           THE      ATTORNEYGENERAL
                          ow    TEXAS



                        February 17, 1960

Honorable Robert S. Calvert                Opinion No. VW-801
Comptroller of Public Accounts
Capitol Station                            Re:     What aales or use tax,
Austin, Texas                                      if any, is levied where
                                                   a motor vehicle manu-
                                                   facturer  leases vehicles
                                                   which it has produced to
                                                   its own employees within
                                                   this State, without options
Dear Mr. Calvert:                                  to purchase?
        Your letter requesting     our opinion       upon the above question
reads    in part as follows:
               “Ford Motor Company as requested informa-
            tion regarding their tax status In the State
            of Texas under the following     circumstances.
            Ford Motor Company, an automobile manufacturer,
            Is contemplating     leasing automobiles of their
            own manufacture to certain company employees.
            The company, located outside the State of Texas,                ,,
            would lease and register     the vehicle,   stand
            responsible    for its mainttnance and repair,
            in return for a stipulated     monthly rental paid
            directly    to the company by the lessee-employee
            located in the Stat2 of Texas.       The lease would
            not contain an option to purchase.
              “Question:       What tax,   if any, should the tax
            assessor-collector      levy   on a vehicle owned by
            a vehicle manufacturer   and leased to a company
            employee to be used in the State of Texas,
            with no option  to sell?   Who would be liable .
            for the tax?   Where should it be paid?”

        It Is our conclusion     that   no sales     or zse   tax   is   due upon
such    a transaction.

        Chapter 6   Title    122A-Taxation-General       (H.B. 11, 56th
Leg.,   3rd C.S.1   provides     for  retail   sales  and  use taxes upon
motor vehicles.      Article     6.01 levies    a tax u on every retail
sale (as defined     in Article      6.05 (1) and (2), ‘i of a motor vehicle
in this State.      Article    6.03 levies     a use tax upon every motor
vehicle   purchased    at retail     sale olltside   the State and bra-ught
Honorable   Robert S. Calvtrt,    Page 2       Opinion No. m-801


into the State for use by a resident or by a person, firm, or
corporation    domiciled or doing business in the State.    Neither
of these Articles     apply in the present situation because no
retail   sale, tither within or without the State, has occurred.
See Attorney General’s Opinions Nos. O-3583 and V-1044.
      Article    6.04 levies a “New Resident Use Tax” upon any
person making application        for the initial   certificate  of title
to a vehicle     In this State.      While no sale Is required for this
Article to operate,       still the Legislature    has clearly  expressed
its intent as to the scope of the provision          by the closing
sentence,    which reads : “It Is the purpose of this Subsection
to impose a use tax upon motor vehicles          brought into this State
by Sew residents      of? this State."    Neither the lessor nor the
lessee in the present case are new residents           of the State;
therefore,    this Article     is likewise inapplicable.
     Our conclusion makes it unnecessary          to consider   the second
and third parts of your question.
      This opinion is, of courst,    limited to the specific   fact
situation  presented;  that is, tht bona fide leasing of stlf-
produced vehiclts   by a manufacturer to Its own employees within
the Statt, the employees having no option to purchase and title
remaining In the manufacturer.      Any departure from these facts
might product a dlffertnt   rtsult.     Set Attornty General’s Opinion
No. WW-711.
                        SUMMARY

           Where a manufacturer of motor vehicles
      leases vehicles  which It has productd to its own
      employees wlthln this State, rttainlng   title,
      with no option to purchast in the lessees,      then
      no retail  salts or use tax is due upon such
      leasing under Chapter 6, Titlt 122A-Taxatlon-
      General, R.C.S.
                                 Your8 very   truly,
                                 WILL WILSON
APPROVED:                        Attorney, General of Texas
OPINION COMMITTEE:
W. V. Geppert, Chairman
W. R. Scruggs
B. H. Tlmmlns, Jr.
Linward Shivtrs
Martin DtSttfano                 JRI:cm
REVIEWEDFOR THR ATTORRRY
                       GXWERAL
By: <Leonard Passmore
