Rev. Rul. 61-176

Advice has been requested whether the manufacturers excise tax on certain business machines, imposed by section 4191 of the Internal Revenue Code of 1954, applies to sales by the manufacturer of the stencil dispensing machine described below.

The stencil dispensing machine is similar to a tape dispensing machine in design and operation. It is used to dispense a so-called `tab-on' stencil, which is a combination of tape and stencil material with a carbon backing. This material is contained in the machine in roll form. By manually pressing a lever, the machine feeds out a predetermined length of tape and stencil material and cuts it to the desired length. The material is then tabbed onto a business form, such as a bill of lading or shipping order, over the `ship to' address area to permit the user to cut the stencil as a by-product of the form writing operation. The machine is primarily used in the shipping operations and shipping departments of industries that require multiple addressing on their individual shipments.

Section 4191 of the Code imposes a tax upon the sale by the manufacturer, producer, or importer of certain enumerated business machines.

Stencil dispensing machines are not specifically included in the list of business machines enumerated in section 4191 of the Code, nor do they come within the general classification of any of the articles which are enumerated in that section. Accordingly, it is held that sales by the manufacturer, producer, or importer of the stencil dispensing machine described above are not subject to the manufacturers excise tax imposed by section 4191 of the Code.