[Code of Federal Regulations]
[Title 27, Volume 1]
[Revised as of April 1, 2005]
From the U.S. Government Printing Office via GPO Access
[CITE: 27CFR26.31]

[Page 692]
 
            TITLE 27--ALCOHOL, TOBACCO PRODUCTS AND FIREARMS
 
 CHAPTER I--ALCOHOL AND TOBACCO TAX AND TRADE BUREAU, DEPARTMENT OF THE 
                                TREASURY
 
PART 26_LIQUORS AND ARTICLES FROM PUERTO RICO AND THE VIRGIN ISLANDS
--Table of Contents
 
  Subpart Ca_Rum Imported Into the United States From Areas Other Than 
                   Puerto Rico and the Virgin Islands
 
Sec. 26.31  Formula.

    (a) The amount of excise taxes collected on rum that is imported 
into the United States from areas other than Puerto Rico and the Virgin 
Islands shall be deposited into the Treasuries of Puerto Rico and the 
Virgin Islands at the rate prescribed in 26 U.S.C. 7652(f). The 
distribution of such amount between Puerto Rico and the Virgin Islands 
shall be computed by using a permanent base percentage, which represents 
the excise taxes collected on rum brought into the United States from 
Puerto Rico and the Virgin Islands during fiscal year 1983. This base 
percentage is 87.626889 percent for Puerto Rico and 12.373111 percent 
for the Virgin Islands. The formula shall be as follows:
    (1) Multiply the total excise taxes collected on rum brought into 
the United States (including rum from Puerto Rico and the Virgin 
Islands) during the previous fiscal year (October 1-September 30) by the 
base percentages to determine the relative shares of the entire U.S. rum 
market that will be allotted to Puerto Rico and the Virgin Islands;
    (2) Subtract each of these shares from the excise taxes collected on 
rum transported to the United States from Puerto Rico and the Virgin 
Islands, respectively, during the previous fiscal year to determine each 
possession's loss or gain in relation to the previous fiscal year's U.S. 
rum market. Divide these results by the excise taxes collected on rum 
imported during the previous fiscal year from areas other than Puerto 
Rico and the Virgin Islands.
    (b) Notwithstanding the formula prescribed in paragraph (a) above, 
the Virgin Islands' share of the excise taxes on rum imported into the 
United States from areas other than Puerto Rico and the Virgin Islands 
shall not exceed 49 percent nor drop below 12.373111 percent. Puerto 
Rico's share of the excise taxes on rum imported into the United States 
from areas other than Puerto Rico and the Virgin Islands shall not 
exceed 87.626889 percent nor drop below 51 percent.
    (c) The percentage for the distribution of the excise taxes 
collected on rum imported into the United States from areas other than 
Puerto Rico and the Virgin Islands, that will be paid over to the 
Treasuries of Puerto Rico and the Virgin Islands, shall be effective on 
March 1 of each year, and shall remain in effect until March 1 of the 
following year.
    (d) The method for transferring the excise tax collections on rum 
imported from areas other than Puerto Rico and the Virgin Islands, into 
the Treasuries of Puerto Rico and the Virgin Islands shall be the same 
as the method used for transferring excise taxes into the Treasury of 
Puerto Rico on distilled spirits (with an alcohol content of at least 92 
percent rum) brought into the United States from Puerto Rico.
    (e) The formula prescribed in this section shall take effect on 
March 1, 1987. Prior to that date, Puerto Rico shall continue to receive 
86.4 percent of the eligible excise taxes on rum imported from areas 
other than Puerto Rico and the Virgin Islands. The Virgin Islands shall 
continue to receive 13.6 percent of these eligible excise taxes until 
March 1, 1987.

(Aug. 16, 1954, Chapter 736, 68A Stat. 907, as amended (26 U.S.C. 7652))

[T.D. ATF-233, 51 FR 28078, Aug. 5, 1986; 52 FR 2222, Jan. 21, 1987]