ALCOHOL FUELS.

SEC. 1920. ALCOHOL FUELS. (a) Reduced Rate of Tax on Gasoline Mixed with Alcohol.— Paragraph (1) of section 4081(c) (relating to gasoline mixed with alcohol at refinery, etc.) is amended to read as follows: “(1) In general.— Under regulations prescribed by the Secretary, subsection (a) shall be applied by multiplying the otherwise applicable rate by a fraction the numerator of which is 10 and the denominator of which is— “(A) 9 in the case of 10 percent gasohol, “(B) 9.23 in the case of 7.7 percent gasohol, and “(C) 9.43 in the case of 5.7 percent gasohol, in the case of the removal or entry of any gasoline for use in producing gasohol at the time of such removal or entry. Subject to such terms and conditions as the Secretary may prescribe (including the application of section 4101), the treatment under the preceding sentence also shall apply to use in producing gasohol after the time of such removal or entry.” (b) Conforming Amendments.— Section 4081(c) is amended— (1) by striking “6.1 cents a gallon” in paragraph (2) and inserting “an otherwise applicable rate”, and (2) by striking paragraph (4) and inserting the following new paragraph: “(4) Otherwise applicable rate.— For purposes of this subsection— 106 STAT. 3027 “(A) In general.— In the case of the Highway Trust Fund financing rate, the term ‘otherwise applicable rate’ means— “(i) 6.1 cents a gallon for 10 percent gasohol, “(ii) 7.342 cents a gallon for 7.7 percent gasohol, and “(iii) 8.422 cents a gallon for 5.7 percent gasohol. In the case of gasohol none of the alcohol in which consists of ethanol, clauses (i), (ii), and (iii) shall be applied by substituting ‘5.5 cents’ for ‘6.1 cents’, ‘6.88 cents’ for ‘7.342 cents’, and ‘8.08 cents’ for ‘8.422 cents’. “(B) 10 percent gasohol.— The term ‘10 percent gasohol’ means any mixture of gasoline with alcohol if at least 10 percent of such mixture is alcohol. “(C) 7.7 percent gasohol.— The term ‘7.7 percent gasohol’ means any mixture of gasoline with alcohol if at least 7.7 percent, but not 10 percent or more, of such mixture is alcohol. “(D) 5.7 percent gasohol.— The term ‘5.7 percent gasohol’ means any mixture of gasoline with alcohol if at least 5.7 percent, but not 7.7 percent or more, of such mixture is alcohol.” (c) Effective Date.— The amendments made by this section shall apply to gasoline removed (as defined in section 4082 of the Internal Revenue Code of 1986) or entered after December 31, 1992.