[Federal Register Volume 60, Number 36 (Thursday, February 23, 1995)]
[Notices]
[Pages 10142-10143]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-4441]



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DEPARTMENT OF THE TREASURY
Internal Revenue Service


Tax on Certain Imported Substances (Cyclododecanol, 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 cyclododecanol, 1,5,9-cyclododecatriene, and adiponitrile.

EFFECTIVE DATE: This modification is effective July 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 February 7, 1995, the Secretary determined that cyclododecanol, 
1,5,9-cyclododecatriene, and adiponitrile should be added to the list 
of taxable substances in section 4672(a)(3), effective July 1, 1995.
    The rate of tax prescribed for cyclododecanol, under section 
4671(b)(3), is $6.21 per ton. This is based upon a conversion factor 
for butadiene of 1.22 and a conversion factor for methane of 0.08.
    The rate of tax prescribed for 1,5,9-cyclododecatriene, under 
section 4671(b)(3), is $5.64 per ton. This is [[Page 10143]] based upon 
a conversion factor for butadiene of 1.16.
    The rate of tax prescribed for adiponitrile, under section 
4671(b)(3), is $5.72 per ton. This is based upon a conversion factor 
for methane of 0.52, a conversion factor for ammonia of 0.42, and a 
conversion factor for butadiene of 0.58.
    The petitioner is E. I. du Pont de Nemours and 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.

Cyclododecanol

HTS number: 2906.19.00
CAS number: 1724-39-6

    Cyclododecanol is derived from the taxable chemicals butadiene and 
methane. Cyclododecanol is a solid produced predominantly by air 
oxidation of cyclododecane. Cyclododecane is produced by hydrogenation 
of 1,5,9-cyclododecatriene which is produced by the trimerization of 
butadiene.
    The stoichiometric material consumption formula for cyclododecanol 
is:

3 C4H6 (butadiene) + 0.75 CH4 (methane) + 1.5 H2O 
(water) + 0.5 O2 (oxygen) ----> C12H24O (cyclododecanol) 
+ 0.75 CO2 (carbon dioxide)

    Cyclododecanol 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 80.18 percent by weight of the materials used in 
its production.

1,5,9-cyclododecatriene

HTS number: 2906.19.00
CAS number: 4904-61-4

    1,5,9-cyclododecatriene is derived from the taxable chemical 
butadiene. 1,5,9-cyclododecatriene is a solid produced predominantly by 
trimerization of butadiene in the presence of a coordination-type 
catalyst.
    The stoichiometric material consumption formula for 1,5,9-
cyclododecatriene is:

3 C4H6 (butadiene) ----> C12H18 (1,5,9-
cyclododecatriene)

    1,5,9-cyclododecatriene 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.

Adiponitrile

HTS number: 2926.90.50
CAS number: 111-69-3

    Adiponitrile is derived from the taxable chemicals methane, 
ammonia, and butadiene. Adiponitrile is a liquid produced predominantly 
by the reaction of butadiene with hydrogen cyanide (derived from 
ammonia and from methane in natural gas).
    The stoichiometric material consumption formula for adiponitrile 
is:

2 CH4 (methane) + 2 NH3 (ammonia) + C4H6 
(butadiene) + 3 O2 (oxygen) ----> C6H8N2 
(adiponitrile) + 6 H2O (water)

    Adiponitrile 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 55.55 percent by weight of the materials used in its 
production.
Dale D. Goode,
Federal Register Liaison Officer, Assistant Chief Counsel (Corporate).
[FR Doc. 95-4441 Filed 2-22-95; 8:45 am]
BILLING CODE 4830-01-U