[Federal Register Volume 61, Number 209 (Monday, October 28, 1996)]
[Notices]
[Page 55708]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-27364]
Federal Register / Vol. 61, No. 209 / Monday, October 28, 1996 /
Notices
[[Page 55708]]
DEPARTMENT OF THE TREASURY
Fiscal Service
Bureau of the Public Debt
Demand Deposit Securities of the State and Local Government
Series; Average Marginal Tax Rate and Treasury Administrative Costs
AGENCY: Bureau of the Public Debt, Fiscal Service, Treasury.
ACTION: Notice of estimated average marginal tax rate and Treasury
administrative costs for Demand Deposit United States Treasury
Certificates of Indebtedness--State and Local Government Series.
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SUMMARY: This notice is being published to provide the information
necessary to apply the interest rate formula for Demand Deposit United
States Treasury Certificates of Indebtedness--State and Local
Government Series (31 CFR Part 344, Subpart C). The final regulations
governing securities of the State and Local Government Series which
appear in the current issue of the Federal Register, in setting out the
formula, make provision for the simultaneous publication of this notice
(31 CFR 344.5). The factor necessary to convert the interest rate to a
tax-exempt equivalent (1--the estimated average marginal tax rate of
purchasers of tax-exempt bonds) is 1-.29 or .71. The Treasury
administrative cost is five basis points.
EFFECTIVE DATE: October 28, 1996.
FOR FURTHER INFORMATION CONTACT: Fred Pyatt, Director, or Howard
Stevens, Supervisory Program Analyst, Division of Special Investments,
Parkersburg, WV, at (304) 480-7752.
SUPPLEMENTARY INFORMATION: The Department of the Treasury, under the
authority of Chapter 3102 of Title 31, United States Code, and pursuant
to the Tax Reform Act of 1986, Pub.L. 99-514, 1301(b), offers a demand
deposit United States Treasury Certificate of Indebtedness--State and
Local Government Series. This security is a one-day certificate of
indebtedness, issued in an amount of $1,000, or any higher dollar
amount, with interest accrued and added to the principal daily. In the
final regulations published simultaneously with this notice, provision
is made to provide by notice the information necessary to apply the
interest rate formula to the new demand deposit certificate, i.e., the
average yield for three-month Treasury bills at the most recent
auction, multiplied by one minus the estimated average marginal tax
rate (1-MTR) of purchasers of tax-exempt bonds, less the Treasury
administrative cost. The factor ``1-MTR'' is .71. The Treasury
administrative cost is 5 basis points. Both the ``1-MTR'' and the
Treasury administrative cost are subject to redetermination by the
Department of the Treasury. Any future changes will be published by
notice in the Federal Register.
Dated: October 21, 1996.
Gerald Murphy,
Fiscal Assistant Secretary.
[FR Doc. 96-27364 Filed 10-21-96; 4:58 pm]
BILLING CODE 4810-39-W
