                           December      14, 1948


Hon. M. B. Morgan                           Opinion    No. V-735
Commissioner
Bureau of Labor Statistics                  Re: May municipalities   levy an
Austin, Texas                                   occupation tax upon licens-
                                                ed employment    agencies
                                                that send employees    out of
Dear    Mr.   Morgan:                           State and related question.

              Your   opinion   request   reads,   in part,   as follows:

             “Section 6 of H. B. 264, Regular Session, 48th
       Legislature,    provides for an occupation tax on
       agencies    sending employees      out of the State, and
       further provides     the method whereby      said occupa-
       tion tax is to be paid.     Under the provisions     of this
       Section a county occupation tax is levied upon a
       population basis according       to the preceding Fed-
       eral Census.     Nothing is mentioned in said Sec-
       tion with reference     to the levying or collection of
       an occupation tax by municipalities.

             “Therefore, I would appreciate   your advice and
       opinion as to whether or not municipalities    would
       be acting within their authority in levying an occu-
       pation tax upon licensed employment     agencies op-
       erating within their jurisdictions,  and if so, upon
       what basis would such an occupation tax be com-
       puted.

             “2. If you have answered  the first part of
       question 1 in the affirmative, then please advise
       me whether or not an ordinance worded as follows
       would be valid:

            “‘There  shall be levied and assessed   against
       and collected from every person, firm, corpora-
       tion and association   of persons in the City of Aus-
       tin which is taxed by the occupation. tax laws of
       the State of Texas, an occupation tax equal in
       each instance to one-half (2) of the occupation
       tax levied by the State of Texas on each occupation
       or separate  establishment.‘“’
HOA. M. B. Morgan,        Page   2 (v-735)



           Section    1 of Article    VIII of the Texas    Constitution   pro-
vides:
           Y
            . . . The Legislature  may impose . . . occupa-
     tion taxes, both upon natural persons and upon cor-
     porations,    other than municipal, doing any business
     in this State . . . the occupation tax levied by any
     county, city or town for any year on persons or cor-
     porations pursuing any profession     or business,    shall
     not exceed one half of the tax levied by the State for
     the same period on such profession      or business.”

           Article    1146, Section     1, V.C.S.,   provides:

          “The board of aldermen   shall have power              to
     levy and collect an occupation tax of not more              than
     one-half of the amount levied by the State.”

            Section   6, H. B. No. 264, Ch. 67, page 86, 48th Legis-
lature,   provides:

           “Occupation Tax on Agencies         Sending Employees
     Out of State.    In addition to the license fee and bond
     required   in Section 3 of this Act, every employment
     or labor agent hiring, enticing, or soliciting        co-on
     or agricultural    workers   in this State to be employed
     beyond the limits of this State, shall pay an annual
     State tax of Six Hundred Dollars        ($600) and in each
     county where said employment          or labor agent oper-
     ates, an annual tax on a population basis according
     to the preceding     Federal  census as follows:      In coun-
     ties under one hundred thousand (100,000) population
     the sum of One Hundred Dollars          ($100); in counties
     having a population from one hundred thousand (lOO,-
     000) to two hundred thousand (200,000) inclusive,           the
     sum of Two Hundred Dollars         ($200); and in counties
     over two hundred thousand (200,000) population the
     sum of Three Hundred Dollars          ($300).    This tax
     shall be paid to the Commissioner          at the time such
     employment      or labor agency license or licenses are
     issued and shall be forwarded        by him to the proper
     tax collection agencies.      Such tax shall be good for
     the same period of time as the employment agency
     license.”

         House Bill No. 264 provides   in Section 3 that each li-
cense issued by the Commissioner     shall be good for a period of
one year from the date of issuance.
Hon. M. B. Morgan,       Page   3 (V-735)



          If this annual State tax of Six Hundred Dollars       is an oc-
cupation tax, then under the above-cited       constitutional  and statu-
tory provisions,   municipalities    have the authority to levy an oc-
cupation tax against such agencies in any amount not exceeding
Three Hundred Dollars      annually.    In our opinion this State tax is
clearly an occupation tax. The Legislature         so denominated it.
Such agencies at the time of the payment of this State tax are
required   to pay One Hundred Fifty Dollars       ($150) as a fee to se-
cure a license that is good for a period of one’year.         This fee is
charged for purposes     of administration    of the law and to regu-
late such business.    This State tax is levied clearly for revenue
purposes and placed in the General Fund.          The Court in Shed v.
State, 155 S.W. 524, approved the lower court in defining the word
“occupation? as follows:      “By occupation    ~ . . is meant a calling,
trade, or vocation which one engages in for the purpose of prof-
it, or making a living, or obtaining wealth.”        This tax is levied
and paid for the privilege    of engaging in the named occupation.

          The Court of Criminal  Appeals  held in Benson v. State,
44 S.W. 163 that an order of the Commissioners’    Court levying
an occupation tax on the occupations  taxable by statute was suf-
ficient, without specifying each and every occupation on which a
tax is levied.

             It is therefore our opinion that the ordinance         of the city
of Austin     which you quote is a valid enactment.

                                 SUMMARY

          A municipality  has the authority to levy an oc-
     cupation tax against employment      and labor agents
     who hire, entice, or solicit common or agricultural
     workers   in such municipality   to be employed beyond
     the limits of this State, in any amount not to exceed
     one-half of the tax levied by the State. Sec. 1, Art.
     VIII, Texas Constitution;   Art. 1146, V.C.S.

             An ordinance   of a municipality   reading   as fol-
     lows:

          “There shall be levied and assessed    against
     and collected from every person, firm, corpora-
     tion and association  of persons in the City of AUS-
     tin which is taxed by the occupation tax laws of the
     State of Texas, an occupation tax equal in each in-
     stance to one-half (i) of the occupation tax levied
Hon. M. B. Morgan,       Page   4 (V-735)



    by the State of Texas       on each occupation     or separate
    establishment,”

    is valid.   Benson    v. State, 44 S.W.    163.

                                            Yours     very truly

                                   ATTORNEYGENERALOFTEXAS




                                              W. V. Geppert
                                                Assistant
WVG/JCP


                                   APPROVED:




                                            ASSISTANT
