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PUBLIC LAW 85-859-SEPT. 2, 1958

[72 S T A T.

of internal revenue law, are independent of each other and neither has a proprietary interest, directly or indirectly, in the business of the other, and all persons liable for the tax under subsection (a) or (b), or under any similar prior provisions of internal revenue law, have divested themselves of all interest in the spirits so withdrawn. "(2) RELIEF FROM LIABILITY.—All persons liable for the tax

on distilled spirits under paragraph (1) of this subsection^ or under subsection (a) or (b), or under any similar prior provisions of internal revenue law, shall be relieved of any such liability at the time, as the case may be, the distilled spirits are exported, deposited in a foreign-trade zone, used in the production of wine, deposited in customs manufacturing bonded warehouses, or laden as supplies upon, or used in the maintenance or repair of, certain vessels or aircraft, as provided by law. " (f) CROSS REFERENCES.— "(1) For provisions conditioning warehousing bonds on the payment of the tax, see section 5173(c). "(2) For provisions relating to transfer of tax liability to redistiller in case of redistillation, see section 5223. "(3) For liability for tax on denatured distilled spirits, articles, and volatile fruit-flavor concentrates, see section 5001(a)(6) and (7). "(4) For liability for tax on distilled spirits withdrawn free of tax, see section 5001(a)(5). "(5) For liability of wine producer for unlawfully using wine spirits withdrawn for the production of wine, see section 5391. "SEC. 5006. DETERMINATION OF TAX. " (a) REQUIREMENTS.—

"(1) GENERAL.—Except as otherwise provided in this section, the internal revenue tax on distilled spirits shall be determined when the spirits are withdrawn from bond. Such tax shall be determined by such means as the Secretary or his delegate shall by . regulations prescribe, and with the use of such devices and apparatus (including but not limited to storage, gauging, and bottling tanks and pipelines) as the Secretary or his delegate may require. The tax on distilled spirits withdrawn from the bonded premises of a distilled spirits plant shall be determined upon completion of the gauge for determination of tax and before withdrawal from bonded premises, under such regulations as the Secretary or his delegate shall prescribe. "(2)

D I S TITLE D S P I R I T S ENTERED FOR STORAGE.—

" (A) BONDING PERIOD LIMITATION.—Except as provided in

subparagraph (B), the tax on distilled spirits entered for deposit in storage in internal revenue bond shall be determined within 20 years from the date of original entry for deposit in such storage. " (B) EXCEPTIONS.—Subparagraph (A) and section 5173 (c)(1)(A) shall not apply in the case of— "(i) distilled spirits of 190 degrees or more of proof; "(ii) denatured distilled spirits; or "(iii) distilled spirits which on July 26, 1936, were 8 years of age or older and which were in bonded warehouses on that date. "(C)

DISTILLED SPIRITS MINGLED I N INTERNAL REVENUE

BOND.—In applying subparagraph (A) and section 5173(c) (1)(A) to distilled spirits entered for deposit in storage on different dates and lawfully mingled in internal revenue bond, the Secretary or his delegate shall, b ^ regulations, provide for the application of the 20-year period to such spirits in such manner that no more spirits will remain in bond

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