Untitled Texas Attorney General Opinion

Hon. John Ben Shepperd Opinion No. v-1264. Seoretary of State Capitol Station Re: Several questions relat- Austin, Texas lng to collecting addi- tional franchise taxes imposed by House Bill 285, Acts 52nd Leg.,, 1951, ch. Dear sir: 402, p. 695. Tour request for an opinion Is in part as fol- lows: w’upon making a study of the provisions of H.B. 285 enacted by the 52nd Legislature, particularly the franchise tax section, cer- tain questions have arisen as to the inter- pretation and administration thereof. ”. . . “In accordance with the provisions of the resently effective Articles 7084 and 7084, this office has collected from corpo- rations presently in good standing the fran- chise tax at the ‘normal’ rate of $1.00 per $l 000 of taxable capital, minimum 0.00, ana at the supplemental (Article 70 f e) rate of an additional l/3 of 10% of all franchise taxes levied by and due and payable under said Article 7084. . “We respectfully ask that you $ve us your opinion in answering the follm!ing que s- tlons: “1. Do the provisions of H.B. 285 as quoted above require the collection of any additional franchise tax before May 1, 19521 If so would it cover the entire ie- riod %m May 1: 1951 to /Lpril 30, 1952; or ’ ‘* Hon. John Ben Shepperd, Page 2 (V-1264) would It cover only the period from Septem- ber 1, 1951 to April 30, 1952 in the same proportion as that period bears to a full year? ‘!3ti At what rate is the additional tax, If any, to be computed and a.) when ‘is it due? b) when is it payable? (c) may collection be made during the regular tax aollectlon period on or before May 1, 19521 Would the 25% penalty as provlded in Ar&e 7091 be applicable to the addl- tional tax, if any,‘and If so, after what date would the penalty apple “5., Assuming that a corporation is sub- ject to the minimum tax, and has already paid $20.67 (the minimum under Article 7064 and Article 708%) for the period May 1,~ 1951 to April 30 1952, what additional amount, If any would ge due under the minimum tax pro- visfon of H.B. 2851’1 Attorney General’s Opinion V-1248, addressed to Hon. John Ben Shepperd, Secretary of State, dated August 21, 1951, held In part as follows: “In Opinion V-1246, dated August 2l 195l addressed to Hon. Robert 5. Calve$, campt roller of Public Accounts, this office held that House Bill 285 became effective from and after September 1, 195l., and all taxes of whatever kind or nature included therein should be levied and collected at the rates therein prescribed without re- gard to whether such tax was levied on an annual quarterly, or monthly basis- Hence, House Bill 285 imposes an additional fran- chise tax at the rate of 25# upon all corpo- rations for the privilege of doing business in Texas in corporate form for the period commencing September 1, 1951, through May 1, 1952.” : l Hon. John Ben Shepperd, Page 3 (V-1264) Section IX of-,&use Bill 285 imposes and re- quires r;he coiiection ci$ an additional franchise tax at the rate of 25+! per thousand dollars from all corpo- period from September ich tax becomes due on date of House Bill 285. ., 167 s.w.2a 557 (Tex. Since the Act falls to provide any specific date for the payment of the additional tax, it neoessar- lly follows that the tax Is payable on and after Septem- ber 1, 1951, and collection thereof may be made during the regular tax collection period on or before May 1, 1952. We believe the foregoing answers your questions Nos. 1, 2, and 3. The Legislature did not speolflcally provide that a penalty would attach by reason of the failure of the taxpayer to pay the additional tax when due, and the 25% penalty provided in Article 7091, V.C.S., which is applicable only for the failure to pay the annual fran- chise tax due and payable in advance QII or before Mav ;L f each tax&&e VW would not attach by reason of then iailure of the taxpa;er to pay the additional tax im- posed by House Bill 285 on or after September 1, 1951. However, Article 7092, V;C.S., provides that the Secretary of State, during the month of May of each year, shall notify any domestic or foreign corporation subject to the payment of the franchise tax which has failed to pay a franchise tax on or before the 1st day of Map, that unless such m tax is paid on or be- fore the 1st day of July next following, the corpora- tion’s right to do business in this State will be for- feited as provided therein. Therefore, any corporation, domestic or foreign, which fails to pay the additional tax imposed by House Bill 285 on or before May 1, 1952, is subject to have its right to do business forfeited under the provisions of Article 7092, V.C.S. In answer to question No. 5, a corporation sub- ect to the minimum tax ~which has alread paid 9520.67 i the minimum under Artfkles 7084 and 708rr, V.C.S.)is subject to the payment of an additional m&mum tax u11- der the provisions of Section IX House Bill 285, for the period September 1, 199 to April 30, 1952, both inclu- sive, which is two-thirds of one year. The amount of such Hon. John Ben Sheppira, Page 4 (V-1264) additional minimum tax would therefore be computed on the basis of two-thirds of the additional tax of $5.00, or $3.33. Section IX, H.B. 285, Acts 52nd Leg., 1951, ch. 402, p. 695, requires collection of an additional franchise tax at the rate of 25# per thousand dollars upon all corporations privileged to do business In Texas in corpor- ate form for the period commencing September 1, 1951, through May 1, 1952. The, additional tax is due September 1, 195‘1, is payable on and after September 1, 195l, and may be collected during the regular tax collection period on or before May 1, 1952, without being subject to the penalty provided In Article 7091 V.C.S. The penalty provisions of Article 7041, V.C.S. do not apply to the additional tax for this pe- riod. Corporations subject to the payment of an additional minimum tax are subject to the payment of an addlt lonal minimum tax for the same period in the sum of $3.33. Yours very truly, APPROVED: PRICE DANIEL Attorney General Jesse P. Luton, Jr. Reviewing Assistant ~{q;~~,(&.&.& Everett Hutchinson. BY Sxecutlve Assistant C. K. Richards Assistant Price Daniel Attorney General CKR:wb