Page:United States Statutes at Large Volume 94 Part 1.djvu/283

 PUBLIC LAW 96-223—APR. 2, 1980

94 STAT. 233

"(4) REFINING BEGUN ON PREMISES.—If the manufacture or conversion of crude oil into refined products begins before such oil is removed from the premises— "(A) such oil shall be treated as removed on the day such manufacture or conversion begins, and "(B) the removal price shall be the constructive sales price for purposes of determining gross income from the property under section 613. 26 USC 613. "(5) MEANING OF TERMS.—The terms 'premises' and 'refined product' have the same meaning as when used for purposes of determining gross income from the property under section 613. "SEC. 4989. ADJUSTED BASE PRICE.

"(a) ADJUSTED BASE PRICE DEFINED.—For purposes of this chapter, the term 'adjusted base price' means the base price for the barrel of crude oil plus an amount equal to— "(1) such base price, multiplied by "(2) the inflation adjustment for the calendar quarter in which the crude oil is removed from the premises. The amount determined under the preceding sentence shall be rounded to the nearest cent. "(b) INFLATION ADJUSTMENT.—

"(1) IN GENERAL.—For purposes of subsection (a), the inflation adjustment for any calendar quarter is the percentage by which— "(A) the implicit price deflator for the gross national product for the second preceding calendar quarter, exceeds "(B) such deflator for the calendar quarter ending June 30, 1979. "(2) ADDITIONAL ADJUSTMENT FOR TIER 3 OIL.—The adjusted

base price for tier 3 oil shall be determined by substituting for the implicit price deflator referred to in paragraph (1)(A) an amount equal to such deflator multiplied by 1.005 to the nth power where 'n equals the number of calendar quarters beginning after September 1979 and before the calendar quarter in which the oil is removed from the premises. "(3) FIRST REVISION OF PRICE DEFLATOR USED.—For purposes of

paragraphs (1) and (2), the first revision of the price deflator shall be used. "(c) BASE PRICE FOR TIER 1 OIL.—For purposes of this chapter, the base price for tier 1 oil is— "(1) the ceiling price which would have applied to such oil under the March 1979 energy regulations if it had been produced and sold in May 1979 as upper tier oil, reduced by "(2) 21 cents. "(d) BASE PRICES FOR TIER 2 OIL AND TIER 3 OIL.—For purposes of

this chapter— "(1) GENERAL RULE.—Except as provided in paragraph (2), the base prices for tier 2 oil and tier 3 oil shall be prices determined pursuant to the method prescribed by the Secretary by regulations. Any method so prescribed shall be designed so as to yield, with respect to oil of any grade, quality, and field, a base price which approximates the price at which such oil would have sold in December 1979 if— "(A) all domestic crude oil were uncontrolled, and "(B) the average removal price for all domestic crude oil (other than Sadlerochit oil) were—

26 USC 4989.

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