[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
