GAS GUZZLER TAX; COMPUTATION OF LIABILITY FOR IMPORTERS OF AUTOS WITHOUT EPA FUEL ECONOMY RATING
Rev. Proc. 86-9; 1986-1 C.B. 530
- Institutional AuthorsInternal Revenue Service
- Code Sections
- Jurisdictions
- LanguageEnglish
- Tax Analysts Electronic Citation86 TNT 34-13
Amplified by Rev. Proc. 87-10
Rev. Proc. 86-9
SECTION 1. PURPOSE
The purpose of this revenue procedure is to set forth guidelines for importers of automobiles to compute gas guzzler tax liability under section 4064 of the Internal Revenue Code for automobiles that are imported without a fuel economy rating assigned by the Environmental Protection Agency (EPA).
SECTION 2. BACKGROUND
01 Section 4064 of the Code imposes on the sale by the manufacturer (the definition of which includes an importer) of each automobile a tax in accordance with the tables set forth in section 4064(a). The liability for tax is based on the model year of the automobile and the fuel economy rating of the model type into which the automobile falls.
02 Rev. Rul. 86-20, page 16, this Bulletin, concerns automobiles that are imported without a prototype-based fuel economy rating assigned by the EPA. The ruling holds that the sale, use, or first lease of such an automobile is subject to the gas guzzler tax imposed by section 4064(a) of the Code.
03 Unless specifically excepted, automobiles imported into the United States must conform to federal emission standards. The large importers usually apply for a "certificate of conformity" to those emission standards by having prototype models tested for compliance. The certificate then becomes the importer's license to import vehicles into the United States. EPA also normally assigns fuel economy ratings to those prototype automobiles. The fuel economy rating is a combination of the urban economy rating, which is based on the emission test results, and the highway economy rating.
04 Automobiles that are imported without a "certificate of conformity" must either be (1) converted, by installation of emission controls, to conform in all material respects to an automobile that is already certified for sale in the United States or (2) modified by installation of emission control components and individually tested to demonstrate emission compliance. See EPA regulations, Importation of Motor Vehicles and Motor Vehicle Engines, 40 C.F.R. section 85.1504 (1984). A fuel economy rating is not generally available for these vehicles because EPA does not require a highway fuel economy test on them and thus a separate highway fuel economy test would be required in order to devise a fuel economy rating.
SEC. 3. SCOPE AND OBJECTIVE
01 Section 4064(c)(1) of the Code provides that, for purposes of the gas guzzler tax, fuel economy for any model type shall be measured in accordance with testing and calculation procedures established by the EPA Administrator by regulation. Procedures so established shall be the procedures utilized by the EPA Administrator for model year 1975 (weighted 55 percent urban cycle, and 45 percent highway cycle), or procedures which yield comparable results. Such procedures, to the extent practicable, shall require that fuel economy tests be conducted in conjunction with emissions tests conducted under section 206 of the Clear Air Act, 42 U.S.C. section 7521 (1982). The EPA Administrator shall report any measurements of fuel economy to the Secretary.
02 Although those automobiles that are imported into the United States and are modified under the two methods described in section 2.04 are not assigned fuel economy ratings at the time of emission testing or modification, these vehicles are subject to the gas guzzler tax under Rev. Rul. 86-20, and liability is computed as follows:
SEC. 4. PROCEDURE
01 Except as provided in section 4.04, in those instances where the importer modifies, or causes to be modified, an imported automobile under the first method set forth in section 2.04, the fuel economy rating for such automobile shall be equal to the EPA- prescribed rating for the original manufacturer's certified prototype to which such automobile has been modified to conform for emission purposes. The EPA-prescribed fuel economy ratings for model years, 1980 through 1986 are listed below.
FUEL
MANUFACTURER CARLINE CID/CYL SYSTEM
Aston Martin Saloon/Vantage/Volante 326/8 8
Aston Martin Saloon/Vantage/Volante 326/8 8
Ferrari 308 179/8 FI
Maserati Quattroporte 301/8 8
Maserati Merak 181/6 6
Rolls-Royce Motors Rolls-Royce/Bentley 412/8 2
Rolls-Royce Motors Rolls-Royce/Bentley 412/8 FI
Rolls-Royce Motors Camargue 412/8 2
Rolls-Royce Motors Camargue 412/8 FI
1981
Aston Martin Saloon/Vantage/Volante 326/8 8
Aston Martin Saloon/Vantage/Volante 326/8 8
Checker Marathon/Taxicab 267/8 2
Checker Marathon/Taxicab-E 267/8 2
Ferrari 308 179/8 FI
Ferrari Mondial 179/8 FI
Maserati Quattroporte 301/8 8
Rolls-Royce Motors Camargue 412/8 FI
Rolls-Royce Motors Corniche 412/8 FI
Rolls-Royce Motors Silver Spirit/Spur/Mulsanne 412/8 FI
Excalibur Autos Phaeton 305/8 4
1982
Aston Martin Saloon/Vantage/Volante 326/8 8
Aston Martin Saloon/Vantage/Volante 326/8 8
Bitter GMBH & Co. KG SC 181/6 FI
Bitter GMBH & Co. KG SC 181/6 FI
Checker Marathon/Taxicab 267/8 2
Checker Marathon/Taxicab-E 267/8 2
Ferrari 308 179/8 FI
Ferrari Mondial 179/8 FI
Jaguar XJ-S 326/12 FI
Maserati Quattroporte 301/8 8
Rolls-Royce Motors Camargue 412/8 FI
Rolls-Royce Motors Corniche 412/8 FI
Rolls-Royce Motors Silver Spirit/Spur/Mulsanne 412/8 FI
Excalibur Autos Phaeton 305/8 4
1983
Aston Martin Saloon/Vantage/Volante 326/8 8
Aston Martin Saloon/Vantage/Volante 326/8 8
Aston Martin Lagonda 326/8 8
Bitter GMBH & Co. KG SC 181/6 FI
Bitter GMBH & Co. KG SC 181/6 FI
Ferrari 308 179/8 FI
Ferrari Mondial 179/8 FI
Jaguar XJS 326/12 FI
Lotus Esprit 132/4 4
Maserati Quattroporte 301/8
Rolls-Royce Motors Camargue 412/8 FI
Rolls-Royce Motors Corniche 412/8 FI
Rolls-Royce Motors Silver Spirit/Spur/Mulsanne 412/8 FI
Zimmer Motor Cars Co. Golden Spirit 302/8 4
Lamborghini Countach LP500S 290/12 FI
1984
Aston Martin Logonda Saloon/Vantage/Volante 326/8 8
Aston Martin Logonda Saloon/Vantage/Volante 326/8 8
Aston Martin Lagonda Lagonda 326/8 8
Aurora Cars LTD Aurora MK II 302/8 4
Bitter GMBL & Co. KG SC 181/6 FI
Bitter GMBL & Co. KG SC 181/6 FI
Mercedes Benz 500SEL 303/8 FI
Mercedes Benz 500SEC 303/8 FI
Ferrari 308 179/8 FI
Ferrari Mondial 179/8 FI
Jaguar XJS 326/12 FI
Lotus Esprit 132/4 4
Maserati Biturbo 153/6 2
Maerati Quottroporte 301/8 8
Rolls-Royce Motors Camargue 412/8 FI
Rolls-Royce Motors Corniche 412/8 FI
Rolls-Royce Motors Silver Spirit/Spur Mulsanne 412/8 FI
Rolls-Royce Motors Silver Spur Limousine 412/8 FI
Excalibur Motors Phaeton 305/8 4
Lamborghini of North Countach LP500S 290/12 FI
America
1985
Aston Martin Saloon/Vantage/Volante 326/8 8
Aston Martin Saloon/Vantage/Volante 326/8 8
Aston Martin Lagonda 326/8 8
BMW 7-Series 209/6 FI
Mercedes-Benz 380SE 234/8 FI
Mercedes-Benz 380SL 234/8 FI
Mercedes-Benz 500SEL 303/8 FI
Mercedes-Benz 500SEC 303/8 FI
Ferrari 308 179/8 FI
Ferrari Mondial 179/8 FI
Ferrari Testarossa 302/12 FI
Jaguar Cars Inc. XJ 258/6 FI
Jaguar Cars Inc. Jaguar XJ-S 326/12 FI
Lotus Esprit Turbo 133/4 4
Maserati Quattroporte 301/8 8
Maserati Biturbo (Subcompact) 152/6 2
Maserati Biturbo (Minicompact) 152/6 2
Maserati Biturbo 152/6 2
Nissan Motor Co., LT 300ZX 181/6 FI
1986
BMW 5-Series 209/6 FI
BMW 5-Series 209/6 FI
BMW 6-Series 209/6 FI
BMW 6-Series 209/6 FI
BMW 7-Series 209/6 FI
BMW 7-Series 209/6 FI
Mercedes Benz 420SEL 256/8 FI
Mercedes Benz 560SEL 338/8 FI
Mercedes Benz 560SEC 338/8 FI
Mercedes Benz 560SL 338/8 FI
Ferrari Testarossa 302/12 FI
Ferrari 328 GTS/GTB 194/8 FI
Ferrari 3.2 Mondial/Cabriolet 194/8 FI
Jaguar Cars Inc. Jaguar XJ6 258/6 FI
Jaguar Cars Inc. Jaguar XJ-S 326/12 FI
Maserati Biturbo Spyder 152/6 2
Maserati Biturbo 152/6 2
Maserati Biturbo 425 152/6 2
Porsche 911 201/6 FI
Rolls-Royce Camargue 412/8 FI
Rolls-Royce Corniche II/Continental 412/8 FI
Rolls-Royce Silver Spirit/Spur/Mulsanne 412/8 FI
Rolls-Royce Silver Spur Limousine 412/8 FI
Lamborghini EA Countach 315/12 FI
Table (Continued)
FUEL
ECONOMY
MANUFACTURER CARLINE TRANS RATING
Aston Martin Saloon/Vantage/Volante A3 12.1
Aston Martin Saloon/Vantage/Volante M5 11.7
Ferrari 308 M5 13.2
Maserati Quattroporte A3 8.8
Maserati Merak M5 12.1
Rolls-Royce Motors Rolls-Royce/Bentley A3 11.6
Rolls-Royce Motors Rolls-Royce/Bentley A3 10.4
Rolls-Royce Motors Camargue A3 11.6
Rolls-Royce Motors Camargue A3 10.9
1981
Aston Martin Saloon/Vantage/Volante A3 12.1
Aston Martin Saloon/Vantage/Volante M5 11.7
Checker Marathon/Taxicab A3 16.5
Checker Marathon/Taxicab-E A3 16.5
Ferrari 308 M5 13.1
Ferrari Mondial M5 13.1
Maserati Quattroporte A3 10.0
Rolls-Royce Motors Camargue A3 10.1
Rolls-Royce Motors Corniche A3 10.1
Rolls-Royce Motors Silver Spirit/Spur/Mulsanne A3 11.0
Excalibur Autos Phaeton A3 16.2
1982
Aston Martin Saloon/Vantage/Volante A3 12.1
Aston Martin Saloon/Vantage/Volante M5 11.7
Bitter GMBH & Co. KG SC A3 16.7
Bitter GMBH & Co. KG SC M5 17.8
Checker Marathon/Taxicab A3 16.5
Checker Marathon/Taxicab-E A3 16.5
Ferrari 308 M5 13.0
Ferrari Mondial M5 13.0
Jaguar XJ-S A3 16.8
Maserati Quattroporte A3 10.0
Rolls-Royce Motors Camargue A3 10.1
Rolls-Royce Motors Corniche A3 10.1
Rolls-Royce Motors Silver Spirit/Spur/Mulsanne A3 11.0
Excalibur Autos Phaeton A3 16.2
1983
Aston Martin Saloon/Vantage/Volante A3 11.8
Aston Martin Saloon/Vantage/Volante M5 10.3
Aston Martin Lagonda A3 11.3
Bitter GMBH & Co. KG SC M5 17.8
Bitter GMBH & Co. KG SC A3 16.7
Ferrari 308 M5 13.1
Ferrari Mondial M5 13.1
Jaguar XJS A3 16.9
Lotus Esprit M5 17.7
Maserati Quattroporte A3 10.0
Rolls-Royce Motors Camargue A3 11.0
Rolls-Royce Motors Corniche A3 11.0
Rolls-Royce Motors Silver Spirit/Spur/Mulsanne A3 11.0
Zimmer Motor Cars Co. Golden Spirit A3 14.8
Lamborghini Countach LP500S M5 13.7
1984
Aston Martin Logonda Saloon/Vantage/Volante A3 11.8
Aston Martin Logonda Saloon/Vantage/Volante M5 10.3
Aston Martin Lagonda Lagonda A3 11.3
Aurora Cars LTD Aurora MK II M5 19.3
Bitter GMBL & Co. KG SC M5 17.8
Bitter GMBL & Co. KG SC A3 16.7
Mercedes Benz 500SEL A4 17.0
Mercedes Benz 500SEC A4 17.0
Ferrari 308 M5 14.1
Ferrari Mondial M5 14.1
Jaguar XJS A3 16.9
Lotus Esprit M5 17.7
Maserati Biturbo M5 18.7
Maserati Quottroporte A3 10.0
Rolls-Royce Motors Camargue A3 11.0
Rolls-Royce Motors Corniche A3 11.0
Rolls-Royce Motors Silver Spirit/Spur Mulsanne A3 11.0
Rolls-Royce Motors Silver Spur Limousine A3 10.1
Excalibur Motors Phaeton A4 17.9
Lamborghini of North Countach LP500S M5 13.7
America
1985
Aston Martin Saloon/Vantage/Volante L3 10.3
Aston Martin Saloon/Vantage/Volante M5 10.7
Aston Martin Lagonda L3 10.3
BMW 7-Series M5 20.3
Mercedes-Benz 380SE A4 20.0
Mercedes-Benz 380SL A4 20.0
Mercedes-Benz 500SEL A4 17.1
Mercedes-Benz 500SEC A4 17.1
Ferrari 308 M5 14.0
Ferrari Mondial M5 14.0
Ferrari Testarossa M5 13.4
Jaguar Cars Inc. XJ A3 20.0
Jaguar Cars Inc. Jaguar XJ-S A3 16.9
Lotus Esprit Turbo M5 17.7
Maserati Quattroporte L3 10.0
Maserati Biturbo (Subcompact) M5 18.7
Maserati Biturbo (Minicompact) M5 18.4
Maserati Biturbo A3 15.7
Nissan Motor Co., LT 300ZX A4 20.2
1986
BMW 5-Series L4 21.2
BMW 5-Series M5 21.2
BMW 6-Series L4 21.2
BMW 6-Series M5 21.2
BMW 7-Series L4 19.7
BMW 7-Series M5 20.0
Mercedes Benz 420SEL A4 19.1
Mercedes Benz 560SEL A4 17.3
Mercedes Benz 560SEC A4 17.3
Mercedes Benz 560SL A4 17.7
Ferrari Testarossa M5 13.5
Ferrari 328 GTS/GTB M5 17.2
Ferrari 3.2 Mondial/Cabriolet M5 17.2
Jaguar Cars Inc. Jaguar XJ6 A3 19.7
Jaguar Cars Inc. Jaguar XJ-S A3 16.7
Maserati Biturbo Spyder A3 16.8
Maserati Biturbo A3 16.8
Maserati Biturbo 425 A3 16.8
Porsche 911 M4 21.7
Rolls-Royce Camargue A3 11.0
Rolls-Royce Corniche II/Continental A3 11.0
Rolls-Royce Silver Spirit/Spur/Mulsanne A3 11.1
Rolls-Royce Silver Spur Limousine A3 10.2
Lamborghini EA Countach M5 8.8
02 If, as in the second method set forth in section 2.04, an automobile has been modified and individually tested for emission compliance, no certified automobile is available for comparison. Except as provided in section 4.04, the imported automobile is presumed to fall within the lowest fuel economy rating prescribed for the particular model year of the automobile in the tax rate tables contained in section 4064(a) of the Code. For purposes of complying with section 4.01 and this section 4.02, the importer shall retain documentation of modification and/or testing for a period of three years from the date the tax becomes due or the date the tax is paid, whichever is later.
03 Certain imported automobiles are exempted from compliance with the federal emission standards by virtue of EPA enforcement and regulatory exemptions. Those vehicles may be driven in the United States without modification or testing. For purposes of the gas guzzler tax, such a vehicle is ascribed the lowest fuel economy rating in the tables in section 4064(a) of the Code for the particular model year of the automobile. An automobile that is imported under an EPA exemption and is later modified to conform to federal emission standards is ascribed a fuel economy rating as if it had been imported and modified according to one of the methods described in section 2.04.
04 In any instance where an importer believes that an ascribed fuel economy rating is inappropriate for a particular vehicle, the importer may, at the importer's own expense, have the vehicle individually tested. The testing must be in accordance with EPA procedures for a fuel economy rating and must be carried out at one of the EPA (Office of Air, Noise and Radiation) recognized laboratories that are capable of conducting motor vehicle emission tests. State emission checks or tests performed at service stations or repair shops are not acceptable. The taxpayer shall retain the fuel economy test documentation for a period of three years from the date the tax becomes due or the date the tax is paid, whichever is later.
SEC. 5. EFFECTIVE DATE
This revenue procedure is effective with respect to 1980 and later model year automobiles.
- Institutional AuthorsInternal Revenue Service
- Code Sections
- Jurisdictions
- LanguageEnglish
- Tax Analysts Electronic Citation86 TNT 34-13