Rev. Rul. 58-312

Advice has been requested whether the manufacturers excise tax on sporting goods applies to sales by the manufacturer of simulated golf sets designed for use primarily in confined areas.

A company manufacturer's so-called `golf sets' which consist of clubs made in the shape of and resembling golf clubs, plastic cups, and plastic balls. The clubs are 35 inches in length, weigh approximately seven ounces, and are constructed of plastic heads affixed to wooden shafts. The clubs resemble `No. 8' irons, `No. 3' woods, and putters, and are suitable for use only with the plastic balls furnished or with lightweight balls made of sponge rubber or some similar material. The plastic heads of the clubs are not of sufficient strength to be used with regulations of golf balls and would crack or shatter if they were so used. The plastic cups are designed to be interested in the ground and utilized as hole cups so that a game similar to golf may be played. The clubs will drive balls of the type supplied with the set approximately 60 feet.

Section 4161 of the Internal Revenue Code of 1954 imposes a tax on the sales by the manufacturer, producer, or importer of certain sportings goods, includings golf bags (measuring 26 inches or more in length), balls, and clubs (measuring 30 inches or more in length). In construing the law, it is the position of the Internal Revenue Service that the golf equipment taxed under this section includes equipment constructed for use in playing the conventional game of golf, since this is the context in which the term `golf' is employed.

It is held that the balls and clubs described in the instant case are not designed or constructed for use in a conventional game of golf, but can be used only to play a game which in some aspects merely simulates golf. In spite of their outward resemblance to the articles used in golf, such balls and clubs are not considered golf balls and clubs within the meaning of the statute. Therefore, sales by the manufacturer of the balls and clubs contained in the sets described above are not subject to the manufacturers excise tax on sporting goods.