IRS Adds Butyl Benzyl Phthalate To Taxable Substances List.

The Service has added, effective April 1, 1991, butyl benzyl phthalate to the list of taxable substances in section 4672(a)(3). The rate of tax, under section 4671(b)(3), is $5.54 per ton.

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[1] 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 butyl benzyl phthalate. This modification is effective April 1, 1991.

Background

[2] Under section 4672(a), an importer or exporter of any

Determination

[3] On March 22, 1996, the Secretary determined that butyl

[4] 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.

[5] The petitioner is Monsanto Company, a manufacturer and exporter of this substance. No material comments were received on this petition. The following information is the basis for the determination.

[6] HTS number: 2917.39.2000

[7] CAS number: 85-68-7

[8] 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.

[9] The stoichiometric material consumption formula for this substance is:

(methane)+(propylene)+(xylene)+3(oxygen)+(toluene)+(chlorine)-->

[10] 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.

[11] The principal author of this notice is Ruth Hoffman, Office of Assistant Chief Counsel (Passthroughs and Special Industries). For further information regarding this notice contact Ruth Hoffman on (202) 622-3130 (not a toll-free number).