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month period ending on July 31 of any year. No claim shall be allowed under this paragraph with respect to any twelve month period unless filed on or before October 31 of the year in which such twelve month period ends.
“(2) Exception.-If $1,000 or more is payable under this section to any person with respect to lead additives used during any of the three month periods beginning August 1, November 1, February 1, and May 1 of each year, a claim may be filed under this section by such person with respect to lead additives used during such three month period. No claim filed under this paragraph shall be allowed unless filed on or before the last day of the three month period immediately following the three month
period for which the claim is filed. No claim shall be allowed under this subsection for amounts allowed as a credit under subsection (e).
"(e) Credit Against Tax Imposed By Section 4081.-Notwithstanding the provisions of subsection (d), a credit may be allowed against the tax imposed by section 4081 for an amount equal to the payment authorized by subsection (a) in respect of lead additives used by the producer of gasoline during the period for which the return of tax under section 4081 is made. “(f) Definitions.
“(1) Gasoline.—As used in this section, the term 'gasoline' shall have the same meaning as set forth in section 4082 (b).
“(2) Production of Gasoline.—As used in this section, the term production of gasoline' includes the refining, compounding and blending of gasoline.
"(3) Lead Additives.-As used in this section, the term 'lead additive' shall have the same meaning as set forth in section
4891 (g)(2). “(g) Applicable Laws.
"(1) In General.-All provisions of law, including penalties, applicable in respect of the tax imposed by section 4891 shall, insofar as applicable and not inconsistent with this section, apply in respect of the payments provided for in this section to the same extent as if such payments constituted refunds of overpayments of the tax so imposed.
“(2) Examination of Books and Witnesses.--For the purpose of ascertaining the correctness of any claim made under this section, or the correctness of any payment made in respect of any such claim, the Secretary or his delegate shall have the authority granted by paragraphs (1), (2), and (3) of section 7602. (relating to examination of books and witnesses) as if the claimant were the person liable for tax. "(h) Cross References.
“(1) For civil penalty for excessive claims under this section, see section 6675.
“(2) For fraud penalties, etc., see chapter 75 (section 7201 and following, relating to crimes, other offenses, and forfeitures)." (b) Conforming. Clerical, and Ter'inical Amendments, Etr.
(1) Sortion 4227 (cross references to manufacturers excise turns) is amended by adding at the end thereof the following new pariruph:
"(4) For credit for the payment for lead additives used in the production of gasoline, see section 6429."
(2) The table of sections for subchapter B of chapter 65 is ämnended by Iding at the end thereof the following:
"Sec. 6429. Lead additives used by refiners.' (3) Section 6206 is amended
(A) By striking out "and 6427" in the hearing of such sertion and inserting in lieu thereof "6427, and 6429'';
(B) By striking ont "or 6427" each place it appears in the text of such section and inserting in lieu thereof "6427, or 6429"; and
(C) By striking out "or 4041 (with respect to payments under section 6427" and inserting in lieu thereof "4041 (with respect to payments under section 6427), or 4891 (with
respect to payments under section 6429)”. (4) Section 6504 (cross references to limitations on assessment and collection) is amended by adding at the end thereof the following new paragraph:
"(16) Assessments to recover excessive amounts paid under section 6429 (relating to lead additives used in the production of gasoline) and assessments of civil penalties under section 6675 for excessive claims under section 6429, see section 6206."
(5) Section 6511 (relating to limitations on credit or refund) is amended by adding at the end of subsection (g) the following new paragraph:
"(7) For limitation in case of payments under section 6429 (relating to lead additives used in refining gasoline), see section 6429(d).” (6) Section 6675 is amended
(A) By striking out "Fuels Or Lubricating Oil.” in the heading of such section and inserting in lieu thereof “Fuels, Lubricating Oil, or Lead Additives.";
(B) By striking out "or" before "6427” in subsection (a), and by inserting after "taxable purposes)” in such subsection, or 6429 (relating to lead additives used in the production of gasoline)"; and
(C) By striking out "or 6427" in subsection (b)(1) and inserting in lieu thereof "6427, or 6429". (7) Sections 7210, 7603, and 7604, and the first sentence of section 7605(a) are each amended by inserting "6429(g)(2)", after “6427 (e) (2),”. The second sentence of section 7605(a) is amended by striking out “or 6427(e) (2)” and inserting in lieu thereof "6427(e) (2), or 6429(g)(2)".
(8) The table of sections for subchapter A of chapter 63 is amended by striking out "and 6427” in the item relating to section 6206 and inserting in lieu thereof "6427, and 6429".
(9) The table of sections for subchapter B of chapter 68 is amended by striking out "Fuels or lubricating oil" in the item relating to section 6675 and inserting in lie i thereof “Fuels,
lubricating oil, or lead additives”. SEC. 4. HIGHWAY TRUST FUND AMENDMENTS.
(a) Subsection (c) of section 209 of the Highway Revenue Act of 1956 (23 U.S.C., sec. 120 note) is amended by striking out “(tax on
gasoline)” in subparagraph (1)(A) and inserting in lieu thereof "(tax on gasoline without regard to the credit provided under section 6429(e))". SEC. 5. EFFECTIVE DATES.
(a) Tax on Lead Additives.—The amendments made by section 2(a) of this Act shall apply to the sale of lead additives or importation of gasoline containing lead additives after July 31, 1970, except that the floor stocks tax shall apply with respect to inventories of lead additives as of August 1, 1970.
(b) Payments With Respect to Use of Lead Additives. The amendments made by section 3(a) of this Act shall apply with respect to lead additives used in the production of gasoline after July 31, 1970. TECHNICAL EXPLANATION OF PROPOSED Bill To PROVIDE FOR A
Tax UPON LEAD ADDITIVES USED IN GASOLINE
SECTION 1. SHORT TITLE
Section 1 of the bill provides that it may be cited as the "Clean Air Tax Act of 1970”.
SECTION 2. TAX ON LEAD ADDITIVES
Section 2 of the bill adds subchapter F of Chapter 39 of the Internal Revenue Code (relating to regulatory taxes) to provide:
(a) Section 4891 (a) imposes a tax upon the sale of lead additives by the manufacturer, producer, or importer of a lead additive which is, by definition, to be used in the manufacture or production of gasoline. The rate of tax is $4.25 per pound of lead contained in the additive,
(b) Section 4891 (b) imposes a tax upon the lead content of imported gasoline at the rate of $4.25 per pound of lead therein. This provision is to prevent circumvention of the tax imposed on lead additives by importing gasoline containing lead additives for domestic consumption.
(c) Section 4891(c) imposes a floor stocks tax on inventories of lead additives held, on August 1, 1970, by anyone other than a manufacturer, producer, or importer of lead additives. The rate of tax is $4.25 per pound of lead. This provision is intended to bring the lead additive tax into full effect on August 1, 1970. Since sales of lead additives by a manufacturer, producer, or importer of lead additives will be taxable after July 31, 1970, such persons are not subject to the floor stocks tax. The phrase "importer thereof” is intended to limit exclusion from the coverage of the floor stocks tax to the actual importer who would be taxable upon a subsequent sale under section 4891(a). The second sentence of (c)(1) excludes the lead content of gasoline inventories held on August 1, 1970, from the floor stocks tax whether held by a refiner, distributor, or dealer. Paragraph (2) provides that the floor stocks tax shall be paid at such time after September 30, 1970, as the Secretary or his delegate may prescribe.
(d) Section 4891(d) provides that the use of a lead additive by a person, who would be taxable upon a sale (manufacturer, producer, or importer of a lead additive) under 4891(a), shall be considered a sale. This provision would protect the revenue when an integrated refiner of gasoline also produces lead additives for use in his refining operations or when the refiner is the importer of lead additives.
(e) Section 4891(e) provides that the tax upon the lead content of imported gasoline shall be collected in the same manner as a tariff duty.
(1) Section 4891(f) provides an exemption from the tax imposed y section 4891(a) for lead additives exported.
(g) Section 4891(g)(1) provides that the term "gasoline” has the same meaning given to such term by section 4082(b). Section 4082(b) defines "gasoline" as "all products commonly or commercially known or sold as gasoline which are suitable for use as a motor fuel." Any future change in the meaning of the term “gasoline” under the manufacturers excise tax provisions would automatically affect the definition for purposes of this subchapter.
(h) Section 4891(g)(2) defines the term "lead additive" to include any compound containing lead which is used in the production of gasoline. The definition is intended to be broad enough to cover lead additives presently being used (lead tetraethyl) or other additives containing lead which might be developed in the future.
(i) Section 4891 (h) provides a cross reference to general and administrative provisions of the Code.
() Section 2 (b) of the bill provides for the refund of the lead additive tax in the case of exportation of such additives upon which a tax has been paid under section 4891. The provision would be operative when there is an exportation subsequent to acquisition in a taxable transaction by a person who is not the original manufacturer or importer of the lead additives.
(k) Section 2(c) of the bill provides the following clerical amendments:
(1) A clerical amendment is made to add Subchapter F to the table of subchapters for chapter 39 (regulatory taxes) of Subtitle D (excise taxes).
(2) A clerical amendment is made to the table of sections for subchapter B of chapter 65 to include section 6428.
SECTION 3. PAYMENTS WITH RESPECT TO USE OF LEAD ADDITIVES
Section 3 of the bill adds section 6429 to subchapter B of Chapter 65 (relating to rules of special application for abatements, credits, and refunds) to provide:
(a) Section 6429(a) provides for the payment to producers of gasoline an amount equal to $4.25 for each pound of lead used in the production of gasoline, subject to the limitations contained in section 6429(b). The rate of $4.25 is the same as the rate of tax imposed upon the sale of lead additives under section 4891(a).
(b) Section 6429(b) limits the quantity of lead for which payment under section 6429(a) is to be made. The number of pounds of lead for which payment would be made is the lesser of the number determined under paragraph (1) or paragraph (2). Paragraph (1) provides that the number of pounds for which payment shall be made shall be the actual pounds of lead used in the twelve month period commencing August 1, 1970, and during each succeeding twelve month period, except that actual usage may not exceed the greater of the actual pounds used in the twelve month period preceding August 1, 1970, or the annual average of the number of pounds used during each of the three years preceding August 1, 1970. Notwithstanding a