Opinion No. ( 1987 )

Mr. Bobby Tullis State Representative Box 277 Mineral Springs, AR 71851

Dear Representative Tullis:

This is in response to your opinion request wherein you posed the following question:

Is it lawful for a county quorum court to levy a county franchise tax on utilities operating within the county; and, if so, is there any limit as to the amount of the franchise tax which may be levied by the county?

The answer to your question is that counties in Arkansas are without the power to levy a county franchise tax against public utilities. A franchise is a privilege of a public nature which cannot be legally exercised without legislative authority. State v. Real Estate Bank, 5 Ark. 595, 599 (1844).

Ark. Stat. Ann. 84-1501 et seq. provides for the privileges subject to taxation for county purposes. Franchises, being privileges, have not been subject to taxation under the law. Since the county can only levy taxes that are authorized by the General Assembly, Vance v. Little Rock, 30 Ark. 435 (1875), then the county is without authority to levy a franchise tax.

This opinion, which I hereby approve, was prepared by Assistant Attorney General Paul L. Cherry.