[Federal Register Volume 72, Number 214 (Tuesday, November 6, 2007)]
[Notices]
[Page 62730]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-21754]


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DEPARTMENT OF THE TREASURY


Tax on Certain Imported Substances (Synthetic Linear Fatty 
Alcohols); Notice of Determinations

AGENCY: Internal Revenue Service (IRS), Treasury.

ACTION: Notice.

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SUMMARY: This notice announces a determination, under Notice 89-61, 
1989-1 C.B. 717, that the list of taxable substances in section 
4672(a)(3) will be modified to include synthetic linear fatty alcohols 
and synthetic linear fatty alcohol ethoxylates.

DATES: Effective Dates: This modification is effective as of July 1, 
1993, for synthetic linear fatty alcohols and October 1, 1993, for 
synthetic linear fatty alcohol ethoxylates.

FOR FURTHER INFORMATION CONTACT: Celia Gabrysh, Office of Associate 
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, 1969-1 C.B. 717, 
sets forth the rules relating to the determination process.

Determinations

    On October 19, 2007, the Secretary determined that synthetic linear 
fatty alcohols and synthetic linear fatty alcohol ethoxylates should be 
added to the list of taxable substances in section 4672(a)(3) of the 
Internal Revenue Code, effective as of July 1, 1993, and October 1, 
1993, respectively.
    The rate of tax prescribed for synthetic linear fatty alcohols will 
be based on the rate of tax for ethylene ($4.87 per ton) multiplied by 
the conversion factor for ethylene for the specified synthetic linear 
fatty alcohol.
    The rate of tax prescribed for synthetic linear fatty alcohol 
ethoxylates will be based on the rate of tax for ethylene ($4.87 per 
ton) multiplied by the conversion factor for ethylene for the specified 
synthetic linear fatty alcohol ethoxylate.
    The petitioner is Vista Chemical Company, a manufacturer and 
exporter of these substances. The following information is the basis 
for the determinations.

Synthetic Linear Fatty Alcohols

    Synthetic linear fatty alcohols are derived from the taxable 
chemical ethylene. They are produced predominantly by the Ziegler 
process.
    The stoichiometric material consumption formula for this substance 
is: x(CH2CH2) (ethylene) + 1/3Al (aluminum) + 1/
2H2 (hydrogen) + 1/2O2 (oxygen) + H2O 
(water) >< 
C2XH4x+1OH (synthetic linear fatty alcohols) + 1/
3Al(OH)3 (aluminum hydroxide).
    Synthetic linear fatty alcohols have been has been determined to be 
taxable substances because a review of the stoichiometric material 
consumption formula shows that, based on the predominant method of 
production, taxable chemicals constitute at least 50 percent by weight 
of the materials used in its production.

Synthetic Linear Fatty Alcohol Ethoxylates

    Synthetic linear fatty alcohol ethoxylates are predominately 
produced by base catalyzed ethoxylation of synthetic linear alcohols 
with ethylene oxide.
    The stoichiometric material consumption formula for this substance 
is: x(CH2CH2 (ethylene) + 1/3Al (aluminum) + 1/
2H2 (hydrogen) + 1/2O2 (oxygen) + H2O 
(water) + y(CH2CH2) (ethylene) + y/2O2 
(oxygen) [rarr] 
C2XH4x+1O(CH2CH2O)y
H (synthetic linear fatty alcohol ethoxylates) + 1/3Al(OH)3 
(aluminum hydroxide).
    Synthetic linear fatty alcohol ethoxylates have been has been 
determined to be taxable substances because a review of the 
stoichiometric material consumption formula shows that, based on the 
predominant method of production, taxable chemicals constitute at least 
50 percent by weight of the materials used in its production.

Frank Boland,
Chief, Branch 7, Office of Associate Chief Counsel (Passthroughs & 
Special Industries).
 [FR Doc. E7-21754 Filed 11-5-07; 8:45 am]
BILLING CODE 4830-01-P