7 U.S.C. § 616 — Stock on hand when tax takes effect or terminates

submitted 93 years ago by ch. 25 to r/title-7-AGRICULTURE · 1,559 words · no verdicts yet

in plain englishAI-generated · not legal advice

This section adjusts processing taxes on products held when a tax begins, ends, rises, or falls. It sets rules for retail stocks, certain sugar, wheat, cotton, exports, and products in process, and does not apply to rice.

(a) When an article made wholly or mainly from a commodity subject to a processing tax is held for sale or disposition, including in transit, on the date the tax begins or ends, the tax must be adjusted as follows. (1) When the tax begins, the holder must pay a tax equal to the tax that would have applied to the commodity if it had been processed on that date. For imported articles in customs custody on the effective date, payment is due before release. For sugar, the floor-stocks tax, except on retail stocks, is paid for the month when the stocks are sold or used to make other articles, under rules of the Commissioner of Internal Revenue approved by the Treasury Secretary. (2) When the tax ends, the holder receives a refund or credit if the tax was paid; receives a credit or abatement if the tax is payable and the holder is the liable processor; or, if the holder is not that processor, receives a refund or credit after payment. The amount equals the tax that would have applied if processing occurred on the ending date. For a commodity whose tax rate increased before June 1, 1934, the refund, credit, or abatement cannot exceed the equivalent of the initial rate. (b) The beginning-tax rule does not apply to retail stocks held by retailers when the tax begins. Retail stocks do not include warehouse stocks held then or other stocks not sold or disposed of within 30 days. Except for specified flour, wheat-cereal preparations, and cotton articles, the ending-tax refund, credit, or abatement does not apply to retailer stocks. It also does not apply to articles, except sugar, made wholly or mainly from sugar beets, sugarcane, or their products, or to wheat articles, except the specified flour and cereal preparations, held when the tax ends. (c) The following are exempt from (a): (1) qualifying sugar imported before the sugar-beet and sugarcane tax began, if the required duty at the January 1, 1934 rate was paid; (2) sugar held on April 25, 1934 by, or to be delivered under a qualifying pre-April-25 contract to, a manufacturer or converter for making an article other than sugar and not for ultimate sugar consumption; and (3) articles other than sugar made wholly or mainly from sugar beets, sugarcane, or their products. Sugar in customs custody on April 25, 1934 is not exempt unless the duty paid on withdrawal was the January 1, 1934 rate. (d) While this chapter applies to sugar beets and sugarcane, the Agriculture Secretary may use available tax proceeds to buy up to 300,000 tons, raw value, of surplus direct-consumption sugar from the United States beet-sugar area. The price cannot exceed the market price on purchase. The Secretary may sell or otherwise dispose of it, including giving it to an unemployment-relief organization, under conditions and at times that further section 608a's policy. The purchased sugar is not counted in that area's quota. All proceeds are appropriated for the Secretary's purposes under section 612(a) and (b). (e) When the tax rate rises or falls, adjustments apply to held articles and articles produced from commodities in process on the change date. (1) On or after June 1, 1934, when the rate falls, the holder receives a credit or refund equal to the old rate minus the rate that would have applied if processing occurred on the change date. No credit or refund is made for hogs unless the old rate is no higher than the rate when a prior floor-stocks tax was paid. For wheat, this paragraph and (2) apply only to the specified flour and wheat-cereal preparations; for sugar beets and sugarcane, they apply only to sugar. (2) When the rate rises, the holder must pay a tax equal to the new applicable rate minus the rate payable or paid immediately before the rise. (3) If the tax is suspended or is to be refunded after the Agriculture Secretary certifies under section 615(a), paragraph (1) applies. (4) If the Agriculture Secretary revokes that certification, paragraph (2) applies. (5) This subsection applies on and after June 1, 1934. (f) This section does not apply to rice.

the actual law source: uscode.house.gov ↗public domain

(a)

Upon the sale or other disposition of any article processed wholly or in chief value from any commodity with respect to which a processing tax is to be levied, that on the date the tax first takes effect or wholly terminates with respect to the commodity, is held for sale or other disposition (including articles in transit) by any person, there shall be made a tax adjustment as follows:

(1)

Whenever the processing tax first takes effect, there shall be levied, assessed, and collected a tax to be paid by such person equivalent to the amount of the processing tax which would be payable with respect to the commodity from which processed if the processing had occurred on such date. Such tax upon articles imported prior to, but in customs custody or control on, the effective date, shall be paid prior to release therefrom. In the case of sugar, the tax on floor stocks, except the retail stocks of persons engaged in retail trade, shall be paid for the month in which the stocks are sold, or used in the manufacture of other articles, under rules and regulations prescribed by the Commissioner of Internal Revenue with the approval of the Secretary of the Treasury.

(2)

Whenever the processing tax is wholly terminated, (A) there shall be refunded or credited in the case of a person holding such stocks with respect to which a tax under this chapter has been paid, or (B) there shall be credited or abated in the case of a person holding such stocks with respect to which a tax under this chapter is payable, where such person is the processor liable for the payment of such tax, or (C) there shall be refunded or credited (but not before the tax has been paid) in the case of a person holding such stocks with respect to which a tax under this chapter is payable, where such person is not the processor liable for the payment of such tax, a sum in an amount equivalent to the processing tax which would have been payable with respect to the commodity from which processed if the processing had occurred on such date: Provided, That in the case of any commodity with respect to which there was any increase, effective prior to June 1, 1934, in the rate of the processing tax, no such refund, credit, or abatement, shall be in an amount which exceeds the equivalent of the initial rate of the processing tax in effect with respect to such commodity.

(b)

The tax imposed by subsection (a) of this section shall not apply to the retail stocks of persons engaged in retail trade, held at the date the processing tax first takes effect; but such retail stocks shall not be deemed to include stocks held in a warehouse on such date, or such portion of other stocks held on such date as are not sold or otherwise disposed of within thirty days thereafter. Except as to flour and prepared flour, and cereal preparations made chiefly from wheat, as classified in Wheat Regulations, Series 1, Supplement 1, and as to any article processed wholly or in chief value from cotton, the tax refund, credit, or abatement provided in subsection (a) of this section shall not apply to the retail stocks of persons engaged in retail trade, nor to any article (except sugar) processed wholly or in chief value from sugar beets, sugarcane, or any product thereof, nor to any article (except flour, prepared flour and cereal preparations made chiefly from wheat, as classified in Wheat Regulations, Series 1, Supplement 1) processed wholly or in chief value from wheat, held on the date the processing tax is wholly terminated.

(c)

(1)

Any sugar, imported prior to the effective date of a processing tax on sugar beets and sugarcane, with respect to which it is established (under regulations prescribed by the Commissioner of Internal Revenue, with the approval of the Secretary of the Treasury) that there was paid at the time of importation a duty at the rate in effect on January 1, 1934, and (2) any sugar held on April 25, 1934, by, or to be delivered under a bona fide contract of sale entered into prior to April 25, 1934, to, any manufacturer or converter, for use in the production of any article (except sugar) and not for ultimate consumption as sugar, and (3) any article (except sugar) processed wholly or in chief value from sugar beets, sugarcane, or any product thereof, shall be exempt from taxation under subsection (a) of this section, but sugar held in customs custody or control on April 25, 1934, shall not be exempt from taxation under subsection (a) of this section, unless the rate of duty paid upon the withdrawal thereof was the rate of duty in effect on January 1, 1934.

(d)

The Secretary of Agriculture is authorized to purchase, out of such proceeds of taxes as are available therefor, during the period this chapter is in effect with respect to sugar beets and sugarcane, not in excess of three hundred thousand tons of sugar raw value from the surplus stocks of direct-consumption sugar produced in the United States beet-sugar area, at a price not in excess of the market price for direct consumption sugar on the date of purchase, and to dispose of such sugar by sale or otherwise, including distribution to any organization for the relief of the unemployed, under such conditions and at such times as will tend to effectuate the declared policy of section 608a of this title. The sugar so purchased shall not be included in the quota for the United States beet-sugar area. All proceeds received by the Secretary of Agriculture, in the exercise of the powers granted, are appropriated to be available to the Secretary of Agriculture for the purposes described in subsections (a) and (b) of section 612 of this title.

(e)

Upon the sale or other disposition of any article processed wholly or in chief value from any commodity with respect to which the existing rate of the processing tax is to be increased, or decreased, that on the date such increase, or decrease, first takes effect with respect to the commodity, is held for sale or other disposition (including articles in transit) by any person, and upon the production of any article from a commodity in process on the date on which the rate of the processing tax is to be increased or decreased, there shall be made a tax adjustment as follows:

(1)

Whenever, on or after June 1, 1934, the rate of the processing tax on the processing of the commodity generally or for any designated use or uses, or as to any designated product or products thereof for any designated use or uses, or as to any class of products, is decreased, there shall be credited or refunded to such person an amount equivalent to the difference between the rate of the processing tax payable or paid at the time immediately preceding the decrease in rate and the rate of the processing tax which would have been payable with respect to the commodity from which processed, if the processing had occurred on such date: Provided, however, That no such credit or refund shall be made in the case of hogs unless the rate of the processing tax immediately preceding said decrease is equal to, or less than, the rate of the processing tax in effect on the date on which any floor stocks tax was paid prior to the adoption of this subsection. In the case of wheat the provisions of this paragraph and of paragraph (2) of this subsection shall apply to flour, prepared flour and cereal preparations made chiefly from wheat, as classified in Wheat Regulations, Series 1, Supplement 1 only; in the case of sugarcane and sugar beets the provisions of this paragraph and of paragraph (2) of this subsection shall apply to sugar only.

(2)

Whenever the rate of the processing tax on the processing of the commodity generally, or for any designated use or uses, or as to any designated product or products thereof for any designated use or uses, or as to any class of products, is increased, there shall be levied, assessed and collected a tax to be paid by such person equivalent to the difference between the rate of the processing tax payable or paid at the time immediately preceding the increase in rate and the rate of the processing tax which would be payable with respect to the commodity from which processed, if the processing had occurred on such date.

(3)

Whenever the processing tax is suspended or is to be refunded pursuant to a certification of the Secretary of Agriculture to the Secretary of the Treasury, under section 615(a) of this title, the provisions of paragraph (1) of this subsection shall become applicable.

(4)

Whenever the Secretary of Agriculture revokes any certification to the Secretary of the Treasury under section 615(a) of this title, the provisions of paragraph (2) of this subsection shall become applicable.

(5)

The provisions of this subsection shall be effective on and after June 1, 1934.

(f)

The provisions of this section shall not be applicable with respect to rice.

Source credit: (May 12, 1933, ch. 25, title I, § 16, 48 Stat. 40; May 9, 1934, ch. 263, §§ 10, 17, 48 Stat. 676, 678; June 26, 1934, ch. 759, § 1, 48 Stat. 1241; Mar. 18, 1935, ch. 32, § 10, 49 Stat. 48; Aug. 24, 1935, ch. 641, §§ 20(b), 25–27, 49 Stat. 768, 769; June 4, 1936, ch. 501, 49 Stat. 1464; June 22, 1936, ch. 690, § 601(a), (c), (g), 49 Stat. 1739, 1740.)

history & why it existsrecord from the source credit

1933Enacted · Act of May 12, 1933, ch. 25 · 48 Stat. 40
1934Amended · Act of May 9, 1934, ch. 263 · 48 Stat. 676, 678
1934Amended · Act of June 26, 1934, ch. 759 · 48 Stat. 1241
1935Amended · Act of Mar. 18, 1935, ch. 32 · 49 Stat. 48
1935Amended · Act of Aug. 24, 1935, ch. 641 · 49 Stat. 768, 769
1936Amended · Act of June 4, 1936, ch. 501 · 49 Stat. 1464
1936Amended · Act of June 22, 1936, ch. 690 · 49 Stat. 1739, 1740

A history note hasn’t been published yet. The record shows enactment by ch. 25 on 1933-05-12.

all 0 arguments · sorted by: best

no arguments yet — make the first case