INTERIM PROCEDURES FOR ADMINISTRATION OF
PUBLIC LAW 88-342, ENACTED JUNE 30, 1964
Manufacturers of tobacco products
and cigarette papers and tubes:
Purpose. This is to advise you of the enactment of Public Law 88-342, an
act to prevent double taxation in the case of certain tobacco products
and cigarette papers and tubes exported from and returned unchanged to
the United States for delivery to a manufacturer's bonded factory, and
to advise you also about the procedures for administration of the law
until implementing regulations are issued.
Background. On June 30, 1964, H. R. 8268 was enacted into law, as
Public Law 88-342. It amends headnote 2 to subpart A of part 1 of schedule
8 of the tariff schedules and section 5704 of the Internal Revenue Code of
1954. Under the amendments, domestically produced tobacco products and
cigarette papers and tubes previously exported from and returned to the
United States may be released from customs custody without payment of the
duty attributable to the internal revenue tax, for delivery to a manufacturer of such articles in accordance with such regulations and under such
bond as the Secretary of the Treasury or his delegate shall prescribe.
The law became effective on July 1, 1964.
Procedures for release from customs custody. Domestically produced tobacco
products exported from and returned to the United States may be released
from customs custody, without payment of that part of the duty attributable
to the internal revenue tax, for delivery to the factory of a manufacturer
of tobacco products under the bond of such manufacturer. Domestically
produced cigarette papers and tubes exported from and returned to the
United States may be released from customs custody, without payment of
that part of the duty attributable to the internal revenue tax, for
delivery, under the bond of the manufacturer to whom such articles are
released, to the factory of (a) a manufacturer of cigarette papers and
tubes; or (b) a manufacturer of tobacco products solely for use in the
manufacture of cigarettes; or (c) in the case of cigarette papers only,
a manufacturer of tobacco products to be put up by him in units of
not more than 25 papers each for distribution with packages of
manufactured tobacco. To obtain release of these articles from
customs custody, you will follow the procedures set forth in
26 CFR 275.86, using Form 2145. Upon such release such articles will
be subject to Chapter 52 of the Internal Revenue Code as if they had
not been exported or otherwise removed from internal revenue bond.
Such articles received into the factory of a manufacturer will, of
course, be subject to the provisions of Part 270, Manufacture of
Tobacco Products, or Part 285, Manufacture of Cigarette Papers and
Tubes, as applicable.
Inquiries. Inquiries in regard to this industry circular should refer
to its number and be addressed to the office of your assistant regional
commissioner (alcohol and tobacco tax).
Harold A. Serr
Acting Director, Alcohol and Tobacco Tax Division