Eligibility
Applies to manufacturers or retailers who have paid excise taxes on articles that are subsequently exported, sold to state/local governments, or where the price was lowered via a bona fide discount or rebate.
Frequently Asked Questions
Who is eligible for the Excise Tax Price Readjustments and Export Credits?
Applies to manufacturers or retailers who have paid excise taxes on articles that are subsequently exported, sold to state/local governments, or where the price was lowered via a bona fide discount or rebate.
How does the Excise Tax Price Readjustments and Export Credits work?
Allows for a credit or refund of manufacturers or retail excise taxes when the price is readjusted (rebates/discounts) or the article is exported.
What law authorizes the Excise Tax Price Readjustments and Export Credits?
The Excise Tax Price Readjustments and Export Credits is authorized under IRC §6416 of the Internal Revenue Code (Title 26, United States Code).
Statutory Text — IRC §6416
Source: Internal Revenue Code, Title 26, United States Code
§ 6416. Certain taxes on sales and services(a) Condition to allowance(1) General ruleNo credit or refund of any overpayment of tax imposed by chapter 31 (relating to retail excise taxes), or chapter 32 (manufacturers taxes), shall be allowed or made unless the person who paid the tax establishes, under regulations prescribed by the Secretary, that he—(A) has not included the tax in the price of the article with respect to which it was imposed and has not collected the amount of the tax from the person who purchased such article;
(B) has repaid the amount of the tax to the ultimate purchaser of the article;
(C) in the case of an overpayment under subsection (b)(2) of this section—(i) has repaid or agreed to repay the amount of the tax to the ultimate vendor of the article, or
(ii) has obtained the written consent of such ultimate vendor to the allowance of the credit or the making of the refund; or
(D) has filed with the Secretary the written consent of the person referred to in subparagraph (B) to the allowance of the credit or the making of the refund.
(2) ExceptionsThis subsection shall not apply to—(A) the tax imposed by section 4041 (relating to tax on special fuels) on the use of any liquid, and
(B) an overpayment of tax under paragraph (1), (3)(A), (4), (5), or (6) of subsection (b) of this section.
(3) Special ruleFor purposes of this subsection, in any case in which the Secretary determines that an article is not taxable, the term “ultimate purchaser” (when used in paragraph (1)(B) of this subsection) includes a wholesaler, jobber, distributor, or retailer who, on the 15th day after the date of such determination, holds such article for sale; but only if claim for credit or refund by reason of this paragraph is filed on or before the date for filing the return with respect to the taxes imposed under chapter 32 for the first period which begins more than 60 days after the date on such determination.
(4) Registered ultimate vendor or credit card issuer to administer credits and refunds of gasoline tax(A) In generalFor purposes of this subsection, except as provided in subparagraph (B), if an ultimate vendor purchases any gasoline on which tax imposed by section 4081 has been paid and sells such gasoline to an ultimate purchaser described in subparagraph (C) or (D) of subsection (b)(2) (and such gasoline is for a use described in such subparagraph), such ultimate vendor shall be treated as the person (and the only person) who paid such tax, but only if such ultimate vendor is registered under section 4101.
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