Calvert v. Canteen Co. (371 S.W.2d 556, 1963)

STEAKLEY, Justice.

Respondents, Canteen Company et al., are in the business of selling tangible personal property at retail from mechanical vending machines. They sell through the machines separate items with a sales price of twenty-four cents or less. The items consist generally of candy, chewing gum, coffee, and soft drinks. The Comptroller of Public Accounts, the principal petitioner, required respondents to pay a two per ■cent tax on the total receipts from their sales. Respondents did so under protest and fded claims for refund. The refunds were disallowed and respondents brought this suit as a class action. The judgment of the trial court ordering the refunds was affirmed by the Court of Civil Appeals, with one Justice dissenting. Calvert v. Canteen Company, 365 S.W.2d 662. We reverse the judgments of the courts below and render judgment for petitioners.

The tax statute is Article 20.01 et seq., Vernon’s Annotated Texas Statutes, Tax-•Gen., V.A.T.S., known as the Limited .Sales, Excise and Use Tax Act, Acts 57th Leg., 1st C.S., 1961, Ch. 24, p. 71. The pertinent provisions of the statute are as follows:

“Art. 20.02. Imposition of Limited Sales Tax.

“There is hereby imposed upon each separate sale at retail of tangible personal property made within this State a limited sales tax at the rate of two per cent (2%) of the sale price of each item or article of tangible personal property when sold at retail in this State.”

Article 20.01(L) (1): “‘Sales Price’ •means the total amount for which tangible personal property is sold, valued in money, whether paid in money or otherwise,” ■(with deductions not relevant here).

Article 20.02(A): “Method of Collection and Rate of Limited Sales Tax. The tax hereby imposed shall be collected by the retailer from the consumer.

“(1) The tax shall be as follows and shall be collected by using the following bracket system formula on each retail sale:

Amount Tax

$ .01 to $ .24 No Tax

.25 to .74 $ .01

.75 to 1.24 .02

1.25 to 1.74 .03

1.75 to 2.24 .04

Provided, further, that for each additional fifty cents (50‡) of purchase, or fraction thereof, one cent (l