[Federal Register Volume 59, Number 130 (Friday, July 8, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-16484]
[[Page Unknown]]
[Federal Register: July 8, 1994]
-----------------------------------------------------------------------
DEPARTMENT OF THE TREASURY
Tax on Certain Imported Substances (Sodium Nitriolotriacetate
Monohydrate, et al.); Notice of Determinations
AGENCY: Internal Revenue Service (IRS), Treasury.
ACTION: Notice.
-----------------------------------------------------------------------
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 sodium nitriolotriacetate monohydrate, diphenyl oxide, and
tetrachlorophthalic anhydride.
EFFECTIVE DATE: This modification is effective April 1, 1993.
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 June 30, 1994, the Secretary determined that sodium
nitriolotriacetate monohydrate, diphenyl oxide, and tetrachlorophthalic
anhydride should be added to the list of taxable substances in section
4672(a)(3), effective April 1, 1993.
The rate of tax prescribed for sodium nitriolotriacetate
monohydrate, under section 4671(b)(3), is $2.45 per ton. This is based
upon a conversion factor for methane of 0.24, a conversion factor for
sodium hydroxide of 0.52, a conversion factor for propylene of 0.25,
and a conversion factor for ammonia of 0.10.
The rate of tax prescribed for diphenyl oxide, under section
4671(b)(3), is $8.13 per ton. This is based upon a conversion factor
for benzene of 1.05 and a conversion factor for propylene of 0.62.
The rate of tax prescribed for tetrachlorophthalic anhydride, under
section 4671(b)(3), is $5.87 per ton. This is based upon a conversion
factor for chlorine of 1.22 and a conversion factor for xylene of 0.53.
The petitioner is Monsanto 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.
Sodium nitriolotriacetate monohydrate
HTS number: 2922.49.60.00
CAS number: 18662-53-8
Sodium nitriolotriacetate monohydrate is derived from the taxable
chemicals methane, sodium hydroxide, propylene, and ammonia. Sodium
nitriolotriacetate monohydrate is a solid produced predominantly by the
reaction of formaldehyde with hydrogen cyanide in the presence of a
catalyst, which is then further reacted with sodium hydroxide to
produce sodium nitriolotriacetate monohydrate.
The stoichiometric material consumption formula for sodium
nitriolotriacetate monohydrate is:
3 CH4 (methane)+3 NaOH (sodium hydroxide)+C3H6
(propylene)+NH3 (ammonia)+4.5 O2 (oxygen)
N(CH2COONa)3H2O (sodium nitriolotriacetate
monohydrate)+5 H2O (water)+3 H2 (hydrogen)
Sodium nitriolotriacetate monohydrate 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 61.1 percent by weight of the
materials used in its production.
Diphenyl oxide
HTS number: 2909.30.00.00
CAS number: 101-84-8
Diphenyl oxide is derived from the taxable chemicals benzene and
propylene. Diphenyl oxide is a solid produced predominantly by the
catalytic condensation of phenol.
The stoichiometric material consumption formula for diphenyl oxide
is:
2 C6H6 (benzene)+2 C3H6 (propylene)+2 O2
(oxygen) C12H10O (diphenyl oxide)+2 C3H6O
(acetone)+H2O (water)
Diphenyl oxide 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 78.9 percent by weight of the materials used in
its production.
Tetrachlorophthalic anhydride
HTS number: 2916.19.00.00
CAS number: 117-08-8
Tetrachlorophthalic anhydride is derived from the taxable chemicals
chlorine and xylene. Tetrachlorophthalic anhydride is a solid produced
predominantly by the high temperature reaction of phthalic anhydride
with chlorine. Phthalic anhydride is produced by the reaction of o-
xylene with air in the presence of a catalyst.
The stoichiometric material consumption formula for
tetrachlorophthalic anhydride is:
4 Cl2 (chlorine)+C8H10 (xylene)+3 O2 (oxygen)
C8Cl4O3 (tetrachlorophthalic anhydride)+3
H2O (water) + 4 HCl (hydrogen chloride)
Tetrachlorophthalic anhydride 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 80.0 percent by weight of the materials
used in its production.
Dale D. Goode,
Federal Register Liaison Officer, Assistant Chief Counsel (Corporate).
[FR Doc. 94-16484 Filed 7-7-94; 8:45 am]
BILLING CODE 4830-01-U
