26 U.S.C. § 4671 — Imposition of tax

Page 3001 TITLE 26—INTERNAL REVENUE CODE § 4671 1986—Subsec. (b)(7). Pub. L. 99–499, § 513(c), added par. (7). Subsec. (b)(8). Pub. L. 99–499, § 513(d), added par. (8). Subsec. (b)(9). Pub. L. 99–499, § 513(e)(1), added par. (9). Subsec. (b)(10). Pub. L. 99–499, § 513(g), added par. (10). Subsec. (c). Pub. L. 99–499, § 513(f), amended subsec. (c) generally. Prior to amendment, subsec. (c) read as fol- lows: ‘‘Except as provided in subsection (b), if any per- son manufactures, produces, or imports a taxable chemical and uses such chemical, then such person shall be liable for tax under section 4661 in the same manner as if such chemical were sold by such person.’’ Subsec. (d)(1). Pub. L. 99–499, § 513(b)(2), substituted ‘‘which is a taxable chemical’’ for ‘‘the sale of which by such person would be taxable under such section’’, in subpar. (B), and substituted ‘‘imposed by such section on the other substance manufactured or produced (or which would have been imposed by such section on such other substance but for subsection (b) or (e) of this sec- tion)’’ for ‘‘imposed by such section on the other sub- stance manufactured or produced’’ in last sentence. Subsec. (d)(4). Pub. L. 99–499, § 513(e)(2), added par. (4). Subsecs. (e), (f). Pub. L. 99–499, § 513(b)(1), added sub- sec. (e) and redesignated former subsec. (e) as (f). 1984—Subsec. (b)(1). Pub. L. 98–369, § 1019(a)(3), in- serted ‘‘or in the manufacture or production of any motor fuel, diesel fuel, aviation fuel, or jet fuel’’. Subsec. (b)(2)(A). Pub. L. 98–369, § 1019(b)(2)(A), sub- stituted ‘‘qualified fertilizer substance’’ for ‘‘qualified substance’’. Subsec. (b)(2)(B) to (D). Pub. L. 98–369, § 1019(b)(1), in- serted ‘‘fertilizer’’ after ‘‘qualified’’ wherever appearing in subpar. (B), inserted ‘‘fertilizer’’ after ‘‘Qualified’’ in subpar. (C) heading and in text substituted ‘‘The term ‘qualified fertilizer use’ means any use in the manufac- ture or production of fertilizer or for direct application as a fertilizer’’ for ‘‘For purposes of this subsection, the term ‘qualified use’ means any use in the manufacture or production of a fertilizer’’, and added subpar. (D). Subsec. (b)(5), (6). Pub. L. 98–369, § 1019(a)(1), added pars. (5) and (6). Subsec. (c). Pub. L. 98–369, § 1019(c), substituted ‘‘Ex- cept as provided in subsection (b), if’’ for ‘‘If’’. Subsec. (d)(2)(B). Pub. L. 98–369, § 1019(b)(2)(B), in- serted ‘‘fertilizer’’ after ‘‘qualified’’ and struck out ‘‘, or sells such substance for use,’’ after ‘‘such sub- stance’’. Subsec. (d)(3). Pub. L. 98–369, § 1019(a)(2), added par. (3). Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1999 AMENDMENT Amendment by Pub. L. 106–170 applicable to any in- strument held, acquired, or entered into, any trans- action entered into, and supplies held or acquired on or after Dec. 17, 1999, see section 532(d) of Pub. L. 106–170, set out as a note under section 170 of this title. EFFECTIVE DATE OF 1988 AMENDMENT Amendment by Pub. L. 100–647 effective, except as otherwise provided, as if included in the provision of the Superfund Revenue Act of 1986, Pub. L. 99–499, title V, to which it relates, see section 2001(e) of Pub. L. 100–647, set out as a note under section 56 of this title. EFFECTIVE DATE OF 1986 AMENDMENT Amendment by Pub. L. 99–499 effective Jan. 1, 1987, except as otherwise provided, see section 513(h) of Pub. L. 99–499, set out as a note under section 4661 of this title. EFFECTIVE DATE OF 1984 AMENDMENT Pub. L. 98–369, div. A, title X, § 1019(d), July 18, 1984, 98 Stat. 1024, provided that: ‘‘(1) IN GENERAL.—The amendments made by this sec- tion [amending this section] shall take effect as if in- cluded in the amendments made by section 211(a) of the Hazardous Substance Response Revenue Act of 1980 [Pub. L. 96–510, which enacted this section]. ‘‘(2) WAIVER OF LIMITATION.—If refund or credit of any overpayment of tax resulting from the application of the amendments made by this section is prevented at any time before the date which for one year after the date of the enactment of this Act [July 18, 1984] by the operation of any law or rule of law (including res judi- cata), refund or credit of such overpayment (to the ex- tent attributable to the application of such amend- ments) may, nevertheless, be made or allowed if claim therefor is filed on or before the date which for one year after the date of the enactment of this Act.’’ Subchapter C—Tax on Certain Imported Substances Sec. 4671. Imposition of tax. 4672. Definitions and special rules. Editorial Notes PRIOR PROVISIONS A prior subchapter C related to tax on hazardous wastes, consisted of sections 4681 and 4682, prior to re- peal by Pub. L. 99–499, title V, § 514(a)(1), Oct. 17, 1986, 100 Stat. 1767. § 4671. Imposition of tax (a) General rule There is hereby imposed a tax on any taxable substance sold or used by the importer thereof. (b) Amount of tax (1) In general Except as provided in paragraph (2), the amount of the tax imposed by subsection (a) with respect to any taxable substance shall be the amount of the tax which would have been imposed by section 4661 on the taxable chemi- cals used as materials in the manufacture or production of such substance if such taxable chemicals had been sold in the United States for use in the manufacture or production of such taxable substance. (2) Rate where importer does not furnish infor- mation to Secretary If the importer does not furnish to the Sec- retary (at such time and in such manner as the Secretary shall prescribe) sufficient infor- mation to determine under paragraph (1) the amount of the tax imposed by subsection (a) on any taxable substance, the amount of the tax imposed on such taxable substance shall be 10 percent of the appraised value of such substance as of the time such substance was entered into the United States for consump- tion, use, or warehousing. (3) Authority to prescribe rate in lieu of para- graph (2) rate The Secretary may prescribe for each tax- able substance a tax which, if prescribed, shall apply in lieu of the tax specified in paragraph (2) with respect to such substance. The tax prescribed by the Secretary shall be equal to the amount of tax which would be imposed by subsection (a) with respect to the taxable sub- stance if such substance were produced using the predominant method of production of such substance. (c) Exemptions for substances taxed under sec- tions 4611 and 4661 No tax shall be imposed by this section on the sale or use of any substance if tax is imposed on such sale or use under section 4611 or 4661. Page 3002 TITLE 26—INTERNAL REVENUE CODE § 4672 (d) Tax-free sales, etc. for substances used as cer- tain fuels or in the production of fertilizer or animal feed Rules similar to the following rules shall apply for purposes of applying this section with respect to taxable substances used or sold for use as described in such rules: (1) Paragraphs (2), (5), and (9) of section 4662(b) (relating to tax-free sales of chemicals used as fuel or in the production of fertilizer or animal feed). (2) Paragraphs (2), (3), and (4) of section 4662(d) (relating to refund or credit of tax on certain chemicals used as fuel or in the pro- duction of fertilizer or animal feed). (e) Termination No tax shall be imposed by this section after December 31, 2031. (Added Pub. L. 99–499, title V, § 515(a), Oct. 17, 1986, 100 Stat. 1767; amended Pub. L. 99–509, title VIII, § 8032(c)(3), Oct. 21, 1986, 100 Stat. 1958; Pub. L. 117–58, div. H, title II, § 80201(a)(2), (b)(2), Nov. 15, 2021, 135 Stat. 1328, 1330.) Editorial Notes AMENDMENTS 2021—Subsec. (b)(2). Pub. L. 117–58, § 80201(b)(2), sub- stituted ‘‘10 percent’’ for ‘‘5 percent’’. Subsec. (e). Pub. L. 117–58, § 80201(a)(2), amended sub- sec. (e) generally. Prior to amendment, text read as fol- lows: ‘‘No tax shall be imposed under this section dur- ing any period during which the Hazardous Substance Superfund financing rate under section 4611 does not apply.’’ 1986—Subsec. (e). Pub. L. 99–509 substituted ‘‘the Haz- ardous Substance Superfund financing rate under sec- tion 4611 does not apply’’ for ‘‘no tax is imposed under section 4611(a)’’. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2021 AMENDMENT Amendment by Pub. L. 117–58 effective July 1, 2022, see section 80201(d) of Pub. L. 117–58, set out as a note under section 4661 of this title. EFFECTIVE DATE OF 1986 AMENDMENT Amendment by Pub. L. 99–509 effective on commence- ment date as defined in former section 4611(f)(2), see section 8032(d) of Pub. L. 99–509, set out as a note under section 4611 of this title. EFFECTIVE DATE Pub. L. 99–499, title V, § 515(c), Oct. 17, 1986, 100 Stat. 1769, provided that: ‘‘The amendments made by this section [enacting this subchapter] shall take effect on January 1, 1989.’’ STUDY AND REPORT Pub. L. 99–499, title V, § 515(d), Oct. 17, 1986, 100 Stat. 1769, directed the Secretary of the Treasury or his dele- gate to conduct a study of issues relating to the imple- mentation of the tax imposed by this section and cer- tain credit for exports of taxable substances, and report to Congress not later than Jan. 1, 1988. § 4672. Definitions and special rules (a) Taxable substance For purposes of this subchapter— (1) In general The term ‘‘taxable substance’’ means any substance which, at the time of sale or use by the importer, is listed as a taxable substance by the Secretary for purposes of this sub- chapter. (2) Determination of substances on list A substance shall be listed under paragraph (1) if— (A) the substance is contained in the list under paragraph (3), or (B) the Secretary determines, in consulta- tion with the Administrator of the Environ- mental Protection Agency and the Commis- sioner of U.S. Customs and Border Protec- tion, that taxable chemicals constitute more than 20 percent of the weight (or more than 20 percent of the value) of the materials used to produce such substance (determined on the basis of the predominant method of pro- duction). If an importer or exporter of any substance re- quests that the Secretary determine whether such substance be listed as a taxable sub- stance under paragraph (1) or be removed from such listing, the Secretary shall make such determination within 180 days after the date the request was filed. (3) Initial list of taxable substances Cumene Methylene chloride Styrene Polypropylene Ammonium nitrate Propylene glycol Nickel oxide Formaldehyde Isopropyl alcohol Acetone Ethylene glycol Acrylonitrile Vinyl chloride Methanol Polyethylene resins, total Propylene oxide Polybutadiene Polypropylene resins Styrene-butadiene, latex Ethylene oxide Styrene-butadiene, snpf Ethylene dichloride Synthetic rubber, not con- taining fillers Cyclohexane Urea Isophthalic acid Ferronickel Maleic anhydride Ferrochromium nov 3 pct Phthalic anhydride Ferrochrome ov 3 pct. car- bon Ethyl methyl ketone Unwrought nickel Chloroform Nickel waste and scrap Carbon tetrachloride Wrought nickel rods and wire Chromic acid Nickel powders Hydrogen peroxide Phenolic resins Polystyrene homo- polymer resins Polyvinylchloride resins Melamine Polystyrene resins and co- polymers Acrylic and methacrylic acid resins Ethyl alcohol for nonbev- erage use Vinyl resins Ethylbenzene Vinyl resins, NSPF. (4) Modifications to list The Secretary shall add to the list under paragraph (3) substances which meet either the weight or value tests of paragraph (2)(B) and may remove from such list only sub- stances which meet neither of such tests. (b) Other definitions For purposes of this subchapter— (1) Importer The term ‘‘importer’’ means the person en- tering the taxable substance for consumption, use, or warehousing.