[Federal Register Volume 60, Number 136 (Monday, July 17, 1995)]
[Notices]
[Pages 36458-36459]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-17382]



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DEPARTMENT OF THE TREASURY

Tax on Certain Imported Substances (Monoethanolamine, 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 monoethanolamine, diethanolamine, triethanolamine, 
monoisopropanolamine, diisopropanolamine, triisopropanolamine, toluene 
diisocyanate, and chlorinated polyethylene.

EFFECTIVE DATE: This modification is effective April 1, 1992.

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 July 10, 1995, the Secretary determined that monoethanolamine, 
diethanolamine, triethanolamine, monoisopropanolamine, 
diisopropanolamine, triisopropanolamine, toluene diisocyanate, and 
chlorinated polyethylene should be added to the list of taxable 
substances in section 4672(a)(3), effective April 1, 1992.
    The rate of tax prescribed for monoethanolamine, under section 
4671(b)(3), is $3.63 per ton. This is based upon a conversion factor 
for ethylene of 0.59 and a conversion factor for ammonia of 0.29.
    The rate of tax prescribed for diethanolamine, under section 
4671(b)(3), is $3.85 per ton. This is based upon a conversion factor 
for ethylene of 0.70 and a conversion factor for ammonia of 0.17.
    The rate of tax prescribed for triethanolamine, under section 
4671(b)(3), is $3.96 per ton. This is based upon a conversion factor 
for ethylene of 0.75 and a conversion factor for ammonia of 0.12.
    The rate of tax prescribed for monoisopropanolamine, under section 
4671(b)(3), is $6.66 per ton. This is based upon a conversion factor 
for propylene of 0.62, a conversion factor for chlorine of 1.00, a 
conversion factor for sodium hydroxide of 1.20, and a conversion factor 
for ammonia of 0.23.
    The rate of tax prescribed for diisopropanolamine, under section 
4671(b)(3), is $7.08 per ton. This is based upon a conversion factor 
for propylene of 0.70, a conversion factor for chlorine of 1.10, a 
conversion factor for sodium hydroxide of 1.30, and a conversion factor 
for ammonia of 0.13.
    The rate of tax prescribed for triisopropanolamine, under section 
4671(b)(3), is $7.49 per ton. This is based upon a conversion factor 
for propylene of 0.74, a conversion factor for chlorine of 1.20, a 
conversion factor for sodium hydroxide of 1.40, and a conversion factor 
for ammonia of 0.10.
    The rate of tax prescribed for toluene diisocyanate, under section 
4671(b)(3), is $4.90 per ton. This is based upon a conversion factor 
for toluene of 0.53, a conversion factor for nitric acid of 0.7, and a 
conversion factor for chlorine of 0.8.
    The rate of tax prescribed for chlorinated polyethylene, under 
section 4671(b)(3), is $5.05 per ton. This is based upon a conversion 
factor for ethylene of 0.65 and a conversion factor for chlorine of 
0.70.
    The petitioner is Dow Chemical 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.
Monoethanolamine

HTS number: 2922.11.00.00
CAS number: 141-43-5
    Monoethanolamine is derived from the taxable chemicals ethylene and 
ammonia and is a liquid produced predominantly by reacting ethylene 
oxide and aqueous ammonia.
    The stoichiometric material consumption formula for this substance 
is:

2 C2H4 (ethylene)+2 NH3 (ammonia)+O2 (oxygen) 
 2 C22H7NO (monoethanolamine)

    Monoethanolamine 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 73.7 percent by weight of the materials used in 
its production.

Diethanolamine

HTS number: 2922.12.00.00
CAS number: 111-42-2

 
[[Page 36459]]

    Diethanolamine is derived from the taxable chemicals ethylene and 
ammonia and is a solid produced predominantly by reacting ethylene 
oxide and aqueous ammonia.
    The stoichiometric material consumption formula for this substance 
is:

2 C2H4 (ethylene)+NH3 (ammonia)+O2 (oxygen) 
 C4H11NO2 (diethanolamine)

    Diethanolamine 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 69.5 percent by weight of the materials used in 
its production.

Triethanolamine

HTS number: 2922.13.00.00
CAS number: 102-71-6

    Triethanolamine is derived from the taxable chemicals ethylene and 
ammonia and is a liquid produced predominantly by reacting ethylene 
oxide and aqueous ammonia.
    The stoichiometric material consumption formula for this substance 
is:

6 C2H4 (ethylene)+2 NH3 (ammonia)+3 O2 (oxygen) 
 2 C6H15NO3 (triethanolamine)

    Triethanolamine 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 67.7 percent by weight of the materials used in 
its production.

Monoisopropanolamine

HTS number: 2922.19.60.00
CAS number: 78-96-6

    Monoisopropanolamine is derived from the taxable chemicals 
propylene, chlorine, sodium hydroxide, and ammonia and is a liquid 
produced predominantly by the reaction of propylene oxide and ammonia.
    The stoichiometric material consumption formula for this substance 
is:

2 C3H6 (propylene)+2 Cl2 (chlorine)+2 NaOH (sodium 
hydroxide)+NH3 (ammonia) + C3H9NO 
(monoisopropanolamine)+C3H6Cl2 (propylene dichloride)+2 
NaCl (sodium chloride) + H2O (water)

    Monoisopropanolamine 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.

Diisopropanolamine

HTS number: 2922.19.60.00
CAS number: 110-97-4

    Diisopropanolamine is derived from the taxable chemicals propylene, 
chlorine, sodium hydroxide, and ammonia and is a solid produced 
predominantly by the reaction of propylene oxide and ammonia.
    The stoichiometric material consumption formula for this substance 
is:

3 C3H6 (propylene)+2 Cl2 (chlorine)+2 NaOH (sodium 
hydroxide)+NH3 (ammonia)  C6H15NO2 
(diisopropanolamine) + C3H6Cl2 (propylene dichloride)+2 
NaCl (sodium chloride)+H2 (hydrogen)
    Diisopropanolamine 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.

Triisopropanolamine

HTS number: 2922.19.60.00
CAS number: 122-20-3

    Triisopropanolamine is derived from the taxable chemicals 
propylene, chlorine, sodium hydroxide, and ammonia and is a solid 
produced predominantly by the reaction of propylene oxide and ammonia.
    The stoichiometric material consumption formula for this substance 
is:

4 C3H6 (propylene)+3 Cl2 (chlorine)+4 NaOH (sodium 
hydroxide)+NH3 (ammonia)  C9H21NO3 
(triisopropanolamine)+C3H6Cl2 (propylene dichloride)+4 
NaCl (sodium chloride)+H2O (water)+H2 (hydrogen)

    Triisopropanolamine 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.
Toluene diisocyanate

HTS number: 2929.10.15.00
CAS number: 584-84-9

    Toluene diisocyanate is derived from the taxable chemicals toluene, 
nitric acid, and chlorine and is a liquid produced predominantly by the 
phosgenation of primary amines.
    The stoichiometric material consumption formula for this substance 
is:

C7H8 (toluene) + 2 HNO3 (nitric acid) + 2 Cl2 
(chlorine) + 2 CO (carbon monoxide) + 6 H2 (hydrogen) ------> 
C9H6N2O2 (toluene diisocyanate) + 6 H2O 
(water) +4 HCl (hydrogen chloride)

    Toluene diisocyanate 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 84 percent by weight of the materials used in its 
production.

Chlorinated polyethylene

HTS number: 3901.90.50.00
CAS number: 064754-90-1

    Chlorinated polyethylene is derived from the taxable chemicals 
ethylene and chlorine and is a solid produced predominantly by 
chlorination of polyethylene resins.
    The stoichiometric material consumption formula for this substance 
is:

857 C2H4 (ethylene) + 375 Cl2 (chlorine)  
C1714H3053Cl375 (chlorinated polyethylene) + 375 HCl 
(hydrogen chloride)

    Chlorinated polyethylene 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. 95-17382 Filed 7-14-95; 8:45 am]
BILLING CODE 4830-01-U