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Mr. Robert ,S. Calvert Opinion No. ~~-1280
Comptroller of Public Accounts
State of Texas Re: Whether tax refund may
Austin, Texas be made on special fuel
delivered by the user
thereof into the fuel
supply tank of a motor
vehicle, under the pro-
visions of Chap. 10 of
Title 122A, Taxatlon-
Dear Mr. Calverr;: tieneral.
You ask the opinion of this office relative to two questions
concerning refund of the State excise tax imposed on Special
Fuels by Chapter 10 of Title 122A, Taxation-General, V.C.S., and
which fuels have been delivered by the user Into the fuel supply
tank of a motor vehicle. Your questions are as follows:
“1. Does Article 10.14(3). . .preclude
payment of a tax refund on any part of a
delivery of special fuels into the fuel
supply tank of a motor vehicle for pro-
pulsion on the highway which is used to
operate stationary air condit~ioning units
installed on said vehicle? i
“2. If you should hold that payment of a
tax refund as described in Question 1, is not
precluded by law, then the Invoice required
by Article lO.14(2) to be Issued at the time
of appropriation for use and not thereafter
ard a copy filed as part of the claim, could
not be issued until after the fuel had been
used since the quantity used in such air
conditioners would be computed from the per-
hour use factor. In such case, could the
Comptroller accept, as consistent with the
law, an invoice issued at the end of the
day or other operating period showing the
total gallons appropriated and used in such
air conditioning units when such invoice is
filed as a part of the refund claim?”
. .
;:.:,,
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Mr. Robert S. Calvert, Page -2 Opinion No. ~~-1280
We answer your first question “Yes”. This answer precludes
our answering your second question.
The facts which have given rise to your questions are
stated by you as follows:
“The San Antonio Transit System, owned
and operated by the City of San Antonio,
has asked for an opinion as to whether or
not It can compute the tax on special fuels
used In Its bus air conditioning units for
tax refund purposes in which the fuel Is
not physically measured but is based on the
quantities shown to have been used each hour
of operation In tests made on each type and
model air conditioner used.
“The speclal,fuels purchased by the San
Antonio Transit System is predominantly
for delivery into the fuel supply tanks
of its vehicles for use on the highway.
Article 10.11 classifies such operation
as a non-bonded user required by Article
10.03(3) to pay the tax to its supplier
with the right granted by Article 10.14(l)
to claim tax refund on the fuel used for
any purposes other than propelling motor
vehicles on the highway (such as use in
’” ’ .“‘~‘a& conditioners).
“Its air conditioning units are operated
while the vehicles are being propelled over
the streets with fuel supplied from the same
fuel tank used to propel the motor vehicles.
The flow lines to the air conditioners are
not equipped with meters or other measuring
devices to measure the fuel used in such units.
“The San Antonio Transit System proposes to
account for the special fuels used in such
air conditioners on an hourly basis computed
as follows: some of the air conditioners
would be tested with measured special fuels
while operating. . . to determine the quan-
tity used per hour of operation. The hourly
quantity so determined would be multiplied by
the aggregate number of hours all of the air
conditioning units operated during the month
to establish the total gallons used and tax
. .
Mr. Robert S. Calvert, Page 3 Opknlon No. WW-1280
refund claims would be filed on the total
gallons shown."
In 1959, at Its Third Called Session, the ,56th Legislature
enacted the present "Special Fuels Tax Law" (sometimes herein-
after referred to as this Law). This Law is Chapter 10 of
House Bill No. 11; this House Bill constitutes Cha ter 1 of the
Acts of this Third Called Session, shown at page 1 1 7, et seq.,
of the Official Acts of the Called Sessions of the 56th Legis-
lature. Chapter 10 of this House Bill is codified by Vernon
as Chapter 10 of Title 122A, Taxation-General.
Article 10.14(3) of the Special Fuels Tax Law reada as
follows:
"(3) Any dealer or user who shall file
claim for refund of the tax on any special
fuel which has been delivered into the
fuel supply tank of a motor vehicle, or
who shall file any invoice in a claim for
tax refund upon which any date, figure,
signature or other material information
is false or Incorrect, shall forfeit his
right to the entire amount of the refund
claim filed." (Underscoring added.)
We believe that this Section (3) controls and prevails over all
other provisions of this Law relating to refund of taxes on
special fuels. Further, we believe all of the refund provisions
relating to special fuels must be strictly construed In that they
are in the nature of exemptions from taxation. City of Longview
v. Markham-McRee Memorial Hospital, 137 Tex. 178, 152 S W 2d
1112 (1941) State v. City of El Paso, 135 Tex. 359, 141 S.W.2d
366 (1940),'4-, Sec. 74. Very clearly
the Special Fuels Tax Law i& complete In every respect with
reference to the authorization for, and the manner of making
claim for and payment of refunds of the tax paid to the State
on all special fuels.
We observe that this Law makes distinction between:
One: Appropriation for use of special fuels (see
Sections (1) and (2) of Article 10.14).
Two: Use of special fuels, whether to propel motor
vehicles upon or off the public highways, or
for some other purpose (see Articles 10.14(l),
10.05(2) and 10.12(3)).
Mr. Robert S. Calvert, Page 4 Opinion No. ~11-1280
Three: Delivery into the fuel supply tanks of motor
vehicles. (see Articles 10.03(5), 10.13(k)
and 10.14(3)).
Article 10.03 of this Law, which levies the tax on special
fuels, In Section (5) states in part:
“Every user shall report and pay to this
Statethe tax, at the rate Imposed, on
each gallon of special fuels delivered
by him into the fuel supply tanks of
motor vehicles, unless said tax has been
paid to a licensed supplier. . . .‘I
We do not believe that the special provisions of Article 10.08
which authorize the Comptroller, in his discretion, to use a
mileage basis in determining the amount of tax due to be appll-
cable to the fact situation under consideration. Further, we
do not believe that you are authorized by Article 10.21 of the
Law to promulgate rules and regulations relating to the ellgl-
billty of special fuel for tax refund which would conflict with
the clear mandatory provisions of this Law which relate to
special fuel which has been delivered into the fuel tanks of
motor vehicles. (Articles 10.03(5), 10.13(Q) and 10.14(3),
hereinabove mentioned.)
.We recognize ;4hat Article 10.03(l) levies and imposes the
tax only upon the e . .use of special fuels for the propulsion
of motor vehicles upon the public highways of this State. . . .”
However, with reference to refund of the tax paid upon special
fuels which have been delivered by the user into the fuel supply
tanks of motor vehicles, we believe that Section (5) of this
same Art. 10.03, construed together with Articles 10.13(b) and
10.14(3) make clear that all such fuels have been used for a
taxable purpose.
SUMMARY ‘,
Special fuels delivered by the user
thereof into the fuel supply tank of a
motor vehicle are not subject to refund
of the excise tax paid on that fuel under
. 1
Mr. Robert S. Caluert, Page 5 Opinion No. ~~-1280
the provisions of Article 10.03, Title
122A, Taxation-General, V.C.S.
Yours very truly,
WILL WILSON
Attorney General of Texas
Assistant
WEA/rk
APPRCVED:
OPINION COMMITTEE:
W. V. Geppert, Chairman
Arthur Sandlin
Henry Braswell
Virgil Pulliam
John Reeves
REXIEW FOR TRE ATTORNEYGENERAL
By: Houghton Brownlee, Jr.