Rev. Rul. 54-415

Advice is requested whether refund is allowable under section 3494 of the Internal Revenue Code of 1939 of tax paid under section 3500 of the Code on sugar imported for use in the production of livestock feed.

Section 3490(a) of the Code provides that there shall be levied, collected and paid a tax, to be paid by the manufacturer, upon manufactured sugar manufactured in the United States.

Section 3494(a) of the Code provides that upon the use of any manufactured sugar, or article manufactured therefrom, as livestock feed, or in the production of livestock feed, there shall be paid by the Commissioner to the person so using such manufactured sugar, or article manufactured therefrom, the amount of any tax paid under section 3490 of the Code with respect thereto.

Section 3500 of the Code provides that in addition to any other tax or duty imposed by law, there shall be imposed a tax upon manufactured sugar, or articles composed in chief value of manufactured sugar, imported or brought into the United States.

The provisions of section 3494 of the Internal Revenue Code, relating to the refund of tax paid with respect to manufactured sugar used as livestock feed, or in the production of livestock feed, are applicable only to tax paid under section 3490 of the Code, with respect to manufactured sugar manufactured in the United States. Accordingly, no refund is allowable under section 3494 of the Code of tax paid under section 3500 of the Code with respect to sugar imported for use in the production of livestock feed.

When sugar, whether raw or refined, is imported into the United States, a declaration must be made as to whether it is being imported for the purpose of being further refined, or for some other purpose. If it is being imported for any purpose other than to be further refined as, for example, for use in the production of livestock feed, it is subject to the tax imposed by section 3500 of the Code, which tax is collected by the Bureau of Customs.