PUBLIC LAW 96-598—DEC. 24, 1980
94 STAT. 3489
"(3) FRACTIONAL PART OF PROOF GALLON.—In the case of any fractional part of a proof gallon of the wine content, or of the flavors content, of distilled spirits, a proportionate credit shall be allowed. "(b) TIME FOR DETERMINING AND ALLOWING CREDIT.—
"(1) IN GENERAL.—The credit allowable by subsection (a)— "(A) shall be determined at the same time the tax is determined under section 5006 (or 7652) on the distilled spirits containing the wine or flavors, and "(B) shall be allowable at the time the tax imposed by section 5001 (or 7652) on such distilled spirits is payable as if the credit allowable by this section constituted a reduction in the rate of tax. "(2) DETERMINATION OF CONTENT IN THE CASE OF IMPORTS.—For
purposes of this section, the wine content, and the flavors content, of imported distilled spirits shall be established by such chemical analysis, certification, or other methods as may be set forth in regulations prescribed by the Secretary. "(c) DEFINITIONS.—For purposes of this section— "(1) WINE CONTENT.—
"(A) IN GENERAL.—The term 'wine content' means alcohol derived from wine. "(B) WINE.—The term 'wine'— "(i) means wine on which tax would be imposed by paragraph (1), (2), or (3) of section 5041(b) but for its removal to bonded premises, and "(ii) does not include any substance which has been subject to distillation at a distilled spirits plant after receipt in bond. "(2) FLAVORS CONTENT.—
"(A) IN GENERAL.—Except as provided in subparagraph (B), the term 'flavors content' means alcohol derived from flavors of a type for which drawback is allowable under section 5134. "(B) EXCEPTIONS.—The term 'flavors content' does not include— "(i) alcohol derived from flavors made at a distilled spirits plant, and "(ii) in the case of any distilled spirits product, alcohol derived from flavors to the extent such alcohol exceeds (on a proof gallon basis) 2y2 percent of the finished product." (b) CLERICAL AMENDMENT.—The table of sections for such subpart A of part I of subchapter A of chapter 51 of such Code is amended by adding at the end thereof the following new item: "Sec. 5010. Credit for wine content and for flavors content." (c) EFFECTIVE DATE.—The amendments made by subsections (a) and 26 USC 50io
(b) shall take effect on January 1, 1980.
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