Untitled Texas Attorney General Opinion ( 1956 )

THE Amro~m~ GENERAL OF EIKAS AnTI-IN 11.TEXAS dOEIN BEN SJZICPPEHID [ ~~~~~;~~k& 1 dT¶vsRlNEI “PtNrnRAI- August 28, 1956 -tb-A-@@+f%AL Honorable Robert 9. Calved Opinion No. S-214 Comptroller of Public Accounts Capitol Station Re: Application of State Prize Austin, Texas and Award Tax under Article 70471, V.C.S., to awards Dear Mr. Calvert: under certain circumstances. You request our opinion as to whether a State Prize and Award Tax accrues on awards given under the following circum- stances: "1 . To win the TV set or trip, bring the car You are driving, regardless of make, to Don McMilllan, Inc. for an appraisal during this Want 6 Day Event. Some lucky appraisal ~111 be drawn and will be the winner. "2 . To win the 1956 FORD, every buyer who purchases a 1956 FORD CAR OR TRUCK from Don McMllllan, Inc. during the 6 days may complete the statement "I bought my 1956 FORD from DON MCMILLIAN, INC. because . . . in 25,,wordsor.less. .The best statement judged by an independentboard of judges will win the 1956 FORD they bought for the person who writes It." Article 7047f(a), Vernon's Civil Statutes, provides: 'Every person, firm, or corporation conducting a theatre, place of amusement, or any buslness enter- prise in connection with the operation of which a prize In the form of money or something of value is offered or given to one or more patrons of such theatre, place of amusement, or business enterprise, and not given to all patrons thereof paying the same charge for any certain service, commodity, or entertainment, shall make a verified monthly report on the twenty-fifth day of each month to the Comptroller of Public Accounts of the State of Texas, showing the amount of money so given in prizes, and the value of all prizes or awards so given in connection with such business during the next preceding month." Honorable Robert 5. Calvert, page 2 (Opinion No. S-214) Article 7047f(b) levies a tax of twenty per cent of the value of such prizes. Since no "chargd'is required of the participants in the first above mentioned situation, we do not believe the tax is applicable to the award mentIoned therein. However, as to the second above named situation, the re- quirement of the purchase of an automobile or truck constitu- tes a charge. The fact of a variance in the purchase prices of the various types of automobiles and trucks sold would not of itself remove the transaction from the application of the statute, as long as such variance has no relation to a chance for the award. Neither would the requirement of submission by all contestants of statements of 25 words or less of the reason for the purchase of the vehicle remove the transaction from the statute. Therefore the tax Is applicable to the second named situation. Prior Attorney General's Opinions In conflict herewith, including Opinions Numbered 0-378 and O-662, are hereby over- ruled to the extent of such conflict. SUMMARY Article 7047f, V.C.S., does not levy a Prize and award tax unless a charge is paid by the persons oarticipating in the chance for the award. A prize awarded to the purchaser of a car who submits the reason eelected as best for the purchase of the car is subject to the tax where all participants are re- quired to purchase a car and submit a statement of reason for the purchase. Yours very truly, APPROVED: JORRBEN SHEPPRRD Attorney General Will D. Davis Reviewer J. Arthur Sandlin BY Reviewer As L. N. Gray Special Reviewer Davis Grant First AssIstant John Ben Shepperd Attorney General