SURVEYS AND INVESTIGATIONS SEC. 409. Whenever the Secretary determines that such action is necessary to effectuate the purposes of this Act, he is authorized, if first requested by persons constituting or representing a substantial proportion of the persons affected in any one of the five domestic sugar-producing areas, to make for such area surveys and investigations to the extent he deems necessary, including the holding of public hearings, and to make recommendations with respect to (a) the terms and conditions of contracts between the producers and processors of sugar beets and sugarcane in such area and (b) the terms and conditions of contracts between laborers and producers of sugar beets and sugarcane in such area. In carrying out the provisions of this section, information shall not be made public with respect to the individual operations of any processor, producer, or laborer. SEC. 410. The Secretary is authorized to conduct surveys, investigations, and research relating to the conditions and factors affecting the methods of accomplishing most effectively the purposes of this Act and for the benefit of agriculture generally in any area. Notwithstanding any provision of existing law, the Secretary is authorized to make public such information as he deems necessary to carry out the provisions of this Act. INTERNATIONAL SUGAR AGREEMENT SEC. 411. The Secretary is authorized to issue such regulations as may be necessary to carry out article 7 of the International Sugar Agreement for the Regulation of the Production and Marketing of Sugar (ratified by and with the advice and consent of the United States Senate on April 29, 1954), restricting importations of sugar into the United States from foreign countries not participating in such agreement, or to carry out the corresponding provisions of any such future agreements ratified by and with the advice and consent of the United States Senate. TERMINATION OF ACT SEC. 412. The powers vested in the Secretary under this Act shall terminate on December 31, 1966, except that the Secretary shall have power to make payments under title III under programs applicable to the crop year 1966 and previous crop years. EFFECTIVE DATE (SEC. 19, P.L. 535, 87th Cong. approved July 13, 1962) Except as otherwise provided, the amendments made by this Act shall become effective January 1, 1962. The amendments made by section 6 and section 12 of this Act shall each become effective on the date stated in regulations implementing each of such sections and published in the Federal Register, or sixty days after the date of enactment of this Act, whichever is earlier. NOTE. Sections 6 and 12. referred to above, are Sections 206 and 213, herein, concerning Sugar-Containing Products and Import Fees, respectively. EXCISE TAXES WITH RESPECT TO SUGAR-INTERNAL REVENUE CODE OF 1954 CHAPTER 37 Subchapter A-Sugar SEC. 4501. IMPOSITION OF TAX. (a) GENERAL.-There is hereby imposed upon manufactured sugar manufactured in the United States, a tax, to be paid by the manufacturer at the following rates: (1) on all manufactured sugar testing by the polariscope 92 sugar degrees, 0.465 cent per pound, and, for each additional sugar degree shown by the polariscopic test, 0.00875 cent per pound additional, and fractions of a degree in proportion; (2) on all manufactured sugar testing by the polariscope less than 92 sugar degrees, 0.5144 cent per pound of the total sugars therein. The manufacturer shall pay the tax with respect to manufactured sugar (1) which has been sold, or used in the production of other articles, by the manufacturer during the preceding month (if the tax has not already been paid) and (2) which has not been so sold or used within 12 months ending during the preceding calendar month, after it was manufactured (if the tax has not already been paid). For the purpose of determining whether sugar has been sold or used within 12 months after it was manufactured, sugar shall be considered to have been sold or used in the order in which it was manufactured. (b) IMPORT TAX.-In addition to any other tax or duty imposed by law, there is hereby imposed, under such regulations as the Secretary or his delegate shall prescribe, a tax upon articles imported or brought into the United States as follows: (1) on all manufactured sugar testing by the polariscope 92 sugar degrees, 0.465 cent per pound, and, for each additional sugar degree shown by the polariscopic test, 0.00875 cent per pound additional, and fractions of a degree in proportion; (2) on all manufactured sugar testing by the polariscope less than 92 sugar degrees, 0.5144 cent per pound of the total sugars therein; (3) on all articles composed in chief value of manufactured sugar, 0.5144 cent per pound of the total sugars therein. (c) TERMINATION OF TAX.-No tax shall be imposed under this subchapter on the manufacture, use, or importation of sugar or articles composed in chief value of sugar after June 30, 1967. Notwithstanding the provisions of subsection (a) or (b), no tax shall be imposed under this subchapter with respect to unsold sugar held by a manufacturer on June 30, 1967, or with respect to sugar or articles composed in chief value of sugar held in customs custody or control on such date. SEC. 4502. DEFINITIONS For the purposes of this subchapter (1) MANUFACTURER.-Any person who acquires any sugar which is to be manufactured into manufactured sugar but who, without further refining or otherwise improving it in quality, sells such sugar as manufactured sugar or uses such sugar as manufactured sugar in the production of other articles for sale shall be considered, for the purposes of section 4501 (a), the manufacturer of manufactured sugar and, as such, liable for the tax under section 4501 (a) with respect thereto. (2) PERSON.-The term "person" means an individual, partnership, corporation, or association. (3) MANUFACTURED SUGAR.-The term "manufactured sugar" means any sugar derived from sugarbeets or sugarcane, which is not to be, and which shall not be, further refined or otherwise improved in quality; except sugar in liquid form which contains nonsugar solids (excluding any foreign substance that may have been added or developed in the product) equal to more than 6 per centum of the total soluble solids and except also sirup of cane juice produced from sugarcane grown in continental United States. The grades or types of sugar within the meaning of this definition shall include, but shall not be limited to, granulated sugar, lump sugar, cube sugar, powdered sugar, sugar in the form of blocks, cones, or molded shapes, confectioners' sugar, washed sugar, centrifugal sugar, clarified sugar, turbinado sugar, plantation white sugar, muscovado sugar, refiners' soft sugar, invert sugar mush, raw sugar, sirups, molasses, and sugar mixtures. (4) TOTAL SUGARS.-The term "total sugars" means the total amount of the sucrose and of the reducing or invert sugars. (5) UNITED STATES.-The term "United States" shall be deemed to include the States, the District of Columbia, and Puerto Rico. SEC. 4503. EXEMPTIONS FOR SUGAR MANUFACTURED FOR HOME CONSUMPTION No tax shall be required to be paid under sec. 4501 (a) upon the manufacture of manufactured sugar by or for the producer of the sugar beets or sugarcane from which such manufactured sugar was derived for consumption by the producer's own family, employees, or household. SEC. 4504. IMPORT TAX IMPOSED AS TARIFF DUTY The tax imposed by section 4501 (b) shall be levied, assessed, collected, and paid in the same manner as a duty imposed by the Tariff Act of 1930 and shall be treated for the purposes of all provisions of law relating to the customs revenue as a duty imposed by such act, except that for the purposes of sections 336 and 350 of such act (the so-called flexible tariff and trade agreements provisions) such tax shall not be considered a duty or import restriction, and except that no preference with respect to such tax shall be accorded any article imported or brought into the United States, and except that such tax may be subject to refunds as a tax under the provisions of section 6418(a). CHAPTER 65-ABATEMENTS, CREDITS, AND REFUNDS SEC. 6412. FLOOR STOCKS REFUNDS. (d) SUGAR.-With respect to any sugar or articles composed in chief value of sugar upon which tax imposed under section 4501(b) has been paid and which, on June 30, 1967, are held by the importer and intended for sale or other disposition, there shall be refunded (without interest) to such importer, subject to such regulations as may be prescribed by the Secretary or his delegate, an amount equal to the tax paid with respect to such sugar or articles composed in chief value of sugar, if claim for such refund is filed with the Secretary or his delegate on or before September 30, 1967. SEC. 6418. SUGAR. (a) USE AS LIVESTOCK FEED OR FOR DISTILLATION OF ALCOHOL.-Upon the use of any manufactured sugar, or article manufactured therefrom, as livestock feed, or in the production of livestock feed, or for the distillation of alcohol, there shall be paid by the Secretary or his delegate to the person so using such manufactured sugar, or article manufactured therefrom, the amount of any tax paid under section 4501 with respect thereto. (b) EXPORTATION.-Upon the exportation from the United States to a foreign country, or the shipment from the United States to any possession of the United States except Puerto Rico, of any manufactured sugar, or any article manufactured wholly or partly from manufactured sugar, with respect to which tax under the provisions of section 4501(a) has been paid, the amount of such tax shall be paid by the Secretary or his delegate to the consignor named in the bill of lading under which the article was exported or shipped to a possession, or to the shipper, or to the manufacturer of the manufactured sugar or of the articles exported, if the consignor waives any claim thereto in favor of such shipper or manufacturer; except that no such payment shall be allowed with respect to any manufactured sugar, or article, upon which, through substitution or otherwise, a drawback of any tax paid under section 4501 (b) has been or is to be claimed under any provisions of law made applicable by section 4504. CHAPTER 66-LIMITATIONS SEC. 6511. LIMITATIONS ON CREDIT OR REFUND. (e) SPECIAL RULES IN CASE of ManufaCTURED SUGAR.— (1) USE AS LIVESTOCK FEED OR FOR DISTILLATION OF ALCOHOL.-No payment shall be allowed under section 6418 (a) unless within 2 years after the right to such payment has accrued a claim therefor is filed by the person entitled thereto. (2) EXPORTATION.-No payment shall be allowed under section 6418(b) unless within 2 years after the right to such payment has accrued a claim therefor is filed by the person entitled thereto. CHAPTER 75-CRIMES, OTHER OFFENSES, AND FORFEITURES SEC. 7240. OFFICIALS INVESTING OR SPECULATING IN SUGAR. Any person, while acting in an official capacity in the administration of subchapter A of chapter 37, relating to manufactured sugar, who invests or speculates in sugar or liquid sugar, contracts relating thereto, or the stock or membership interests of any association or corporation engaged in the production or manufacture of sugar or liquid sugar, shall be dismissed from office or discharged from employment and shall be guilty of a felony and, upon conviction thereof, be fined not more than $10,000, or imprisoned not more than 2 years, or both. NOTES: The foregoing provisions of the Internal Revenue Code do not reflect amendments made by the Tariff Classification Act of 1962 (P.L. 87-456, approved May 24, 1962,) which will become effective on or after the 10th day following the date of a Presidential proclamation provided for in the same law. These amendments substitute a tax rate of 0.53 cent per pound of total sugar content for the rates shown above under section 4501 (a). The import tax and any reference thereto, as part of the Internal Revenue Code, are repealed and transferred to the Tariff Schedules as an Appendix thereof, in the form of an additional duty at the same rate and for such time as the excise tax on sugar in the Internal Revenue Code is in effect. The text of these amendments is as follows: SEC. 302. (a) The first sentence of section 4501 (a) of the Internal Revenue Code of 1954 is amended to read as follows: "There is hereby imposed upon manufactured sugar manufactured in the United States, a tax, to be paid by the manufacturer at the rate of 0.53 cent per pound of the total sugars therein." (b) Section 4501 (a) of such Code is hereby repealed. Subsection (e) of section 4501 of such Code is redesignated as subsection (b), and such subsection is amended (1) by striking out "manufacture, use, or importation" in the first sentence thereof and inserting in lieu thereof "manufacture or use"; and (2) by striking out "subsection (a) or (b)" in the second sentence thereof and inserting in lieu thereof "subsection (a)". (c) Section 6418 (b) of such Code is amended by striking out “; except that no such payment shall be allowed with respect to any manufactured sugar, or article. upon which, through substitution or otherwise, a drawback of any tax paid under section 4501 (b) has been or is to be claimed under any provisions of law made applicable by section 4504". (d) Sections 4504, * * * * * 6412(d) and of such Code are hereby repealed and the tables of sections for such Code are correspondingly amended. The text of the new Appendix to the Tariff Schedules, Part 1, Subpart A, is contained on page 40 of the "First Supplemental Report" (January 1962), referentially enacted by Section 101 (b) of the Tariff Classification Act of 1962, and is as follows: Appendix to the tariff schedules Item Articles Rate of Effective Period 901.00 Part 1.-TEMPORARY LEGISLATION Subpart A.-Temporary Provisions for Additional Duties Subpart A headnotes: 1. The duties provied for in this subpart are cumulative duties which apply in addition to the duties, if any, otherwise imposed on the articles involved. The duties provided for in this subpart apply only with respect to articles entered during the period specified in the last column. 2. Sections 336 and 350 of this Act (the so-called flexible tariff and 3. With respect to any articles upon which the duty imposed under item Sugars, sirups, and molasses provided for in items 155.20 to 155.31, inclusive, The tax terminates June 30, 1967. 2 The tax rate is 0.53 cents per pound of total sugars. under 4501, LR.C.2 POTATO SITUATION Mr. WHITTEN. The next commodity he mentions is potatoes. I quote: Potato production is vulnerable to extreme price fluctuations resulting from wide variations in production. I recommend the enactment of legislation which will permit potato producers, if they so approve by referendum, to be given acreage allotment and marketing quotas aimed at stabilizing potato prices. What has been the situation-supplywise, marketwise, pricewise— which leads the President to that statement and what is the status of the action to bring about what he has urged? Secretary FREEMAN. The situation has been one of "boom and bust." It has been a very grave situation. I had a report today from a group that went up to Aroostook County, Maine, where the level of mortgages on farm property in this potato area has climbed to such astronomical levels, that no one is foreclosing any mortgages because there isn't enough security left to foreclose on. This is a poverty area where, when you look at the homes and the general facilities it would not seem to be, but they have had 5 years of very low potato prices. Potatoes have been a real problem commodity and in this instance, a very active and conscientious potato advisory committee has been meeting for 3 years. They have largely reached an agreement for a program which would include no price supports, but acreage allotments and marketing quotas to bring about a realistic balance of supply and demand. This legislation is pending in both the House and Senate and has not yet come up for action. Mr. WHITTEN. At this point, I would like to insert in the record the remaining parts of the President's message and would like to have you follow each numbered paragraph with such supporting information as you have, together with any actions that may have been taken or any developments since the message was presented. I think if you will supply that for the record, that will be sufficient. (The remaining text follows:) STRENGTHENING COOPERATIVES 6. Strengthening cooperatives.-Farmers should be encouraged to maintain their position in the marketplace through their own efforts, and to utilize cooperative organizations for this purpose. This has been the declared policy of the Congress for many years, and the extremely large capital investments required in modern farming have increased the need for such cooperatives to furnish harvesting, storing, processing, transporting, and marketing services, as well as electric and telephone services and other consumer needs, as a means of increasing net farm income. New legislation is needed to clarify the right of cooperatives to expand their operations by merger and acquisition. I shall shortly transmit to the Congress, also, legislation to provide additional credit facilities to permit rural cooperatives to assume additional responsibility in the war to combat poverty. (The Department's comments follow:) Cooperatives could contribute much more to the strengthening of farmers' bargaining power if they could consolidate into fewer and stronger organizations with better and more efficient plants and better use of personnel. At present, antitrust laws deter cooperatives from moving aggressively toward strengthening their position by mergers and acquisitions. Merger standards are uncertain at best, and the fact that mergers can be voided legally many years later further complicates the problem. Premerger clearances now avail |