[Federal Register Volume 60, Number 100 (Wednesday, May 24, 1995)]
[Notices]
[Page 27594]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-12765]



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DEPARTMENT OF THE TREASURY

Internal Revenue Service


Tax on Certain Imported Substances (Polybutylene, et. al); Notice 
of Determinations

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Notice.

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SUMMARY: This notice announces determinations, under Notice 89-61, that 
the list of taxable substances in section 4672(a)(3) will be modified 
to include polybutylene and polybutylene/ethylene.

EFFECTIVE DATE: This modification is effective July 1, 1990.

FOR FURTHER INFORMATION CONTACT: Ruth Hoffman, Office of Assistant 
Chief Counsel (Passthroughs and Special Industries), (202) 622-3130 
(not a toll-free number).

SUPPLEMENTARY INFORMATION:

Background

    Under section 4672(a), an importer or exporter of any substance may 
request that the Secretary determine whether the substance should be 
listed as a taxable substance. The Secretary shall add the substance to 
the list of taxable substances in section 4672(a)(3) if the Secretary 
determines that taxable chemicals constitute more than 50 percent of 
the weight, or more than 50 percent of the value, of the materials used 
to produce the substance. This determination is to be made on the basis 
of the predominant method of production. Notice 89-61, 1989-1 C.B. 717, 
sets forth the rules relating to the determination process.

Determination

    On May 16, 1995, the Secretary determined that polybutylene and 
polybutylene/ethylene should be added to the list of taxable substances 
in section 4672(a)(3), effective July 1, 1990.
    The rate of tax prescribed for polybutylene, under section 
4671(b)(3), is $4.70 per ton. This is based upon a conversion factor 
for butylene of 0.966.
    The rate of tax prescribed for polybutylene/ethylene, under section 
4671(b)(3), is $4.86 per ton. This is based upon a combined conversion 
factor for butylene and ethylene of 0.999.
    The petitioner is Pecten Chemicals, a manufacturer and exporter of 
these substances. No material comments were received on these 
petitions. The following information is the basis for the 
determinations.

Polybutylene

HTS number: 3902.90.00.10
CAS number: 25036-29-7

    Polybutylene is derived from the taxable chemical butylene. 
Polybutylene is a solid produced predominantly by the Zeigler-Nata 
Catalyzed, Bulk, Polymerization Process.
    The stoichiometric material consumption formula for polybutylene 
is:
n (C<INF>4H<INF>8) (butylene) ----> (C<INF>4H<INF>8)<INF>n 
(polybutylene)

    Polybutylene has been determined to be a taxable substance because 
a review of its stoichiometric material consumption formula shows that, 
based on the predominant method of production, taxable chemicals 
constitute 100 percent by weight of the materials used in its 
production.

Polybutylene/Ethylene

HTS number: 3902.90.00.10
CAS number: 54570-68-2

    Polybutylene/ethylene is derived from the taxable chemicals 
butylene and ethylene. Polybutylene/ethylene is a solid produced 
predominantly by the Zeigler-Nata Catalyzed, Bulk, Polymerization 
Process.
    The stoichiometric material consumption formula for polybutylene/
ethylene is:

n (C<INF>4H<INF>8) (butylene) + m (C<INF>2H<INF>4) (ethylene) ----> 
(C<INF>4H<INF>8)<INF>n(C<INF>2H<INF>4)<INF>m (polybutylene/ethylene)

    Polybutylene/ethylene has been determined to be a taxable substance 
because a review of its stoichiometric material consumption formula 
shows that, based on the predominant method of production, taxable 
chemicals constitute 100 percent by weight of the materials used in its 
production.
Dale D. Goode,
Federal Register Liaison Officer, Assistant Chief Counsel (Corporate).
[FR Doc. 95-12765 Filed 5-23-95; 8:45 am]
BILLING CODE 4830-01-U