OFFtCE OF THE AtTORNEY GENERAL OF TEXAS
AUSTIN
Honorable Ceorg4 H. Shqqard
Comptroller of Public Aooounts
Austin, Texas
Deer Sir:
aJ JOtArletkr 1959, ~appLaa4nt-
ed b;lyour8 of k ii the TituiJCoun-
ty Balr and ml state for the prim
or lwa r U ta x te o r no n~8 Anno ta ted
&%bairy Shor is held
11, and runs ror s day8
QS9 fair wataSapt 16th
no. For lQSS, date0
h. Uo doubt the bates
e @ornowherearound thorn datots.
ion fee or 10 wita r0r ohlltlren
or adult4 ar4 ahargsd, exoept 01)
mhloh is usually on Twmsdap they
On Weduesday of the fair,
oye ana girls are admitted irem, wh%oh
inoludes 4ZiClub boys and girls and VoOatieaal
boys.
"~04, thme is a oarnlval playfug on tha
grounda, a8 it wouldnt be a fair if you ditln*t
have that in 44nm4tion, ride8 ror the ohlldren
and thq youngm orowd and aide showa and oon-
oeeslone that uruellp go with the oarniral, and
I.46
Honorable George H. Sheppard, Fat?* Z
for that privilege they give the Fair Asen 155
or the grow3 on show8 and rides.
"This paet 1939 Fair, the Sohool children
0r the County had a programma In wont or the
grand atand whloh wae~free to all that wished
to Bee it, this waason Tuerday Night; On wed-
nesday Might there was a double pub110 wedding
put on by the 10081 paople of the town, whioh
warnalso free; On Thumday &ight in front of
the grand stand war e programma of band 4111414,
by ZLt.Pleasant High School Emnd and Oilmer
IiighSohool Band, this was alao free; On Friday
Bight and on Saturday Eight the two automobiles
were given away, free. There MII no horae raoer,
saddle ahow, or danae in oonneotlon with the fair
where a eeparato admisrion oharged. The only
ahargo made to enter the rair ground6 wallthe
above 10 eta aad 8% 4t8, and you were privilege
to do a8 you please, 8eo the agrioultrrral 0x0
hlbita, wonmn*s exhlbitr, hop oluba exhibit8
the cattle exhibits and horserrand mule exhibit&,
and the above that I have outllnad, without any
further oharge or expanne.
*The premlama listed in the Fair Gatalogue
a&m&ted to $1,640,00 and hl.1taken ior 19S9 iOr
the various lxhlbitora. The gate admiselon Too
and the carnival o6noemrlons ie~where the Sair
Aoaociation 8eoure8 the money to get the $1,000
offarad in premium8 and to pay the insurance on
the bulldlags, to pay for labor and help in put-
ting a rair on, and to make adtlitionallmprove-
manta ae are nredod rroffi t&ma to time ror laoh
annual talr . wo salaries am pai& to any 0rri-
olsli so dividends are paid to stockholdera, but
any earnings made over end above the expense of
putting on a fair, if any, gose ba4k into the
plant In addit%4nal premiums and new improvements
r0r the nsxt year's tab.
"The Soye Soout have their hut on the iair
grounderwhioh they use free of cost; The Axiterloan
Legion have thair building on the Brais groundr,
where they have their meetinga.,tree of ooati The
Rome Demonstration women of the Oounty have their
building on the ground uee free of oorrtto them;
iionareble04org4 H. Shepgw4, mite 8
Th4 Xount~Pl4asant
_ - _have th?lr-
- -. Ba?eball-Club
granastana ana axsm4na on tne ram gxtouaasrmo
0r oost to th4m, aa th4 gmwa6 are Open t0
any other public 4nterprlse or organlssitionof
a public nature. U44tlngs o? a pub110 nature
are held qul4t 0?ten at thr Fair Park, ?re4.*
For th4 purpoaee or oomputlng tax liabllitl48,
Artiole 7047r-(a), V4rnon's Annotat4a Civl& Statut48, pro-
vi408 a8 r0110rrst
*(aI Xver~ wreon. rim. or oormmtlon
oi something o? valu4~16 off4rra or glv4n to
one or m0re patrons o? eaoh th4atr4, plaa4 0r
amus4mnt, or businree enterprise, and not ginn
to nil patron8 therw? palingthe mm4 oharge
for any oertaln 64rvio4, 00erPoalty,or mater-
talnm4nt, shall s&6 a vrriried monthly lvport
on th4 twentp?iith dam of eaoh aontb to the
Oamptrolletior Publio Aooeaate of the,StaC;eo?
Texas, shoring th4 amount O? m0n4y 60 giv4n in
priue, and t&a value of all prlsee or awards
so given in o6nneotl6n with suoh btulnesrs dux-
ing th4 next pzuoeding mnth.~
Art1014 7047?-(b), Vernoa~e AmeUteQ Q&vi1 Btat-
ut46, levies t&e ?oLlting tax:
a(b) Ther4 $6 hereby 14~248 8 tax aQUa te
twenty per 04nt (80%) of the value o?.&ll luoh
0on4J, prbes, and awards giv4n In 0onneOtlen
wlth the operation a? eaoh land all of *he ion-
oln business en~rprf648,and at the~tlme~
nor kg the report to tb f%mptroUmr 0r mbllo
~gEp
Ao44unt6, th6 owned-or &eXWiW of any suah
business shell pay to the State Tmaeurm auoh
tax upon the total amount 0r money, pr14~88,and
awards so given during the next prooedhg aonth.
. . ..”
st is maniieat that the inol44noe O? this tax
14~7is lid46 to pro24401~awards 0rr4ma er glv4n in
oeoneotlon with thi oppatlon or *a theatre, plaai or am&-
emt, or any bueinese entergrl84= and does nOt r4aoh giving
1.48 -
Eonorable George E. Sheppard, PSg4 4
0r prises or award6 under any other 4onditione or in eon-
neotion with any other project8 or eituation8. tiehav4 her4
then no general prize or award tax levied upon the giving
of prize4 or awards, a4 such, but only 4 restriOted tax or
twenty psr cant (i!t$)o? the value o? money pcice6 or awards
given in conneotlon wltt the operation of “‘a theStr4, ~140s
or amuesment, or any business enterprise.* It r0n0w6 then,
tbet ir the Titus County Fair and Dairy show does not tall
within the above claeSlrloation, the twenty per cent (&O$)
price or award tax upon the ~41~4 or the-automobile given
away in oonneotion with auah fair does not aoorue.
It 1s our conoluslon that the Titus County Fair
end Dairy Show, organized and oouduoted as outlined in the
r0r0g0ing raotual statement, tuxlcounty rafra as gen4rally
organized and conduoted, oannot be phoed within the statu-
tory olaeeirloation o? *a thoatre, plaoe of amueeaent, or
any bueinese enterprise* without defeating the fnt4nt and
purpos4 or the Lagielature, gathered troa the entire A4t.
fn u8i.ngthe term Wthsatrem or Wplaoe of aQAu8ement"the
ImgiSlStur4 or Texas aid not purposa to oreate Snather end
alrrment olaasirlostlon or eubjeots.ror taxatlan, but merely
to single out two type8 or 8peele6 of the all-•mbrSolng
genus or olae8iiloatlon or wbu8in4s6 dlnterprise.* The reason
ror this-aotlon r4fkailyappear6 rhan~we,ex6&Ae. 3h4 legie&tiv4
hlatory 0r this tax measure ana the aJ.leged~erilSsought to
be rsaohed by this admittedly eshorbltan$tat. At and berore
the p486Sg4 'Ofthin statute the *JkUlkRight" +Mil of aWal.6
ing prlr+es to the patron8 0r theatres and,mobn pioture
hoU8eS was~in ruli ilower, not having yet been, 8trSeken a0*m
by our Supreme Court. Out 0: abundant Oautlon;‘~~ieot perohm
this method or prize-giving should esoape the onus of this
tax, the Leglelature advleedlp used the t4rm4 %heatre* and
wpkice 0r simuSsment,*in Saaltl0n to the general 4]aSSifiOS-
tion of "any buaineee 8nterpriee.a, But we aubmlt that if
such ~th4etreW or"plaoe or amueementW fa not aonduoted 44 4
Wbu4ine4e eoterpriee,n prizes given in oonneotlon therewith
are not taxable.
WO are assletea in reaching thla oonoluelon by a glanas
at other parts 0r this i&t. A reiarence to the caption of
the so-oalled ormlbua Bill refers to the tax involved here
as a tax on prizes given in oonneotlon with Ybueine4e enter-
prieea .* Moreover, SubalvlSlon (b) or Artlole 7047?, Vernon18
Annotated civil statutes, leviee 4 tax 0r twenty per oent
.-
449 -
Honorable George I?.Lheppsrd, Page 6
(SW) or the value or money, prizes and awards aglven ln
oonneotlon with the operation of saoh and all of the fore-
'going business enterprlses.w Rers the Legislature, In
maklna the aotual tar levy. did not reueat the terms
nthea