                      Aws-   11. TEXAS



                    December 19, 1962


Mr. Robert S. Calvert              Opinion No. ~~-1502
Comptroller of Public Accounts
Austin, Texas                      Re:   Whether motor fuel
                                         purchased for use
                                         of the Texas National
                                         Guard Is subject to
                                         the State excise tax
                                         Imposed by Ch. 9,
                                         Title 122A, Taxatlon-
                                         Qeneral, Revised Civil
Dear Mr. Calvert:                        Statutes.
        You ask whether sales of motor fuel to the Texas
National Guard are exempt from the Texas motor fuel excise
tax imposed by Chapter 9 of Title 122A, Taxation-General,
Revised Civil Statutes of Texas.
        Our answer is that all motor fuel purchased by the
United States Property and Fiscal Officer and used by the
Texas National Guard Is exempt, but that all such fuel pur-
chased for use of the Guard while It is on active State duty
under command of the Covernor of Texas Is subject to this tax.



        A letter to this office from Col. Carl F. Schupp II,
the United States Property and Fiscal Officer for Texas, gives
the following information relative to the three separate statuses
of the Guard and the purchase of motor fuel for each.
        CoL Schupp states that the Guard may have the status
for any particular duration of time of being on (1) Federal
active duty'at which time it is on the active list of the U. S.
Army, or (2) inactive Federal status, or (3) active State duty
upon call-up by the Governor of Texas.
        He states, also, with reference to purchase of motor
fuel for the Guard, that:
        1) while the Guard Is on active Federal duty all gaso-
line It uses Is furnished by the U. S. Department of Defense.
Mr. Robert S. Calvert, Page 2 (Opinion No. ww-1502)


        2) while the Guard Is on inactive Federal status, all
      ^__
motor sue1 sor it Is purchased by the U. S. Property and Fls-
cal Officer of Texas for the exclusive use of the Guard and
paid for by funds furnished by Congress for operation and
maintenance of its Army National Guard. This motor fuel is
delivered into the exclusive possession of the U. S. Property
and Fiscal Officer who is a commissioned officer on the active
list of the United States Army detailed to,the National Guard
Bureau. All petroleum products purchased by this office are
paid for by the Finance and Accounting Officer, Fort Sam,
Houston, Texas. Procurements are made on Federal contract
form and/or purchase orders for the Texas National Guard,
both Army and Air. This gasoline is delivered in kind to the
various using units of the Guard for their exclusive use under
U. S. Army regulations.
        3) while the Guard Is on active State duty, the motor
fuel purchased for and used by It is purchased by the State of
Texas with State funds.
All vehicles which use motor fuel are owned by the United States.

                             2.
        The case of McCulloch v. Maryland, 4 Wheaton 316 (1819),
established the principle that no state .may tax any function or
property of the United States. The Constitution of the United
States, Art. 1, Sec. 7, grants to Ctngress the exclusive power
"To raise and support Armies,          The Army of the United
States is composed'ln part of ;'.'.'.'theArmy National Guard
while In the service of the United States, . .     L The "Army
National Guard"2 Is composed in part of the Texas'Natlonal
Guard.
        The motor fuel tax law,(Ch. 9, Title 122A, V.C.S.)
expressly provides that motor fuel sold to the Federal Govern-
ment for the exclusive use of the Federa Government may be
sold tax-free.3 Further, these statutes1:provide for a refund



1 lo u.S.C.A. sec. 3062 (70 A. Stat. 166).
2 32 U.S.C.A. Sec. 101 (72 Stat. 1542).
3 Article 9.05 (1) and (3), V.C.S.
4 Article 9.13 (8), V.C.S.
Mr. Robert S. Calvert, Page 3 (Opinion No. WW-1502)


of this tax upon all motor fuel sold to the United States
Government for the exclusive use of the Government. These
statutes5 require specific reports covering motor fuel sold
to the United States Government.


                           3.
        We now consider the reasons for our holding that motor
fuel used by the Guard when It Is on active State duty under
command of the Governor of Texas is subject to this tax.
        We know of no constitutional prohibition against the
Legislature levying an excise tax to be paid by the State and
its agencies. The law is settled that our State Constitution
           9,    , is in no manner a grant of power.
           It operates solely as a limitation of
           power. All power which is not limited
           by the Constitution Inheres In the people,
           and an act of a state legislature Is lenal
           when the Constitution co%alns no prohi-
           bition against it." Watts v. Mann, 187
           S.W.2d 917, 923 (Civ.App. 1945, error
           ref.)
See also State v. Wynne, 134 Tex. 455, 133 S.W.2d 951, 958
(1939); 40 Tex.Jur. 20 -21, Taxation, Sec. 8.
        The tax under consideration Is an excise tax. State
v. City of El Paso, 135 Tex. 359, 143 S.W.2d 366, 369 (m.
        We recognize the well-established general principle
that usually the Legislature does not intend to tax property
of the State. This principle is stated In Lower Colorado
River Authority v. Chemical Rank & Trust Company, 144 Tex.
                               City of Marlin v. State, 205
                                  However, we distinguish
                              upon the fact that these
authorities apply this principle to ad valorem taxes and
not to excise taxes. Further, In the absence of express
constitutional prohibition against such an excise tax as
the one under consideration, this general principle is one
of statutory construction only. Cooley on Taxation (4th.




5 Articles 9.03 (1) and 9.05 (3), V.C.S.
Mr. Robert S. Calvert, Page 4 (Opinion No. WW-1502)


Ed. 1924), Vol. 1, p. 217, Sec. 91 and Vol. 2, pp. 1312-1317,
Sec. 621; Eagle.Polnt Irr. Dlst. v. Cowden, 1 P.2d 605 (Ore.
Sup. 1931). Several distinctions between an ad valorem tax
and an excise tax are stated in State v. Wynne (supra at p. 956).
        The very broad and specific provisions of the motor
fuel tax statutes (Ch. 9, Title 122A, V.C.S.) make clear that
the Legislature did not intend to exempt from this tax the motor
fuel purchased by the State for the Texas National Guard. We
mention several provisions of these statutes which make-this
Intent clear:

        1) The statutes are general In the&r appll-
             cation and the Legislature certainly knew
             at the time of passage of these statutes
             and of their amendments that the State
             purchased and consumed large quantities
             of motor fuel in,motor vehicles operated
             by It.

        2)   Article 9.02 (1) imposes the tax '. . .
             upon the first sale, distribution, or
             use of motor fuel in this State . . .'
             without any exceptions.

        3) While motor fuel and certain other
           petroleum derivatives may be sold tax-
           free to the Federal Government under the
           provisions of Article 9'.05,subd. (1)
           and (3), and while the tax paid upon
           motor fuel sold to the United States
           Government for the exclusive use of
           said Government is expressly sub ect
           to tax refund under Art. 9.13 (83 , yet
           in none of these statutory provisions
           which make specific reference to the
           Federal and United States Government
           is the State mentioned; nor may the
           State be'implied from the wording of
           any of these provisions.

        4) The State Is not mentioned in Article
           9.03 (1) wherein the United States Govern-
           ment Is specifically mentioned.

        5) The State Is neither mentioned nor implied
           in Article 9.02 (4) which makes certain
           specific exemptions from this tax.
 .




Mr. Robert S. Calvert, Page 5 (Opinion No. ~~-1502)


        6 ) The provisions for refund of the tax con-
            tained In Article 9.13, subd. (2), (4),
            (6), (7) and (8) are both specific and
            comprehensive and make no provision for
            refund of the tax on motor fuel pur-
            chased by or for the State of Texas.
        Art. 9.02 (1) levies the tax upon the purchaser ore
recipient of the first sale of motor fuel in the following
language:
          "There shall be and is hereby levied and
          imposed (except as hereinafter provided)
          upon the first sale, distribution, or use
          of motor fuel,in this State an excise tax
          of five cents (5#) per gallon or fractional
          part thereof so sold, distributed, or used
          In this State. Every distributor who makes
          a first sale or distribution of motor fuel
          in this State For any purpose whatsoever
          shall, at the time of such sale or dlstri-
          butlon, collect the said tax from the pur-
          chaser or recipient of said motor fuel, in
          addition to his selling price . . .'
          (emphasis added).
This statute levies the tax upon every "purchaser or recipient",
and not upon only a "person" as defined in Art. 9.01 (6) of the
motor fuel act. The definition of "first sale" in Art. 9.01
(10) is not restricted to any particular kind of "purchaser or
recipient".
        Also, you inform us that your departmental construction
since 1941 has been that motor fuel ourchased by the State and
used by-the Guard is subject to this-tax, and we feel that your
departmental construction is entitled to great weight
   Lyles, 142 Tex. 704, 181 S.W.2d 570, 573 (1944). Pay-
zhe tax by the State and Its agencies since 1941 Is a matter of
financial-concern which, 'we have no doubt, has been well known
to the several Legislatures which have convened since that
date. The acauiesence in this statutorv construction should
be given great weight.
s.w.2d 322, 328-329 (civ
Butler, 142 Tex. 692, 1.8
        Our holding that the State must pay to itself this tax
is distinguished from the holdings in Attorney Generals' Opinions
Numbers o-6791 (1945) and WW-721 (1959). The first of these
opinions held that the State was not liable for ad valorem taxes
                                                                   1..




Mr. Robert S. Calvert, Page 6 (Cpinlon No. WW-1502)


on lands owned by the Texas Prison System; the second held
that the State was not liable for certain excise taxes on
items purchased for Its use by the Board of Control. Roth
opinions were based upon the ground that no appropriation had
been made by the Legislature to cover such taxes. The last
general appropriation to the Adjutant General's Department
for the Texas National Guard6 is broad enough to cover pay-
ment of the State excise tax on motor fuel purchased by the
State for use by the Texas National Guard.




b Acts 1961, 57th Leg., lst.C.S., Ch. 62, p. 203.



                            SUMMARY
         1.   Motor fuel furnished by the 'U. S. Lkpart-
              ment of Defense and that purchased by the
              U. S. Property and Fiscal Officer for use
              of the Texas National Guard while the Guard
              is on active and Inactive Federal status Is
              exempt from payment of the motor fuel excise
              tax imposed by Ch. 9 of Title 122A, Taxatlon-
              General, Revised Civil Statutes.
         2.   Motor fuel purchased by the State of Texas
              for use of the Guard while It is on active
              State duty under Command of the Governor
              of Texas Is subject to this motor fuel
              tax.
                              Very truly yours,
                              WILL WILSON
                              Attorney General of Texas



                              By'     W/4 &eti
                                      Assistant Attorney General
WEA:pw
.   ,-




         Mr. Robert S. Calvert, Page 7 (Opinion No. WW-1502)


         APPROVED:
         OPINION COMMITTEE
         W. V. Geppert, Chairman
         Joseph Trimble
         Grundy Wllllams
         W. 0. Shultz
         L. P. Lollar
         RhVI.EWEDFOR THE ATTORNEY GENERAL
         By: Leonard Passmore
