holding that Texas gas and oil production taxes were not taxes on "gross income" because they did not include any deduction for expenses
How later courts described this case
- holding that Texas gas and oil production taxes were not taxes on "gross income" because they did not include any deduction for expenses
- "In ascertaining whether the Texas taxes are on or measured by income ... our task is to determine their true nature and not to be guided by labels."
Written by the judges who cited it.
The opinion
SIMS, J. †
I concur with part II of the opinion and the decision that the judgment must be affirmed.
I am of the conviction that the Legislature intended that state and local, and foreign, taxes not described in the first four numbered categories of subdivision (a) of section 17204 should be allowed as a deduction whenever they are paid or accrued within the taxable year as an expense of carrying on a trade or business, or as an expense of an activity producing income. I believe that the restriction of paragraph (2) of subdivision (c) of the section is strictly limited to taxes on or according to or measured by net income or profits after the deduction of taxes related tó the expenses of carrying on the trade or business or activity, even though such a tax is measured by gross income. I therefore refrain from joining in part I of the opinion and decision. Since I agree with the principles set forth in part II, which is determinative of the case, I refrain ' from elaborating on my views at this time.