27 C.F.R. § 20.38 Liability for special tax.
Title 27 - Alcohol, Tobacco Products and Firearms
(a) Industrial alcohol permittee. Except as otherwise provided in this section, every person required to hold a permit under 26 U.S.C. 5271 to procure, use, sell, and/or recover denatured distilled spirits for industrial purposes shall pay a special (occupational) tax at the rate of $250 per year. A separate tax shall be paid for each industrial alcohol permit which the permittee holds, and permits issued under this part shall not be valid unless special tax is paid. The tax shall be paid on or before the date of commencing business as an industrial alcohol permittee, and thereafter every year on or before July 1. On commencing business, the tax shall be computed from the first day of the month in which liability is incurred, through the following June 30. Thereafter, the tax shall be computed for the entire year (July 1 through June 30). (b) Transition rule. For purposes of paragraph (a) of this section, a permittee engaged in denatured distilled spirits operations on January 1, 1988, shall be treated as having commenced business on that date. The special tax imposed by this transition rule shall cover the period January 1, 1988, through June 30, 1988, and shall be paid on or before April 1, 1988. (c) Each place of business taxable. Special (occupational) tax liability is incurred at each place of business for which a permit under subpart D of this part to procure, use, sell, and/or recover denatured distilled spirits has been issued. A place of business means the entire office, plant or area of the business in any one location under the same proprietorship. Passageways, streets, highways, rail crossings, waterways, or partitions dividing the premises are not sufficient separation to require additional special tax, if the divisions of the premises are otherwise contiguous. (d) Exception for United States. Agencies and instrumentalities of the United States are not required to pay special tax under this subpart. (e) Exemption for certain educational institutions (effective July 1, 1989). (1) On and after July 1, 1989, a scientific university, college of learning, or institution of scientific research, which holds a permit to procure and use specially denatured spirits under this part, is exempt from payment of special tax under this subpart if— (i) The university, college, or institution procures less than 25 gallons of specially denatured spirits per calendar year; and (ii) Such spirits are procured for use exclusively for experimental or research use and not for consumption (other than organoleptic tests) or sale. (2) A scientific university, college of learning, or institution of scientific research, which holds a permit under this part, and which does not operate as described in paragraphs (e)(1)(i) and (ii) of this section during any calendar year, shall pay special tax as provided in §20.38(a) for the special tax year (July 1 through June 30) commencing during that calendar year. (26 U.S.C. 5143, 5276) [T.D. ATF–271, 53 FR 17544, May 17, 1988, as amended by T.D. ATF–285, 54 FR 12610, Mar. 28, 1989]
Title 27: Alcohol, Tobacco and Firearms
PART 20—DISTRIBUTION AND USE OF DENATURED ALCOHOL AND RUM
Subpart Ca—Special (Occupational) Taxes
§ 20.38 Liability for special tax.
