Page:United States Statutes at Large Volume 68A.djvu/534

 494

.INTERNAL REVENUE CODE OF 1954

SEC. 4217. LEASE CONSIDERED AS SALE. For the purposes of this chapter, the lease of an article (including any renewal or any extension of a lease or any subsequent lease of such article) by the manufacturer, producer, or importer shall be considered a taxable sale of such article. SEC. 4218. USE BY MANUFACTURER OR IMPORTER CONSIDERED SALE. (a) GENERAL RULE. — I f —

(1) any person manufactures, produces, or imports an article (other than a tire, inner tube, or automobile radio or television receiving set taxable under section 4141 and uses it (otherwise than as material in the manufacture or production of, or as a component part of, another article to be manufactured or produced by him which will be taxable under this chapter or sold free of tax by virtue of section 4220 or 4224, relating to tax-free sales), or (2) any person manufactures, produces, or imports a tire, inner tube, or automobile radio or television receiving set taxable under section 4141 and sells it on or in connection with, or with the sale of, an article taxable under section 4061, relating to the tax on automobiles, or uses it, he shall be liable for tax under this chapter in the same manner as if such article was sold by him, and the tax (if based on the price for which the article is sold) shall be computed on the price at which such or similar articles are sold, in the ordinary course of trade, by manufacturers, producers, or importers thereof, as determined by the Secretary or his delegate. (b) EXCEPTION.—This section shall not apply with respect to the use by the manufacturer, producer, or importer of articles described in section 4141 if such articles are used by him as material in the manufacture or production of, or as a component part of, communication, detection, or navigation receivers of the type used in commercial, military, or marine installations if such receivers are to be sold to the United States for its exclusive use. SEC. 4219. APPLICATION OF TAX IN CASE OF SALES BY OTHER THAN MANUFACTURER OR IMPORTER. I n case any person acquires from the manufacturer, producer, or importer of an article, by operation of law or as a result of any transaction not taxable under this chapter, the right to sell such article, the sale of such article by such person shall be taxable under this chapter as if made by the manufacturer, producer, or importer, and such person shall be liable for the tax. SEC. 4220. EXEMPTION FOR SALES OR RESALES TO MANUFACTURERS. Under regulations prescribed by the Secretary or his delegate, no tax under this chapter shall be imposed with respect to the sale of any article— (1) for use by the vendee as material in the manufacture or production of, or as a component part of, an article enumerated in this chapter; (2) for resale by the vendee for such use by his vendee, if such article is in due course so resold. For the purposes of this chapter, the manufacturer or producer to whom an article is sold under paragraph (1) or resold under paragraph (2) shall be considered the manufacturer or producer of such §4217

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