Internal Revenue Service
Revenue Ruling

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 Rev. Rul. 65-42

1965-1 C.B. 457

IRS Headnote

Ball and roller bearings having a multiplicity of uses but possessing no unique characteristics of construction, design or material which would indicate they are to be used primarily in connection with taxable motor vehicle articles are not automobile `parts or accessories' as contemplated by section 4061(b) of the Internal Revenue Code of 1954.

Full Text

Rev. Rul. 65-42 /1/

Advice has been requested whether the manufacturers excise tax on automobile `parts or accessories' applies to sales by the manufacturer of the ball and roller bearings described below.

A company manufactures and sells an extensive line of ball and roller bearings for use in numerous mechanical applications. The application of these bearings will vary from one period to another depending upon the requirements of the various industries utilizing the bearings. One such application of these bearings is as original equipment and replacement parts for the motor vehicle articles enumerated in section 4061(a) of the Internal Revenue Code of 1954. However, the bearings incorporate no unique characteristics of construction, design or material indicative of a specific or primary purpose or use in this application.

Section 4061(b) of the Code imposes a tax upon sales by the manufacturer, producer, or importer of parts or accessories (other than tires and inner tubes and other than automobile radio and television receiving sets) for any of the motor vehicle articles enumerated in section 4061(a) of the Code.

Section 48.4061(b)-2(b) of the Manufacturers and Retailers Excise Tax Regulations provides that the term `parts or accessories' does not include articles which are not used primarily in the manufacture, repair, etc., of automobile trucks, other automobiles, or tractors, but have a general use in the manufacture, repair, etc., of various articles. This section further provides, by way of example, that commodities such as ball and roller bearings and similar articles are not of themselves parts or accessories unless so constructed as to be used primarily in the manufacture, repair, etc., of automobile trucks, other automobiles or tractors.

Where ball or roller bearings have a multiplicity of uses but possess no unique characteristics of construction, design or material which would indicate a use primarily in connection with taxable motor vehicle articles they are not `parts or accessories' within the meaning and intent of section 4061(b) of the Code and the applicable regulations. Accordingly, sales by the manufacturer of such bearings are not subject to the manufacturers excise tax on automobile parts or accessories.

/1/ Also released as Technical Information Release 691, dated Feb. 10, 1965.