Rev. Rul. 61-148

Advice has been requested whether a certain lubricant for jet engines is considered to be a lubricating oil for purposes of the manufacturers excise tax.

A company produces and sells a product which it refers to as a lubricant for jet engines. This product is synthetically produced from various chemicals in order to impart certain desirable properties. It has been established that the product is a synthetic material having the physical properties of oil, including lubricity.

Section 4091 of the Internal Revenue Code of 1954 imposes a tax on lubricating oils sold by the manufacturer or producer thereof.

Section 48.4091-2(a) of the Manufacturers and Retailers Excise Tax Regulations provides that the term `lubricating oils' includes all oils, regardless of origin, which are suitable for use as a lubricant, or sold for use as a lubricant. The term does not include synthetic materials which possess lubricating properties, nor does it ordinarily include products of the type commonly known as grease.

Since section 48.4091-2(a) of the regulations provides that the term `lubricating oils' does not include synthetic materials which possess lubricating properties, the product described above is not considered to be a lubricating oil within the meaning of that section.

Accordingly, it is held that the company's sales of this particular product are not subject to the manufacturers excise tax on lubricating oils imposed by section 4091 of the Code.