REMOVAL OF TAX-EXEMPT TOBACCO PRODUCTS FOR USE AS SUPPLIES
ON UNITED STATES NAVY VESSELS
Proprietors of Export Warehouses,
Manufacturers of Tobacco Products
and Others Concerned:
Purpose. This circular is to advise industry members that an ATF
Procedure will be published in an early issue of the ATF Bulletin. The
procedure will read substantially as follows:
Background. 26 U.S.C. 5704 provides that manufacturers
of tobacco products and proprietors of export warehouses may
remove tobacco articles, without payment of tax, for consumption beyond the jurisdiction of the internal revenue
laws of the United States. Regulations in 26 CFR 290.64,
290.195, and 290.206 provide that manufacturers of tobacco
products and proprietors of export warehouses are responsible for delivery of tax-exempt tobacco products to United
States Navy vessels and are liable for the tax on tobacco
products until they furnish to the Regional Director,
Bureau of Alcohol, Tobacco and Firearms, satisfactory
evidence of proper delivery.
The Department of the Navy procurement procedures
provide that United States Navy vessels may procure taxexempt tobacco products only when under orders to proceed
beyond the jurisdiction of the internal revenue laws of
the United States (3-mile limit) and that the Navy procurement document must contain a certificate to that
effect, signed by the Commanding Officer.
Recently the Navy proposed that supply officers
aboard some of the larger Naval vessels be authorized
to execute this exemption certificate as well as the
Commanding Officer.
New Procedure. Consistent with this change in Navy
procurement authority, proprietors, may in the future
accept certification of the Commanding Officer or the
supply officer for procurement of tax-exempt tobacco
products for the following classes of U.S. Naval vessels:
Class of Vessel |
Code Designation |
Guided Missile Cruisers (nuclear propulsion) |
CGN |
Guided Missile Light Cruisers |
CLG |
Amphibious Transport Docks |
LPD |
Amphibious Assault Ships |
LPH |
Attack Aircraft Carriers |
CVA |
Attack Aircraft Carriers (nuclear propulsion) |
CVAN |
Submarine Tenders |
AS |
Guided Missile Frigates |
DLG |
Guided Missile Frigates (nuclear propulsion) |
DLGN |
Fast Combat Support Ships |
AOE |
Replenishment Ships |
AOR |
Training Aircraft Carriers |
CVT |
Amphibious Assault Ships |
LHA |
Combat Stores Ships |
AFS |
Store Ships |
AF |
Amphibious Command Ships |
LCC |
Destroyer Tenders |
AD |
Hospital Ships |
AH |
Heavy Cruisers |
CA |
Cruisers, Guided Missile |
CG |
Auxiliary Repair Ships |
AR |
Amphibious Transport Ships |
LPA |
Repair Ships |
AR |
|
|
For all other classes of vessels only the Commanding
Officer's certification is acceptable as a basis for your
delivery of tax-exempt tobacco products. The proper
certification is as follows:
These tobacco products will be held as sea
stores for issue and consumption outside
the three-mile limits of the United States.
_____________________________________
Commanding Officer
(or Supply Officer
of a vessel listed above)
Retention of Procurement Documents. You should
retain procurement documents as part of your records
to evidence the propriety of the removal and to permit
later verification by officers of the Bureau.
Inquiries. Inquiries concerning this circular should refer to
its number and be addressed to the office of the appropriate
Regional Director, Bureau of Alcohol, Tobacco and Firearms.
REX D. DAVIS
Director |