Internal Revenue Code:Sec. 5051. Imposition and rate of tax

From TaxAlmanac

Location in Internal Revenue Code

     TITLE 26 - INTERNAL REVENUE CODE
      Subtitle E - Alcohol, Tobacco, and Certain Other Excise Taxes
       CHAPTER 51 - DISTILLED SPIRITS, WINES, AND BEER
        Subchapter A - Gallonage and Occupational Taxes
         PART I - GALLONAGE TAXES
          Subpart D - Beer
        

Statute

    Sec. 5051. Imposition and rate of tax
 
    (a) Rate of tax
      (1) In general
        A tax is hereby imposed on all beer brewed or produced, and
      removed for consumption or sale, within the United States, or
      imported into the United States. Except as provided in paragraph
      (2), the rate of such tax shall be $18 for every barrel
      containing not more than 31 gallons and at a like rate for any
      other quantity or for fractional parts of a barrel.
      (2) Reduced rate for certain domestic production
        (A) $7 a barrel rate
          In the case of a brewer who produces not more than 2,000,000
        barrels of beer during the calendar year, the per barrel rate
        of the tax imposed by this section shall be $7 on the first
        60,000 barrels of beer which are removed in such year for
        consumption or sale and which have been brewed or produced by
        such brewer at qualified breweries in the United States.
        (B) Controlled groups
          In the case of a controlled group, the 2,000,000 barrel
        quantity specified in subparagraph (A) shall be applied to the
        controlled group, and the 60,000 barrel quantity specified in
        subparagraph (A) shall be apportioned among the brewers who are
        component members of such group in such manner as the Secretary
        or his delegate shall by regulations prescribed.  For purposes
        of the preceding sentence, the term ''controlled group'' has
        the meaning assigned to it by subsection (a) of section 1563,
        except that for such purposes the phrase ''more than 50
        percent'' shall be substituted for the phrase ''at least 80
        percent'' in each place it appears in such subsection.  Under
        regulations prescribed by the Secretary or his delegate,
        principles similar to the principles of the preceding two
        sentences shall be applied to a group of brewers under common
        control where one or more of the brewers is not a corporation.
        (C) Regulations
          The Secretary may prescribe such regulations as may be
        necessary to prevent the reduced rates provided in this
        paragraph from benefiting any person who produces more than
        2,000,000 barrels of beer during a calendar year.
      (3) Tolerances
        Where the Secretary or his delegate finds that the revenue will
      not be endangered thereby, he may by regulations prescribe
      tolerances for barrels and fractional parts of barrels, and, if
      such tolerances are prescribed, no assessment shall be made and
      no tax shall be collected for any excess in any case where the
      contents of a barrel or a fractional part of a barrel are within
      the limit of the applicable tolerance prescribed.
    (b) Assessment on materials used in production in case of fraud
      Nothing contained in this subpart or subchapter G shall be
    construed to authorize an assessment on the quantity of materials
    used in producing or purchased for the purpose of producing beer,
    nor shall the quantity of materials so used or purchased be
    evidence, for the purpose of taxation, of the quantity of beer
    produced; but the tax on all beer shall be paid as provided in
    section 5054, and not otherwise; except that this subsection shall
    not apply to cases of fraud, and nothing in this subsection shall
    have the effect to change the rules of law respecting evidence in
    any prosecution or suit.
    (c) Illegally produced beer
      The production of any beer at any place in the United States
    shall be subject to tax at the rate prescribed in subsection (a)
    and such tax shall be due and payable as provided in section
    5054(a)(3) unless -
        (1) such beer is produced in a brewery qualified under the
      provisions of subchapter G, or
        (2) such production is exempt from tax under section 5053(e)
      (relating to beer for personal or family use).
 

Sources

    (Added Pub. L. 85-859, title II, Sec. 201, Sept. 2, 1958, 72 Stat.
    1333; amended Pub. L. 86-75, Sec. 3(a)(6), June 30, 1959, 73 Stat.
    157; Pub. L. 86-564, title II, Sec. 202(a)(8), June 30, 1960, 74
    Stat. 290; Pub. L. 87-72, Sec. 3(a)(8), June 30, 1961, 75 Stat.
    193; Pub. L. 87-508, Sec. 3(a)(7), June 28, 1962, 76 Stat. 114;
    Pub. L. 88-52, Sec. 3(a)(8), June 29, 1963, 77 Stat. 72; Pub. L.
    88-348, Sec. 2(a)(8), June 30, 1964, 78 Stat. 237; Pub. L. 89-44,
    title V, Sec. 501(d), June 21, 1965, 79 Stat. 150; Pub. L. 94-529,
    Sec. 1, Oct. 17, 1976, 90 Stat. 2485; Pub. L. 95-458, Sec.
    2(b)(2)(A), Oct. 14, 1978, 92 Stat. 1256; Pub. L. 101-508, title
    XI, Sec. 11201(c), Nov. 5, 1990, 104 Stat. 1388-416.)
 

Miscellaneous

                              PRIOR PROVISIONS
      A prior section 5051, act Aug. 16, 1954, ch. 736, 68A Stat. 611,
    as amended by acts Mar. 30, 1955, ch. 18, Sec. 3(a)(8), 69 Stat.
    14; Mar. 29, 1956, ch. 115, Sec. 3(a)(8), 70 Stat. 66; Mar. 29,
    1957, Pub. L. 85-12, Sec. 3(a)(6), 71 Stat. 9; June 30, 1958, Pub.
    L. 85-475, Sec. 3(a)(6), 72 Stat. 259, consisted of provisions
    similar to those comprising this section, prior to the general
    revision of this chapter by Pub. L. 85-859.
                                 AMENDMENTS
      1990 - Subsec. (a)(1). Pub. L. 101-508, Sec. 11201(c)(1),
    substituted ''$18'' for ''$9''.
      Subsec. (a)(2)(C). Pub. L. 101-508, Sec. 11201(c)(2), added
    subpar. (C).
      1978 - Subsec. (c). Pub. L. 95-458 added subsec. (c).
      1976 - Subsec. (a). Pub. L. 94-529 reduced the excise tax on beer
    for small brewers to $7 per barrel on the first 60,000 barrels
    produced in the United States and removed for sale or consumption
    or sale during the calendar year, the reduced rate to be applicable
    only to brewers producing no more than 2 million barrels of beer in
    a calendar year, and inserted provision that if several brewers are
    members of a controlled group, the 2-million barrel limit is to be
    applied to the controlled group and the 60,000-barrel limit is to
    be apportioned among the members of the controlled group in
    accordance with Treasury Department regulations promulgated by the
    Secretary or his delegate.
      1965 - Subsec. (a). Pub. L. 89-44 struck out sentence providing
    for the imposition on and after July 1, 1965, of a tax of $8 in
    lieu of the tax imposed by the section.
      1964 - Subsec. (a). Pub. L. 88-348 substituted ''July 1, 1965''
    for ''July 1, 1964''.
      1963 - Subsec. (a). Pub. L. 88-52 substituted ''July 1, 1964''
    for ''July 1, 1963''.
      1962 - Subsec. (a). Pub. L. 87-508 substituted ''July 1, 1963''
    for ''July 1, 1962''.
      1961 - Subsec. (a). Pub. L. 87-72 substituted ''July 1, 1962''
    for ''July 1, 1961''.
      1960 - Subsec. (a). Pub. L. 86-564 substituted ''July 1, 1961''
    for ''July 1, 1960''.
      1959 - Subsec. (a). Pub. L. 86-75 substituted ''July 1, 1960''
    for ''July 1, 1959''.
                      EFFECTIVE DATE OF 1990 AMENDMENT
      Amendment by Pub. L. 101-508 effective Jan. 1, 1991, see section
    11201(d) of Pub. L. 101-508, set out as a note under section 5001
    of this title.
                      EFFECTIVE DATE OF 1978 AMENDMENT
      Amendment by Pub. L. 95-458 effective on first day of first
    calendar month beginning more than 90 days after Oct. 14, 1978, see
    section 2(c) of Pub. L. 95-458, set out as a note under section
    5042 of this title.
                      EFFECTIVE DATE OF 1976 AMENDMENT
      Section 2 of Pub. L. 94-529 provided that: ''The amendment made
    by the first section of this Act (amending this section) shall take
    effect on the first day of the first calendar year which begins
    after the date of the enactment of this Act (Oct. 17, 1976).''
                      EFFECTIVE DATE OF 1965 AMENDMENT
      Amendment by Pub. L. 89-44 applicable on and after July 1, 1965,
    see section 701(d) of Pub. L. 89-44, set out as a note under
    section 5701 of this title.
                               EFFECTIVE DATE
      Section effective July 1, 1959, see section 210(a)(1) of Pub. L.
    85-859, set out as a note under section 5001 of this title.
          FLOOR STOCKS TAXES ON DISTILLED SPIRITS, WINE, AND BEER
      Imposition of tax on beer, exception for small domestic
    producers, exception for certain small wholesale or retail dealers,
    credit against tax, liability for tax and method of payment,
    controlled groups, other laws applicable, and definitions, see
    section 11201(e) of Pub. L. 101-508, set out as a note under
    section 5001 of this title.
 

References

                   SECTION REFERRED TO IN OTHER SECTIONS
      This section is referred to in sections 5041, 5054, 5061, 5671 of
    this title.