26 U.S.C. § 4223 | Special rules relating to further manufacture

(a)

Purchasing manufacturer to be treated as the manufacturer

For purposes of this chapter, a manufacturer or producer to whom an article is sold or resold free of tax under section 4221(a)(1) for use by him in further manufacture shall be treated as the manufacturer or producer of such article.

(b)

Computation of tax

If the manufacturer or producer referred to in subsection (a) incurs liability for tax under this chapter on his sale or use of an article referred to in subsection (a) and the tax is based on the price for which the article is sold, the article shall be treated as having been sold by him—

(1)

at the price for which the article was sold by him (or, where the tax is on his use of the article, at the price referred to in section 4218(c)); or

(2)

if he so elects and establishes such price to the satisfaction of the Secretary—

(A)

at the price for which the article was sold to him; or

(B)

at the price for which the article was sold by the person who (without regard to subsection (a)) is the manufacturer, producer, or importer of such article.

For purposes of this subsection, the price for which the article was sold shall be determined as provided in section 4216. For purposes of paragraph (2) no adjustment or readjustment shall be made in such price by reason of any discount, rebate, allowance, return or repossession of a container or covering, or otherwise. An election under paragraph (2) shall be made in the return reporting the tax applicable to the sale or use of the article, and may not be revoked.

Pub. L. 85–859, title I, § 119(a)Sept. 2, 195872 Stat. 1285 Pub. L. 86–418, § 2(b)Apr. 8, 196074 Stat. 38 Pub. L. 94–455, title XIX, § 1906(b)(13)(A)Oct. 4, 197690 Stat. 1834 Pub. L. 98–369, div. A, title VII, § 735(c)(10)July 18, 198498 Stat. 983(Added , , ; amended , , ; , , ; , , .)

Editorial Notes

Prior Provisions

act Aug. 16, 1954, ch. 736 68A Stat. 495 Pub. L. 85–859, § 119(a)section 4225 of this titleA prior section 4223, , , related to exemption of articles manufactured or produced by Indians, prior to repeal by . See .

Amendments

Pub. L. 98–3691984—Subsec. (b)(1). substituted “4218(c)” for “section 4218(e)”.

Pub. L. 94–4551976—Subsec. (b) struck out “or his delegate” after “Secretary”.

Pub. L. 86–4181960—Subsec. (b)(1). substituted “section 4218(e)” for “section 4218(d)”.

Statutory Notes and Related Subsidiaries

Effective Date of 1984 Amendment

Pub. L. 98–369 Pub. L. 97–424 section 736 of Pub. L. 98–369 section 4051 of this titleAmendment by effective, except as otherwise provided, as if included in the provisions of the Highway Revenue Act of 1982, title V of , to which such amendment relates, see , set out as a note under .

Effective Date of 1960 Amendment

Pub. L. 86–418April 8, 1960section 4 of Pub. L. 86–418 section 4221 of this titleAmendment by applicable only with respect to bicycle tires and tubes sold by the manufacturer, producer, or importer thereof on or after the first day of the first month which begins more than 10 days after , see , set out as a note under .