B-45563, NOVEMBER 23, 1944, 24 COMP. GEN. 404

B-45563, NOVEMBER 23, 1944, 24 COMP. GEN. 404

TAXES - STATE - GASOLINE - PURCHASES IN LOUISIANA THE STATUTORY GASOLINE TAXES AGGREGATING SIX CENTS PER GALLON IMPOSED BY THE STATE OF LOUISIANA--- AS DISTINGUISHED FROM THE CONSTITUTIONAL LEVY OF ONE CENT PER GALLON--- MAY BE REIMBURSED TO A CONTRACTOR FURNISHING GASOLINE TO THE UNITED STATES PURSUANT TO A CONTRACT, EXECUTED SUBSEQUENT TO JULY 6, 1944, PROVIDING THAT THE TAX EXCLUSIVE CONTRACT PRICE BE INCREASED BY THE AMOUNT OF STATE TAXES FOR WHICH EXEMPTION IS NOT GRANTED, WHERE THE GASOLINE IS DELIVERED IN SUCH QUANTITIES (LOTS OF LESS THAN 6,000 GALLONS AS DEFINED BY THE TAXING AUTHORITIES OF LOUISIANA) AND FOR SUCH PURPOSES (USE IN MOTOR VEHICLES) AS NOT TO BE WITHIN THE EXEMPTIVE PROVISIONS OF THE TAXING STATUTES.

COMPTROLLER GENERAL WARREN TO M. E. MARKWOOD, DEPARTMENT OF THE INTERIOR, NOVEMBER 23, 1944:

REFERENCE IS MADE TO YOUR LETTER OF NOVEMBER 4, 1944, AS FOLLOWS:

THERE IS ENCLOSED HEREWITH FOR A DECISION, PRIOR TO CERTIFICATION FOR PAYMENT, A VOUCHER COVERING REIMBURSEMENT DUE THE TRIANGLE REFINERIES,HOUSTON, TEXAS, FOR GASOLINE FURNISHED TO THIS SERVICE.

IT WILL BE NOTED THAT THE FIRM HAS CLAIMED THE SUM OF $12.00 REPRESENTING TAX AT THE RATE OF .06 PER GALLON, AND HAVE EXCLUDED FROM THEIR INVOICE THE REMAINDER OF THE STATE TAX, OR .01 PER GALLON, FOR WHICH A TAX EXEMPTION CERTIFICATE IS REQUIRED.

THIS OFFICE HAS BEEN ADVISED THAT THE GOVERNMENT IS NO LONGER EXEMPT FROM THE GASOLINE TAX LEVIED BY THE LEGISLATURE OF LOUISIANA ( SECTION 14 OF ACT 6 OF THE EXTRAORDINARY SESSION OF 1928 AND SECTION 14 OF ACT 87, 1936, AS AMENDED BY ACT 176 OF 1942) UNLESS THE GASOLINE IS DELIVERED IN LOTS OF 6,000 GALLONS OR MORE, OR TO THE ARMED FORCES OF THE UNITED STATES, NEITHER OF THESE PROVISIONS BEING APPLICABLE IN THE INSTANT CASE. THE EXEMPTIONS HERETOFORE GRANTED THE UNITED STATES GOVERNMENT WERE RESCINDED BY ACTS 130 AND 131 OF THE LEGISLATURE OF LOUISIANA, SESSION OF 1944, APPROVED BY THE GOVERNOR ON JULY 6, 1944.

NO INFORMATION HAS BEEN RECEIVED WITH RESPECT TO THE EXEMPTION OF THE TAX LEVIED UNDER ACT 1 OF THE EXTRAORDINARY SESSION OF 1932 ).01 PER GALLON) BUT IT IS APPARENTLY APPLICABLE TO PURCHASES OF GASOLINE BY THE GOVERNMENT IN ANY QUANTITY.

THE STATE TAXING AUTHORITIES ADVISE THAT THE TAX IS IMPOSED UPON THE DEALER OR THE FIRST HANDLER OF GASOLINE AND THAT TAX EXEMPTION CERTIFICATES FOR SALES SUBSEQUENTLY MADE BY THE DEALERS TO THE GOVERNMENT WILL NOT BE ACCEPTABLE. WITH THE RETURN OF THE VOUCHER PLEASE ADVISE IF THE STATE TAX INCLUDED THEREON MAY BE PAID IN THIS AND FUTURE CASES WITHOUT THE NECESSITY OF SECURING ,REFUSED" TAX EXEMPTION CERTIFICATES AS REQUIRED BY THE PROVISIONS OF PARAGRAPH 8 OF GENERAL REGULATIONS NO. 86--- REVISED.

THIS OFFICE IS NOT AUTHORIZED TO RENDER A DECISION TO A CERTIFYING OFFICER EXCEPT IN CONNECTION WITH A QUESTION OF LAW INVOLVED IN PAYMENT OF A SPECIFIC VOUCHER PRESENTED TO HIM FOR CERTIFICATION AND ACCOMPANYING HIS REQUEST; AND, WHILE IT APPEARS THAT ONE ALBERT J. WILSON HAS EXECUTED THE FORM OF CERTIFICATION CONTAINED IN THE VOUCHER TRANSMITTED BY YOU, THE CONCLUSION APPEARS JUSTIFIED THAT THE ADMINISTRATIVE PROCEDURE FOLLOWED WITH RESPECT TO SUCH MATTERS CONTEMPLATES THAT PAYMENT WILL NOT BE MADE ON THE VOUCHER HERE INVOLVED UNLESS CERTIFIED BY YOU.

THE SUBJECT VOUCHER COVERS THE PURCHASE PRICE OF 200 GALLONS OF GASOLINE DELIVERED BY THE TRIANGLE REFINERIES TO THE UNITED STATES FISHERIES STATION AT NATCHITOCHES, LOUISIANA, IN COMPLIANCE WITH PURCHASE ORDER NO. 55737 ISSUED UNDER THE TERMS OF CONTRACT NO. TPS 68374, FOR USE IN CONNECTION WITH THE OPERATION OF GOVERNMENT-OWNED MOTOR VEHICLES AND IT IS ASSUMED, IN THE ABSENCE OF ANY REPRESENTATION BY YOU TO THE CONTRARY, THAT NO DOUBT EXISTS AS TO THE RIGHT OF THE STATE OF LOUISIANA TO TAX OR REGULATE THE ACTIVITIES OF INDIVIDUALS OR CORPORATIONS AT THE SITE WHERE THE SALE WAS CONSUMMATED. ALSO, IT APPEARS THAT SAID VOUCHER DOES NOT INCLUDE ANY ITEM REPRESENTING A CHARGE ON ACCOUNT OF THE TAX OF ONE CENT PER GALLON IMPOSED BY THE TERMS OF ARTICLE VI-A OF THE CONSTITUTION OF LOUISIANA ( ACT 1 OF THE EXTRA SESSION OF THE LEGISLATURE OF 1930, REFERRED TO BY YOU AS 1932) ON EACH GALLON OF GASOLINE SOLD IN THAT STATE AND FROM THE PAYMENT OF WHICH EXEMPTION IS SPECIFICALLY AUTHORIZED BY SAID ENACTMENT IN THE CASE OF ALL GASOLINE SOLD TO AGENCIES OF THE FEDERAL GOVERNMENT.

SAID CONTRACT NO. TPS-68374, CONSISTING OF THE BID OF THE TRIANGLE REFINERIES DATED JULY 6, 1944, AND THE GOVERNMENT'S ACCEPTANCE THEREOF DATED AUGUST 3, 1944, PROVIDES FOR THE FURNISHING OF TANK WAGON AND DRUM DELIVERIES AND TANK CAR AND TRANSPORT TRUCK DELIVERIES OF GASOLINE IN VARIOUS STATES, INCLUDING LOUISIANA, DURING THE PERIOD AUGUST 1 TO OCTOBER 31, 1944, AND ALTHOUGH THE PRICES SET FORTH IN THE CONTRACTOR'S BID WERE QUOTED ON A STATE TAX-EXCLUSIVE BASIS IT APPEARS THAT PARAGRAPH 11 (C) (2) OF THE SPECIAL CONDITIONS OF THE BID EXPRESSLY STIPULATES THAT---

IF ON OR AFTER THE DATE SET FOR THE OPENING OF BIDS THE APPROPRIATE TAX OFFICIAL OF ANY STATE OR LOCAL GOVERNMENT SHOULD AUTHORITATIVELY REFUSE TO ACCEPT, IN LIEU OF THE PAYMENT OF ANY APPLICABLE TAX, EXEMPTION CERTIFICATES ISSUABLE TO THE CONTRACTOR HEREUNDER WITH RESPECT TO SUCH TAX, THEN AND IN THAT EVENT THE AMOUNT OTHERWISE PAYABLE TO THE CONTRACTOR WITH RESPECT TO THE SALES AFFECTED THEREBY SHALL BE INCREASED BY THE AMOUNT OF THE TAX. IN CONSIDERATION OF SUCH INCREASE, THE BIDDER AGREES FULLY TO COOPERATE WITH THE GOVERNMENT, TO EXECUTE SUCH FORMS OR DOCUMENTS AS MAY BE REQUIRED BY THE GOVERNMENT, AND TO TAKE SUCH STEPS AS MAY BE REQUESTED BY THE GOVERNMENT IN ORDER TO PRESERVE TO THE GOVERNMENT ANY AND ALL RIGHTS TO THE REFUND OF SUCH TAXES, AND TO ASSIST THE GOVERNMENT IN ANY PROCEEDINGS BROUGHT FOR THE RECOVERY THEREOF BY LITIGATION OR OTHERWISE.

AS HAS BEEN POINTED OUT IN PRIOR DECISIONS OF THIS OFFICE (SEE 23 COMP. GEN. 957 AND CASES CITED THEREIN), THE LANGUAGE USED BY THE SUPREME COURT OF THE UNITED STATES IN ITS DECISION IN THE CASE OF ALABAMA V. KING AND BOOZER, 314 U.S. 1, LEAVES NO ROOM FOR DOUBT THAT A PERSON WHO SELLS SUPPLIES TO THE UNITED STATES IS NOT--- MERELY BECAUSE OF THE IMMUNITY OF THE FEDERAL GOVERNMENT FROM STATE TAXATION--- EXEMPT FROM THE PAYMENT OF AN OTHERWISE APPLICABLE STATE TAX WHERE IT APPEARS THAT THE LEGAL INCIDENCE OF THE TAX RESTS UPON HIM AS THE VENDOR AND NOT UPON THE UNITED STATES AS THE VENDEE. HENCE, PAYMENT PROPERLY MAY BE REQUIRED BY A STATE FROM A VENDOR OF A TAX OF THAT TYPE IN THE CASE OF SUCH SALES TO THE UNITED STATES AS ARE CONSUMMATED WITHIN THE TERRITORIAL JURISDICTION OF A STATE UNLESS THE STATE LAW OR THE REGULATIONS PROMULGATED BY THE STATE TAXING AUTHORITIES WITH RESPECT THERETO EXCEPT THE TRANSACTIONS FROM THE OPERATION OF THE TAXING STATUTE INVOLVED.

IN THE INSTANT CASE IT IS CLEAR FROM A CONSIDERATION OF THE STATUTES ENACTED BY THE LEGISLATURE OF LOUISIANA--- ACT NO. 6, EXTRA SESSION OF 1928, AS AMENDED, AND ACT NO. 87 OF 1936, AS AMENDED--- PRESCRIBING THE TAXES IN THE AGGREGATE AMOUNT OF SIX CENTS PER GALLON FOR WHICH A CHARGE IS INCLUDED IN THE SUBJECT VOUCHER THAT SUCH TAXES ARE EXCISE TAXES IMPOSED ON DEALERS IN GASOLINE AND THAT THE LEGAL INCIDENCE THEREOF DOES NOT REST UPON THE CONSUMER OR VENDEE. ALSO, IT APPEARS THAT THE FEDERAL GOVERNMENT FROM SAID TAXES WERE AMENDED BY THE LOUISIANA LAWS OF 1944--- ACTS NOS. 130 AND 131, APPROVED JULY 6, 1944- - SO AS TO LIMIT THE EXEMPTION TO ONLY SUCH TRANSACTIONS AS INVOLVE "GASOLINE DELIVERED IN LOTS OF 6,000 GALLONS OR MORE, TO THE UNITED STATES GOVERNMENT" OR "GASOLINE DELIVERED TO THE ARMED FORCES OF THE UNITED STATES FOR PROPELLING SHIPS OF THE UNITED STATES NAVY OR COAST GUARD, OR FOR AVIATION PURPOSES; " AND IT IS APPARENT FROM AN EXAMINATION OF THE REGULATION DATED JULY 29, 1944, OF THE DEPARTMENT OF REVENUE OF LOUISIANA WITH RESPECT THERETO THAT THE TAXING AUTHORITIES OF THAT STATE WILL NOT RELIEVE A CONTRACTOR FROM THE PAYMENT OF THE TAXES IMPOSED BY THE ABOVE-MENTIONED STATUTES IN THE CASE OF SALES TO THE UNITED STATES FOR USE IN THE OPERATION OF MOTOR VEHICLES EXCEPT WHERE (1) "6,000 GALLONS OR MORE OF GASOLINE SHALL BE ORDERED AT ONE TIME, WHICH ORDER SHALL BE EVIDENCED BY WRITING" AND DELIVERY IS "MADE AT THE RATE OF NOT LESS THAN 6,000 GALLONS DURING A SEVENTY-TWO HOUR PERIOD" OR (2) THE "CONTRACTS OR OTHER AGREEMENTS" COVERING THE SALE OF THE GASOLINE WERE "EXECUTED PRIOR TO JULY 6, 1944," AND "SPECIFICALLY NAME THE AMOUNTS AND PRICE OF THE GASOLINE SOLD, AND ARE IN WRITING OR EVIDENCED BY WRITING.'

CONSEQUENTLY, SINCE IT APPEARS THAT THE GASOLINE COVERED BY THE PURCHASE ORDER HERE INVOLVED WAS LESS THAN 6,000 GALLONS AND THAT THE CONTRACT UNDER WHICH SAID ORDER WAS ISSUED WAS EXECUTED SUBSEQUENT TO JULY 6, 1944, THERE CAN BE NO REASONABLE BASIS FOR A CONTENTION THAT THE CONTRACTOR IS NOT REQUIRED TO PAY THE APPLICABLE STATE TAXES IN THE AGGREGATE AMOUNT OF SIX CENTS PER GALLON ON THE GASOLINE; AND, SUCH BEING THE CASE, THE GOVERNMENT IS OBLIGATED UNDER THE TERMS OF THE CONTRACT TO PAY THE CONTRACTOR AN AMOUNT REPRESENTING SUCH TAXES IN ADDITION TO THE PRICES OTHERWISE DETERMINED THEREFOR.

ACCORDINGLY, YOU ARE ADVISED THAT CERTIFICATION FOR PAYMENT OF THE INSTANT VOUCHER, WHICH IS RETURNED HEREWITH, IS AUTHORIZED, IF CORRECT IN OTHER RESPECTS.

MOREOVER, IN VIEW OF THE FACT, AS HEREINBEFORE STATED, THAT THE EXEMPTIVE PROVISIONS OF THE TAXING STATUTES OF LOUISIANA HERE FOR CONSIDERATION DO NOT EMBRACE A TRANSACTION OF THE TYPE COVERED BY THE INSTANT VOUCHER, AND SINCE THERE IS NO REASON TO SUPPOSE THAT THE TAXING AUTHORITIES OF THAT STATE WOULD COMPLY WITH A REQUEST OF THE UNITED STATES FOR A REFUND OF THE AMOUNT OF THE SUBJECT TAXES, IT MUST BE CONCLUDED THAT NO USEFUL PURPOSE WOULD BE SERVED BY THE ISSUANCE OR OBTAINING OF A U.S. GOVERNMENT TAX EXEMPTION CERTIFICATE WITH RESPECT TO SUCH TAXES. HENCE, THE PROVISIONS OF GENERAL REGULATIONS NO. 86 REVISED, 16 COMP. GEN. 1130, NEED NOT BE REGARDED AS FOR APPLICATION IN THE INSTANT CASE. COMPARE IN THIS CONNECTION THE DECISION OF AUGUST 23, 1944, OF THIS OFFICE TO THE POSTMASTER GENERAL, 24 COMP. GEN. 150.