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PUBLIC LAW 86-418-APR. 8, 1960
[74 ST A T.
Public Law 86-418 April 8, 1960 [H. R. 8318]
Taxes, B i c y c l e tires and tubes. 72 Stat. 1283. 36 USC 4221.
AN ACT To amend the Internal Revenue Code of 1054 to exempt bicycle tires and tubes used in the manufacture or production of new bicycles from the manufacturers excise tax on tires and tubes. Be it enacted by the Senate and IIouHe of RemeHentatimH of the United States of America in Congre«ft aasembled^ That section 4221(e) of the Internal Revenue C^ode of 1954 (special miles relating to certain tax-free sales) is amended by adding at the end thereof the following new paragraph: " (4) BICYCLE TIRES OR TUBES SOLD TO BICYCUJ MANUFACTURER.—
26 USC 4071.
26 USC 4218.
26 USC 4223.
26 USC 6416.
" (A) IN GENERAL.—Under regulations prescribed by the Secretary or his delegate, no tax shall be imposed under section 4071 on the sale of a bicycle tire (or an inner tube for such a tire) by the manufacturer thereof if such tire or tube is sold for use by the purchaser as material in the manufacture or production of, or as a component part of, a bicycle (other than a rebuilt or reconditioned bicycle). " (B) BICYCLE TIRE DEFINED.—As used in this paragraph the term 'bicycle tire* means a tire, composed of loibber in combination with fabric or other reinforcing element, which is not more than 28 inches in outer diameter and not more than 21/4 inches in cross section and which is primarily designed or adapted for use on bicycles. " (C) PROOF.—Where a bicycle tire or tube has been sold free of tax under this paragraph, this paragraph shall cease to apply unless, within the 6-month period whicn begins on the date of the sale by him (or, if earlier, on the date of shipment by him), the manufacturer of such bicycle tire or tube receives proof that the tire or tube has been used in the manner described in subparagraph (A). " SEC. 2. (a) Section 4218 of the Internal Revenue Code of 1954 (relating to use by manufacturer or importer considered sale) is amended— (1) by striking out "subsection (b) or (c) " in subsection (a) and inserting in lieu thereof "subsection (b), (c), or (d) "; (2) by striking out "If any" in subsection (b) and inserting in lieu thereof "Except as provided in subsection (d), if any"; and (3) by redesignating subsection (d) as subsection (e) and inserting after subsection (c) the following new subsection: " (d) BICYCLE T I R ^ S AND TUBES.—If any person manufactures, produces, or imports a bicycle tire (as defined in section 4221(e)(4)(B)) or an inner tube for such a tire, and uses it (otherwise than as material in the manufacture or production of, or as a component part of, a bicycle, other than a rebuilt or reconditioned bicycle, to be manufactured or produced by him), then he shall be liable for tax under this chapter in the same manner as if such article were sold by him." (b) Section 4223(b)(1) of such Code (relating to computation of tax in the case of further manufacture) is amended by striking out "section 4218(d)" and inserting in lieu thereof "section 4218(e)"'. SEC. 3. (a) Paragraph (2)(E) of section 6416(b) of the Internal Revenue Code (relating to special cases in which taxpayments are considered overpayments) is amended by striking out "subparagraph (A) or (B) " and inserting in lieu thereof "subparagraph (A), (B), or(E)".
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