[Federal Register Volume 59, Number 59 (Monday, March 28, 1994)]
[Unknown Section]
[Page ]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-7155]


[Federal Register: March 28, 1994]


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DEPARTMENT OF THE TREASURY

Tax on Certain Imported Substances; Filing of Petitions

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Notice.

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SUMMARY: This notice announces the acceptance, under Notice 89-61, 
1989-1 C.B. 717, of petitions requesting that tetrahydrofuran and 1,4 
butanediol be added to the list of taxable substances in section 
4672(a)(3) of the Internal Revenue Code. Publication of this notice is 
in compliance with Notice 89-61. This is not a determination that the 
list of taxable substances should be modified.

DATES: Written comments and requests for a public hearing relating to 
these petitions must be received by May 27, 1994. Any modification of 
the list of taxable substances based upon these petitions would be 
effective October 1, 1994.

ADDRESSES: Send comments and requests for a public hearing to: 
CC:DOM:CORP:T:R (Petition), room 5228, Internal Revenue Service, POB 
7604, Ben Franklin Station, Washington, DC 20044.

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: The petitions were received on December 27, 
1993. The petitioner is E. I. DuPont de Nemours and Company, a 
manufacturer and exporter of these substances. The following is a 
summary of the information contained in the petitions. The complete 
petitions are available in the Internal Revenue Service Freedom of 
Information Reading Room.

Tetrahyrofuran

HTS number: 2932.11.00.00
CAS number: 109-99-9

    This substance is derived from the taxable chemicals methane and 
acetylene. Tetrahyrofuran is a liquid produced predominantly by the 
reaction of acetylene (derived from methane in natural gas) with 
formaldehyde made by air oxidation and dehydrogenation of methanol 
(derived from methane in natural gas) producing the intermediate 
butynediol which is in turn reacted with hydrogen (derived from methane 
in natural gas) to produce 1,4 butanediol. The 1,4 butanediol is ring 
closed using an acid catalyst to produce tetrahydrofuran.
    The stoichiometric material consumption formula for this substance 
is:

C2H2 (acetylene) + 3 CH4 (methane) + 0.5 O2 
(oxygen) + 2 H2O (water)  C4H8O 
(tetrahydrofuran) + 5 H2 (hydrogen) + CO2 (carbon dioxide)

    According to the petition, taxable chemicals constitute 58.7 per 
cent by weight of the materials used to produce this substance. The 
rate of tax for this substance would be $5.28 per ton. This is based 
upon a conversion factor for acetylene of 0.40 and a conversion factor 
for methane of 0.97.

1,4 butanediol

HTS number: 2905.39.10.00
CAS number: 110-63-4

    This substance is derived from the taxable chemicals methane and 
acetylene. 1,4 butanediol is a liquid produced predominantly by the 
reaction of acetylene (derived from methane in natural gas) with 
formaldehyde made by air oxidation and dehydrogenation of methanol 
(derived from methane in natural gas) producing the intermediate 
butynediol which is in turn reacted with hydrogen (derived from methane 
in natural gas) to produce 1,4 butanediol.
    The stoichiometric material consumption formula for this substance 
is:

3 CH4 (methane) + C2H2 (acetylene) + 3 H2O (water) 
+ 0.5 O2 (oxygen)  C4H10O2 (1,4 
butanediol) + 5 H2 (hydrogen) + CO2 (carbon dioxide)

    According to the petition, taxable chemicals constitute 51.3 per 
cent by weight of the materials used to produce this substance. The 
rate of tax for this substance would be $4.20 per ton. This is based 
upon a conversion factor for methane of 0.77 and a conversion factor 
for acetylene of 0.32.
Dale D. Goode,
Federal Register Liaison Officer, Assistant Chief Counsel (Corporate).
[FR Doc. 94-7155 Filed 3-25-94; 8:45 am]
BILLING CODE 4830-01-U