exemption merely subjects            newspapers to
the generally   applicable     lialited sales , excise, and use tax imposed on
other businesses.       Prior to the repeal,      newspapers were singled     out
for special   favorable    treatwnt;    that is no longer the case.      Accord-
ingly, we conclude that the! imposition         of the limited sales,    excise,
and use tax on the sale of newspapers does not violate                the First
Amendment.

                                 SUMMARY

                The imposition of the limited  excise   and use
            tax on the sale of newspapers does not violate  the
            First Amendment.


                                               Very I truly   your
                                                                     74 AA

                                               LJ-/!y
                                               JIM
                                               Attorney   General of Texas

TOMGREEN
First Assistant   Attorney   General

DAVID R. RICBARDS
Executive Assistant Attorrwy     General

RICK GILPIN
Chairman, Opinion Committee!

Prepared by Jim Moellinger
Assistant Attorney General

APPROVED:
OPINION COlMITTEE

Rick Gilpin,   Chairman
Colin Carl
Susan Garrison
Tony Gulllory
Jim Moellinger
Jennifer Riggs
Nancy Sutton
Bruce Youngblood




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