[Federal Register Volume 59, Number 196 (Wednesday, October 12, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-25084]


[[Page Unknown]]

[Federal Register: October 12, 1994]


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DEPARTMENT OF THE TREASURY
 

Tax on Certain Imported Substances (Phosphorous Trichloride, 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 phosphorous trichloride and phosphorous pentasulfide.

EFFECTIVE DATE: This modification is effective January 1, 1995.

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), 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 September 29, 1994, the Secretary determined that phosphorous 
trichloride and phosphorous pentasulfide should be added to the list of 
taxable substances in section 4672(a)(3), effective January 1, 1995. 
The rate of tax prescribed for phosphorous trichloride, under section 
4671(b)(3), is $3.10 per ton. This is based upon a conversion factor 
for phosphorous of 0.23 and a conversion factor for chlorine of 0.77.
    The rate of tax prescribed for phosphorous pentasulfide, under 
section 4671(b)(3), is $1.24 per ton. This is based upon a conversion 
factor for phosphorous of 0.28. The petitioner is Monsanto 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.

Phosphorous Trichloride

HTS number: 2812.10.50.10
CAS number: 7719-12-2

    Phosphorous trichloride is derived from the taxable chemicals 
phosphorous and chlorine. Phosphorous trichloride is a liquid produced 
predominantly by the direct union of phosphorous and chlorine.
    The stoichiometric material consumption formula for phosphorous 
trichloride is:

P4 (phosphorous) + 6 Cl2 (chlorine) -----> 4 PCl3 
(phosphorous trichloride)

    Phosphorous trichloride 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.

Phosphorous Pentasulfide

HTS number: 2813.90.20.00
CAS number: 1314-80-3
    Phosphorous pentasulfide is derived from the taxable chemical 
phosphorous. Phosphorous pentasulfide is a solid produced predominantly 
by mixing molten phosphorous with molten sulfur.
    The stoichiometric material consumption formula for phosphorous 
pentasulfide is:

P4 (phosphorous) + 10 S (sulfur) -----> 2 P2S5 
(phosphorous pentasulfide)

    Phosphorous pentasulfide 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 94.6 percent by value of the materials 
used in its production. The stated cost for phosphorous is $0.91 per 
pound and the stated cost for sulfur is $0.02 per pound.
Dale D. Goode,
Federal Register Liaison Officer, Assistant Chief Counsel (Corporate).
[FR Doc. 94-25084 Filed 10-11-94; 8:45 am]
BILLING CODE 4830-01-U