Honorable Bob Bullock Opinion No. JM-566
Comtitrollerof Public Account:s
L.B.J. State Office Buildin!: Be: Whether interest earned on
Austin, Texas 70774 the bingo tax, the bank franchise
tax, and the mixed beverage tax
collected by the state should be
remitted to the local jurisdiction
for which the taxes were collected
Dear Mr. Bullock:
In Attorney General Clpinion .JM-539 (19861, we concluded that
local taxing units are entitled to be credited with interest earned by
the deposit of tax monies ,:ollectedby the state on behalf of those
local taxing units pursuant to the Local Sales and Use Tax Act,
article 1066~. V.T.C.S.. and articles 1118x and 1118~. V.T.C.S., which
authorize the creation of cwtropolitan rapid transit authorities and
regional transportation awhorities, respectively. We so concluded
because they constituted trust funds. You now wish to know whether
interest earned by the depo:;itof tax monies collected pursuant to the
bingo tax, the bank franchl,setax, and the mixed beverage tax should
be similarly treated. We answer your question in the negative. We
conclude that interest earned from the deposit of those taxes should
be deposited in the general revenue fund.
The Bingo Enabling Act was passed pursuant to article III,
section 47. of the Texas {Constitutionand is set forth in article
179d. V.T.C.S. Section 3 OE the act authorizes a commissioners court
of a county that has voted to legalize bingo or in which a justice
precinct has voted to leg;llJze bingo and the governing body of a
municipality that has voted to legalize bingo to impose a two percent
gross receipts tax on the conduct of bingo games. Section 24 provides
that "[tlhe comptroller of public accounts shall perform all functions
incident to the administrat:.on
, collection, enforcement, and operation
of any tax imposed under this Act." Section 25 declares that "[a]
license required to file a tax return shall deliver the monthly return
with a remittance of the nc!t amount of the tax due to the office of
the comptroller of public accounts." Section 26(a) provides the
following:
p. 2514
Honorable Bob Bullock - Page 2 (JM-566)
Sec. 26. (a) Each jurisdiction's share of all
gross receipts tacos collected under this Act by
the comptroller of public accounts shall be trans-
mitted to the treasurer or the officer of the
jurisdiction performing the functions of that
office by the comptroller of public accounts pay-
able to the jurisdiction periodically as promptly
as feasible. Trar.smittalsrequired under this Act
shall be made at least twice in each state fiscal
year. The funds EO transmitted may be used by the
jurisdiction for r.ny purpose for which the general
funds of the jurit,dictionmay be used.
Section 171.001 of the Tax Code imposes a franchise tax "on each
corporation that does business in this state or that is chartered or
authorized to do business in this state." Section 171.078 of the Tax
Code, which specifically exempted banking corporations from the
franchise tax, was repealed tsyActs 1984, 68th Leg..,2nd C.S., ch. 31,
art. 3, part B, §I, at 212. Article 3, part B, section 1. of the 1984
repealing act provides in pmt:
It is the intention of the legislature that by
repealing this section, which provides an exemp-
tion for state and federal banking corporations,
all banking corporations in this stats become
subject to and p,sy the franchise tax imposed by
Chapter 171, TaK Code, as provided by this
article.
Section 171.1031 of the Tax Code defines "gross receipts" of a banking
corporation as "interest and dividends received . . . from its
business done in this statUntitled Texas Attorney General Opinion
Combined Opinion