Internal Revenue Service
Revenue Ruling

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 Rev. Rul. 54-8

1954-1 C.B. 275

Caution: Obsoleted by Rev. Rul. 69-227

IRS Headnote

The tax on the transportation of property imposed by section 3475 of the Internal Revenue Code does not apply to shipments of automobile chassis in the course of exportation to a foreign country even though the chassis are further manufactured in the foreign country and returned to the United States.

Full Text

Rev. Rul. 54-8

Advice is requested whether property shipped under the circumstances herein described constitutes property in the course of exportation to a foreign destination and exempt from tax on the transportation of property imposed by section 3475 of the Internal Revenue Code.

In the instant case, shipments of automobile chassis are made by the manufacturer from an inland point in the United States to a port of exportation from which port the chassis are shipped to a foreign country where bodies are built thereon and the completed vehicles returned to the manufacturer in the United States.

Section 143.30 of Regulations 113 provides that the tax imposed by section 3475 of the Code will not apply to an amount paid for transportation of property in the course of exportation to a foreign destination or shipment to a possession of the United States.

It is held that shipments of automobile chassis under the circumstances described are considered, for purposes of the tax imposed by section 3475 of the Code, to be in the course of exportation to a foreign country even though the chassis are further manufactured in the foreign country and returned to the United States. Accordingly, the tax on the transportation of property imposed by section 3475 of the Code will not apply to amounts paid for the transportation of the chassis from the point of shipment in the United States to the port of exportation, provided the person paying the transportation charges obtains proof of exportation in accordance with the provisions of Regulations 113.