[Federal Register Volume 59, Number 53 (Friday, March 18, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-6374]


[[Page Unknown]]

[Federal Register: March 18, 1994]


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DEPARTMENT OF THE TREASURY
 

Tax on Certain Imported Substances; Notice of Determination

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Notice.

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SUMMARY: This notice announces a determination, under Notice 89-61, 
that the list of taxable substances in section 4672(a)(3) of the 
Internal Revenue Code will be modified to include 2,2,4-trimethyl-1,3-
pentanediol diisobutyrate and 2,2,4-trimethyl-1,3-pentanediol 
monoisobutyrate.

EFFECTIVE DATE: This modification is effective April 1, 1991.

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

SUPPLEMENTARY INFORMATION:

Background

    Under section 4672(a) of the Internal Revenue Code, an importer or 
exporter of any substance may request that the Secretary determine 
whether such substance should be listed as a taxable substance. The 
Secretary shall add such 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 such 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 March 10, 1994, the Secretary determined that 2,2,4-trimethyl-
1,3-pentanediol diisobutyrate and 2,2,4-trimethyl-1,3-pentanediol 
monoisobutyrate should be added to the list of taxable substances in 
section 4672(a)(3) of the Internal Revenue Code, effective April 1, 
1991.
    The rate of tax prescribed for 2,2,4-trimethyl-1,3-pentanediol 
diisobutyrate, under section 4671(b)(3), is $5.44 per ton. This is 
based upon a conversion factor for methane of 0.3360 and a conversion 
factor for propylene of 0.8815.
    The rate of tax prescribed for 2,2,4-trimethyl-1,3-pentanediol 
monoisobutyrate, under section 4671(b)(3), is $3.60 per ton. This is 
based upon a conversion factor for methane of 0.2224 and a conversion 
factor for propylene of 0.5836.
    The petitioner is Eastman Chemicals Division, Eastman Kodak 
Company, a manufacturer and exporter of these substances. No material 
comments were received on these petitions. The following information is 
the basis for the determinations.

2,2,4-trimethyl-1,3-pentanediol diisobutyrate

HTS number: 2915.90.00.00
CAS number: 6846-50-0

    2,2,4-trimethyl-1,3-pentanediol diisobutyrate is derived from the 
taxable chemicals methane and propylene. 2,2,4-trimethyl-1,3-
pentanediol diisobutyrate is a liquid produced predominantly by 
condensation of isobutyraldehyde.
    The stoichiometric material consumption formula for 2,2,4-
trimethyl-1,3-pentanediol diisobutyrate is:

6 CH4 (methane) + 6 C3H6 (propylene) + 6 O2 
(oxygen) ---->C16H30O4 (2,2,4-trimethyl-1,3-pentanediol 
diisobutyrate) + C8H18O2 (2,2,4-trimethyl-1,3-
pentanediol) + 6 H2O (water)

    2,2,4-trimethyl-1,3-pentanediol diisobutyrate 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 64.4 percent by 
weight of the materials used in its production.

2,2,4-trimethyl-1,3-pentanediol monoisobutyrate

HTS number: 2915.60.00.00
CAS number: 25265-77-4

    2,2,4-trimethyl-1,3-pentanediol monoisobutyrate is derived from the 
taxable chemicals methane and propylene. 2,2,4-trimethyl-1,3-
pentanediol monoisobutyrate is a liquid produced predominantly by 
condensation of isobutyraldehyde.
    The stoichiometric material consumption formula for 2,2,4-
trimethyl-1,3-pentanediol monoisobutyrate is:

3 CH4 (methane) + 3 C3H6 (propylene) + 3 O2 
(oxygen) ----
>C3H7CHOHC(CH3)2CH2OOCC3H7 (2,2,4-
trimethyl-1,3-pentanediol monoisobutyrate) + 3 H2O (water)

    2,2,4-trimethyl-1,3-pentanediol monoisobutyrate 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 64.4 percent by 
weight of the materials used in its production.
Dale D. Goode,
Federal Register Liaison Officer, Assistant Chief Counsel (Corporate).
[FR Doc. 94-6374 Filed 3-17-94; 8:45 am]
BILLING CODE 4830-01-U