§ 7652 Shipments to the United States

OLRC 119-134 · eCFR 2026-10-19 · 26 amending Acts · cited by 11 sections

Enacted 1954 · Act Aug. 16, 1954, ch. 736 Amended · 26 Acts · From 1939 Code § 3350(a), (b) · § 3360(a) · § 3360(b) · § 3360(c)

1954195819651976198319841986198819931994199920002002200420052006200820102013201420152017201820202025(a) Puerto Rico(b) Virgin Islands(c) Articles containing distilled spirits(d) Articles other than articles containing distilled spirits(e) Shipments of rum to the United States(f) Limitation on cover over of tax on distilled spirits(g) Drawback for medicinal alcohol, etc.(h) Manner of cover over of tax must be derived from this title(i) Determination of taxes collected
Connections Cited by 11 · Cites 5
§ 7652 Shipments to the United States

(a) Puerto Rico

Cited by 2

    (1) Rate of tax Except as provided in section 5314, articles of merchandise of Puerto Rican manufacture coming into the United States and withdrawn for consumption or sale shall be subject to a tax equal to the internal revenue tax imposed in the United States upon the like articles of merchandise of domestic manufacture.

    Amended 1958
    • 1958 Pub. L. 85-859 Pub. L. 85–859, § 204(17), substituted “section 5314” for “section 5318”.
    Cited by 1

      (2) Payment of tax The Secretary shall by regulations prescribe the mode and time for payment and collection of the tax described in paragraph (1), including any discretionary method described in section 6302(b) and (c). Such regulations shall authorize the payment of such tax before shipment from Puerto Rico, and the provisions of section 7651(2)(B) shall be applicable to the payment and collection of such tax in Puerto Rico.

      Amended 1976
      • 1976 Pub. L. 94-455 Pub. L. 94–455, § 1906(b)(13)(A), struck out “or his delegate” after “Secretary”.

      (3) Deposit of internal revenue collections All taxes collected under the internal revenue laws of the United States on articles produced in Puerto Rico and transported to the United States (less the estimated amount necessary for payment of refunds and drawbacks), or consumed in the island, shall be covered into the treasury of Puerto Rico.

      Amended 1965
      • 1965 Pub. L. 89-44 Pub. L. 89–44 inserted “(less the estimated amount necessary for payment of refunds and drawbacks)” after “transported to the United States”.
      Cited by 9

        (b) Virgin Islands

        Cited by 1

          (1) Taxes imposed in the United States Except as provided in section 5314, there shall be imposed in the United States, upon articles coming into the United States from the Virgin Islands, a tax equal to the internal revenue tax imposed in the United States upon like articles of domestic manufacture.

          Amended 1958
          • 1958 Pub. L. 85-859 Pub. L. 85–859, § 204(18), substituted “section 5314” for “section 5318”.
          Cited by 1

            (2) Exemption from tax imposed in the Virgin Islands Such articles shipped from such islands to the United States shall be exempt from the payment of any tax imposed by the internal revenue laws of such islands.

            (3) Disposition of internal revenue collections The Secretary shall determine the amount of all taxes imposed by, and collected under the internal revenue laws of the United States on articles produced in the Virgin Islands and transported to the United States. The amount so determined less 1 percent and less the estimated amount of refunds or credits shall be subject to disposition as follows:

            Amended 1976, 1983, 2000
            • 2000 Pub. L. 106-200 Pub. L. 106–200, § 602(b), amended generally par. (3) heading and text of par. (3) introductory provisions and subpar. (A). Prior to amendment, text of par. (3) introductory provisions and subpar. (A) read as follows: “Beginning with the calendar quarter ending September 30, 1975, and quarterly thereafter, the Secretary shall determine the amount of all taxes imposed by, and collected during the quarter under, the internal revenue laws of the United States on articles produced in the Virgin Islands and transported to the United States. The amount so determined less 1 percent and less the estimated amount of refunds or credits shall be subject to disposition as follows:

              “(A) There shall be transferred and paid over, as soon as practicable after the close of the quarter, to the Government of the Virgin Islands from the amounts so determined a sum equal to the total amount of the revenue collected by the Government of the Virgin Islands during the quarter, as certified by the Government Comptroller of the Virgin Islands. The moneys so transferred and paid over shall constitute a separate fund in the treasury of the Virgin Islands and may be expended as the legislature may determine.”

            • 1983 Pub. L. 98-213 Pub. L. 98–213, § 5(c), amended language of Pub. L. 94–455, § 1906(a)(55). See 1976 Amendment note below.
            • 1976 Pub. L. 94-455 Pub. L. 94–455, § 1906(b)(13)(A), struck out “or his delegate” after “Secretary” in provisions following subpar. (B).
            • 1976 Pub. L. 94-455 Pub. L. 94–455, § 1906(a)(55)(B), as amended by Pub. L. 98–213, § 5(c)(1), substituted “emergency relief purposes and essential public projects” for “emergency relief purposes and essential public projects, with the prior approval of the President or his designated representative” in provisions following subpar. (B). Prior to amendment by Pub. L. 98–213, the latter phrase had been substituted for “approved emergency relief purposes and essential public projects as provided in subparagraph (B)”.
            • 1976 Pub. L. 94-455 Pub. L. 94–455, § 1906(a)(55)(C), struck out “including payments under subparagraph (B)” after “public projects only” in provisions following subpar. (B).
            • 1976 Pub. L. 94-455 Pub. L. 94–455, § 1906(a)(55)(A), redesignated subpar. (C) as (B). Former subpar. (B) relating to disposition of internal revenue collections in Virgin Islands for fiscal years ending June 30, 1955 and 1956 was struck out.
            • 1976 Pub. L. 94-202 Pub. L. 94–202 substituted “calendar quarter ending September 30, 1975, and quarterly” for “fiscal year ending June 30, 1954, and annually” and “quarter” for “fiscal year” in provisions preceding subpar. (A), substituted “paid over, as soon as practicable after the close of the quarter,” for “paid over” and “quarter” for “fiscal year” in subpar. (A), and substituted “with respect to the four calendar quarters immediately preceding the beginning” for “at the beginning” in provisions following subpar. (C).
            Cited by 9

              (A) The payment of an estimated amount shall be made to the government of the Virgin Islands before the commencement of each fiscal year as set forth in section 4(c)(2) of the Act entitled “An Act to authorize appropriations for certain insular areas of the United States, and for other purposes”, approved August 18, 1978 (48 U.S.C. 1645), as in effect on the date of the enactment of the Trade and Development Act of 2000. The payment so made shall constitute a separate fund in the treasury of the Virgin Islands and may be expended as the legislature may determine.

              Amended 1976
              • 1976 Pub. L. 94-455 Pub. L. 94–455, § 1906(a)(55)(D), as added by Pub. L. 98–213, § 5(c)(2), struck out proviso after “determine” requiring approval of the President or his designated representative before such moneys may be obligated or expended.
              Cited by 1

                (B) Any amounts remaining shall be deposited in the Treasury of the United States as miscellaneous receipts.

                Amended 1976
                • 1976 Pub. L. 94-455 Pub. L. 94–455, § 1906(a)(55)(A), redesignated subpar. (C) as (B). Former subpar. (B) relating to disposition of internal revenue collections in Virgin Islands for fiscal years ending June 30, 1955 and 1956 was struck out.
                • 1976 Pub. L. 94-202 Pub. L. 94–202 substituted “calendar quarter ending September 30, 1975, and quarterly” for “fiscal year ending June 30, 1954, and annually” and “quarter” for “fiscal year” in provisions preceding subpar. (A), substituted “paid over, as soon as practicable after the close of the quarter,” for “paid over” and “quarter” for “fiscal year” in subpar. (A), and substituted “with respect to the four calendar quarters immediately preceding the beginning” for “at the beginning” in provisions following subpar. (C).

                If at the end of any fiscal year the total of the Federal contribution made under subparagraph (A) with respect to the four calendar quarters immediately preceding the beginning of that fiscal year has not been obligated or expended for an approved purpose, the balance shall continue available for expenditure during any succeeding fiscal year, but only for emergency relief purposes and essential public projects. The aggregate amount of moneys available for expenditure for emergency relief purposes and essential public projects only shall not exceed the sum of $5,000,000 at the end of any fiscal year. Any unobligated or unexpended balance of the Federal contribution remaining at the end of a fiscal year which would cause the moneys available for emergency relief purposes and essential public projects only to exceed the sum of $5,000,000 shall thereupon be transferred and paid over to the Treasury of the United States as miscellaneous receipts.

                (c) Articles containing distilled spirits For purposes of subsections (a)(3) and (b)(3), any article containing distilled spirits shall in no event be treated as produced in Puerto Rico or the Virgin Islands unless at least 92 percent of the alcoholic content in such article is attributable to rum.

                Amended 1983, 1984
                • 1984 Pub. L. 98-369 Pub. L. 98–369, § 2681(a), added subsecs. (c) and (d) and redesignated former subsec. (c) as (e).
                • 1983 Pub. L. 98-67 Pub. L. 98–67 added subsec. (c).

                (d) Articles other than articles containing distilled spirits For purposes of subsections (a)(3) and (b)(3)—

                Amended 1984
                • 1984 Pub. L. 98-369 Pub. L. 98–369, § 2681(a), added subsecs. (c) and (d) and redesignated former subsec. (c) as (e).

                (1) Value added requirement for Puerto Rico Any article, other than an article containing distilled spirits, shall in no event be treated as produced in Puerto Rico unless the sum of—

                (A) the cost or value of the materials produced in Puerto Rico, plus

                (B) the direct costs of processing operations performed in Puerto Rico,

                equals or exceeds 50 percent of the value of such article as of the time it is brought into the United States.

                (2) Prohibition of Federal excise tax subsidies

                (A) In general No amount shall be transferred under subsection (a)(3) or (b)(3) in respect of taxes imposed on any article, other than an article containing distilled spirits, if the Secretary determines that a Federal excise tax subsidy was provided by Puerto Rico or the Virgin Islands (as the case may be) with respect to such article.

                (B) Federal excise tax subsidy For purposes of this paragraph, the term “Federal excise tax subsidy” means any subsidy—

                (i) of a kind different from, or

                (ii) in an amount per value or volume of production greater than,

                the subsidy which Puerto Rico or the Virgin Islands offers generally to industries producing articles not subject to Federal excise taxes.

                (3) Direct costs of processing operations For purposes of this subsection, the term “direct cost of processing operations” has the same meaning as when used in section 213 of the Caribbean Basin Economic Recovery Act.

                (e) Shipments of rum to the United States

                Amended 1984, 2018, 2020
                • 2020 Pub. L. 116-260 Pub. L. 116–260, § 106(a)(2)(B), struck out par. (5). Text read as follows: “For purposes of this subsection, the amount of taxes collected under section 5001(a)(1) shall be determined without regard to section 5001(c).”
                • 2018 Pub. L. 115-123 Pub. L. 115–123, § 41102(b)(1), added par. (5).
                • 1984 Pub. L. 98-369 Pub. L. 98–369, § 2681(a), added subsecs. (c) and (d) and redesignated former subsec. (c) as (e).

                (1) Excise taxes on rum covered into treasuries of Puerto Rico and Virgin Islands All taxes collected under section 5001(a)(1) on rum imported into the United States (less the estimated amount necessary for payment of refunds and drawbacks) shall be covered into the treasuries of Puerto Rico and the Virgin Islands.

                Cited by 2

                  (2) Secretary prescribes formula The Secretary shall, from time to time, prescribe by regulation a formula for the division of such tax collections between Puerto Rico and the Virgin Islands and the timing and methods for transferring such tax collections.

                  (3) Rum defined For purposes of this subsection, the term “rum” means any article classified under subheading 2208.40.00 of the Harmonized Tariff Schedule of the United States (19 U.S.C. 1202).

                  Amended 1988
                  • 1988 Pub. L. 100-418 Pub. L. 100–418 substituted “subheading 2208.40.00 of the Harmonized Tariff Schedule of the United States” for “item 169.13 or 169.14 of the Tariff Schedules of the United States”.

                  (4) Coordination with subsections (a) and (b) Paragraph (1) shall not apply with respect to any rum subject to tax under subsection (a) or (b).

                  (f) Limitation on cover over of tax on distilled spirits For purposes of this section, with respect to taxes imposed under section 5001 or this section on distilled spirits, the amount covered into the treasuries of Puerto Rico and the Virgin Islands shall not exceed the lesser of the rate of—

                  Amended 1984
                  Cited by 1

                    (1) $13.25, or

                    Amended 1993, 1999, 2002, 2004, 2006, 2008, 2010, 2013, 2014, 2015, 2018, 2025
                    • 2025 Pub. L. 119-21 Pub. L. 119–21 amended par. (1) generally. Prior to amendment, par. (1) read as follows: “$10.50 ($13.25 in the case of distilled spirits brought into the United States after June 30, 1999, and before January 1, 2022), or”.
                    • 2018 Pub. L. 115-123 Pub. L. 115–123, § 41102(a)(1), substituted “January 1, 2022” for “January 1, 2017”.
                    • 2015 Pub. L. 114-113 Pub. L. 114–113 substituted “January 1, 2017” for “January 1, 2015”.
                    • 2014 Pub. L. 113-295 Pub. L. 113–295 substituted “January 1, 2015” for “January 1, 2014”.
                    • 2013 Pub. L. 112-240 Pub. L. 112–240 substituted “January 1, 2014” for “January 1, 2012”.
                    • 2010 Pub. L. 111-312 Pub. L. 111–312 substituted “January 1, 2012” for “January 1, 2010”.
                    • 2008 Pub. L. 110-343 Pub. L. 110–343 substituted “January 1, 2010” for “January 1, 2008”.
                    • 2006 Pub. L. 109-432 Pub. L. 109–432 substituted “2008” for “2006”.
                    • 2004 Pub. L. 108-311 Pub. L. 108–311 substituted “January 1, 2006” for “January 1, 2004”.
                    • 2002 Pub. L. 107-147 Pub. L. 107–147 substituted “January 1, 2004” for “January 1, 2002”.
                    • 1999 Pub. L. 106-170 Pub. L. 106–170 amended par. (1) generally. Prior to amendment, par. (1) read as follows: “$10.50 ($11.30 in the case of distilled spirits brought into the United States during the 5-year period beginning on October 1, 1993), or.”
                    • 1993 Pub. L. 103-66 Pub. L. 103–66 amended par. (1) generally, substituting present provisions for “$10.50, or”.

                    (2) the tax imposed under subsection (a)(1) of section 5001, determined as if subsection (c)(1) of such section did not apply, on each proof gallon.

                    Amended 2017
                    • 2017 Pub. L. 115-97 Pub. L. 115–97 substituted “subsection (a)(1) of section 5001, determined as if subsection (c)(1) of such section did not apply” for “section 5001(a)(1)”.

                    (g) Drawback for medicinal alcohol, etc. In the case of medicines, medicinal preparations, food products, flavors, flavoring extracts, or perfume containing distilled spirits, which are unfit for beverage purposes and which are brought into the United States from Puerto Rico or the Virgin Islands—

                    Amended 1986, 1994
                    • 1994 Pub. L. 103-465 Pub. L. 103–465 substituted “flavoring extracts, or perfume” for “or flavoring extracts” in introductory provisions.
                    • 1986 Pub. L. 99-514 Pub. L. 99–514 added subsec. (g).

                    (1) subpart B of part II of subchapter A of chapter 51 shall be applied as if—

                    Amended 2005
                    • 2005 Pub. L. 109-59 Pub. L. 109–59, § 11125(b)(22)(A), substituted “subpart B” for “subpart F” in introductory provisions.

                    (A) the use and tax determination described in section 5111 had occurred in the United States by a United States person at the time the article is brought into the United States, and

                    Amended 2005
                    • 2005 Pub. L. 109-59 Pub. L. 109–59, § 11125(b)(22)(B), substituted “section 5111” for “section 5131(a)”.

                    (B) the rate of tax were the rate applicable under subsection (f) of this section, and

                    (2) no amount shall be covered into the treasuries of Puerto Rico or the Virgin Islands.

                    (h) Manner of cover over of tax must be derived from this title No amount shall be covered into the treasury of Puerto Rico or the Virgin Islands with respect to taxes for which cover over is provided under this section unless made in the manner specified in this section without regard to—

                    Amended 2000

                    (1) any provision of law which is not contained in this title or in a revenue Act; and

                    (2) whether such provision of law is a subsequently enacted provision or directly or indirectly seeks to waive the application of this subsection.

                    (i) Determination of taxes collected For purposes of subsections (a)(3), (b)(3), and (e)(1), refunds under section 5001(c)(4) shall not be taken into account as a refund, and the amount of taxes imposed by and collected under section 5001(a)(1) shall be determined without regard to section 5001(c).

                    Amended 2020
                    • 2020 Pub. L. 116-260 Pub. L. 116–260, § 106(a)(2)(A), added subsec. (i).