[Federal Register Volume 61, Number 61 (Thursday, March 28, 1996)]
[Notices]
[Pages 13919-13920]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-7608]
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DEPARTMENT OF THE TREASURY
Tax on Certain Imported Substances (Butyl Benzyl Phthalate);
Notice of Determination
AGENCY: Internal Revenue Service (IRS), Treasury.
ACTION: Notice.
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SUMMARY: This notice announces a determination, under Notice 89-61,
that the list of taxable substances in section 4672(a)(3) will be
modified to include butyl benzyl phthalate.
EFFECTIVE DATE: This modification is effective April 1, 1991.
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 that 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 March 22, 1996, the Secretary determined that butyl benzyl
phthalate should be added to the list of taxable substances in section
4672(a)(3), effective April 1, 1991.
The rate of tax prescribed for butyl benzyl phthalate, under
section 4671(b)(3), is $5.54 per ton. This is based upon a conversion
factor for methane of 0.05, a conversion factor for propylene of 0.17,
a conversion factor for xylene of 0.47, a conversion factor for toluene
of 0.32, and a conversion factor for chlorine of 0.26.
The petitioner is Monsanto Company, a manufacturer and exporter of
this substance. No material comments were received on this petition.
The following
[[Page 13920]]
information is the basis for the determination.
HTS number: 2917.39.2000
CAS number: 85-68-7
Butyl benzyl phthalate is derived from the taxable chemicals
methane, propylene, xylene, toluene, and chlorine and is a liquid
produced predominantly by the reaction of n-butanol and phthalic
anhydride, followed by a reaction with benzyl chloride in the presence
of a catalyst. n-butanol is manufactured by the hydrogenation of n-
butyraldehyde, which is derived from propylene and synthesis gas
(hydrogen and synthesis gas are derived from natural gas). Benzyl
chloride is produced by direct photochemical chlorination of toluene.
Phthalic anhydride is produced by the reaction of o-xylene with air in
the presence of a catalyst.
The stoichiometric material consumption formula for this substance
is:
CH4 (methane)+C3H6 (propylene)+C8H10
(xylene)+3 O2 (oxygen)+C7H8 (toluene)+Cl2
(chlorine) -------->C19H20O4 (butyl benzyl phthalate)+2
HCl (hydrochloric acid)+H2 (hydrogen)+2 H2O (water).
Butyl benzyl phthalate 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 77.25 percent by weight of the materials
used in its production.
Dale D. Goode,
Federal Register Liaison Officer, Assistant Chief Counsel (Corporate).
[FR Doc. 96-7608 Filed 3-27-96; 8:45 am]
BILLING CODE 4830-01-U
