IRS ADDS HEXABROMOCYCLODODECANE AND ETHYLENEBISTETRABROMOPHTHALIMIDE TO TAXABLE SUBSTANCES LIST.
Notice 95-38; 1995-1 C.B. 312
- Institutional AuthorsTreasury Department Internal Revenue Service
- Code Sections
- Subject Area/Tax Topics
- Index Termstoxics, imported, definitions and rules
- Jurisdictions
- LanguageEnglish
- Tax Analysts Document NumberDoc 60 F.R. 26478-26479
- Tax Analysts Electronic Citation1995 TNT 97-51
Notice 95-38
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 hexabromocyclododecane and ethylenebistetrabromophthalimide.
EFFECTIVE DATE: This modification is effective October 1, 1993.
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 chemical 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 CB 717, sets forth the rules relating to the determination process.
DETERMINATION
On May 8, 1995, the Secretary determined that hexabromocyclododecane and ethylenebistetrabromophthalimide should be added to the list of taxable substances in section 4672(a)(3), effective October 1, 1993.
The rate of tax prescribed for hexabromocyclododecane, under section 4671(b)(3), is $4.55, per ton. This is based upon a conversion factor for bromine of 0.747 and a conversion factor for butadiene of 0.253.
The rate of tax prescribed for ethylenebistetrabromophthalimide, under section 4671(b)(3), is $4.51 per ton. This is based upon a conversion factor for bromine of 0.672, a conversion factor for ethylene of 0.029, a conversion factor for xylene of 0.223, a conversion factor for ammonia of 0.036, and a conversion factor for chlorine of 0.075.
The petitioner is Ethyl Corporation, a manufacturer and exporter of these substances. No material comments were received on these petitions. The following information is the basis for the determinations.
HEXABROMOCYCLODODECANE
HTS number: 2903.59.00.00
CAS number: 3194-55-6
Hexabromocyclododecane is derived from the taxable chemicals bromine and butadiene. Hexabromocyclododecane is a solid produced predominantly be reacting cyclododecatriene with bromine in a solvent system, followed by a neutralization, a centrifugation, a strip, a wash, drying, and grinding (as required).
The stoichiometric material consumption formula for hexabromocyclododecane is:
3 (bromine) + 3 (butadiene) ---> hexabromocyclododecane
Hexabromocyclododecane 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 this production.
Ethylenebistetrabromophthalimide
HTS number: 2925.19.10.00
CAS number: 32588-76-4
Ethylenebistetrabromophthalimide is derived from the taxable chemicals bromine, ethylene, xylene, ammonia, and chlorine. Ethylenebistetrabromophthalimide is a solid produced predominantly by sulfonating and brominating phthalic anhydride in the presence of oleum and then hydrolyzing the resulting tetrabromophthalic anhydride in the presence of a solvent system and reacting it with ethylene diamine. The resulting ethylenebistetrabromophthalimide is centrifuged, washed, dried/converted, milled, and packaged.
The stoichiometric material consumption formula for ethylenebistetrabromophthalimide is:
4 (bromine) + ethylene + 2 o-xylene + 2 ammonia + chlorine + 6 oxygen
+ 8 sulfur trioxide ---> ethylenebistetrabromophthalimide + 8 water
+ 4 sulfur dioxide + 4 sulfuric acid + 2 hydrochloric acid
Ethylenebistetrabromophthalimide has been determined to be a taxable substance because a review off its stoichiometric material consumption formula shows that, based on the predominant method of production, taxable chemicals constitute 54.18 percent by weight of the materials used in its production.
Dale D. Goode,
Federal Register Liaison Officer,
Assistant Chief Counsel
Corporate)
- Institutional AuthorsTreasury Department Internal Revenue Service
- Code Sections
- Subject Area/Tax Topics
- Index Termstoxics, imported, definitions and rules
- Jurisdictions
- LanguageEnglish
- Tax Analysts Document NumberDoc 60 F.R. 26478-26479
- Tax Analysts Electronic Citation1995 TNT 97-51
