SECTION 3231.-DEFINITIONS [RAILROAD RETIREMENT TAX ACT] 26 CFR 31.3231(e)-1: Compensation. Amount received from employer in settlement of injuries sustained a portion of which was credited to "time lost." See Rev. Rul. 61–1, TITLE 26-INTERNAL REVENUE, 1954.-CHAPTER I, SUBCHAPTER D, PART 48.— MANUFACTURERS AND RETAILERS EXCISE TAXES Regulations under sections 4001, 4002, 4003, 4011, 4012, 4013, 4021, 4022, and 4031 of the Internal Revenue Code of 1954, as amended, relating to the tax on the sale of jewelry and related items, furs, toilet preparations, and luggage, handbags, etc. OFFICE OF COMMISSIONER OF INTERNAL REVENUE, To Officers and Employees of the Internal Revenue Service and On July 22, 1960, notice of proposed rulemaking with respect to the Manufacturers and Retailers Excise Tax Regulations (26 CFR Part 48) under subchapters A, B, C, and D of Chapter 31 of the In- ternal Revenue Code of 1954, as amended, relating to retailers excise taxes on jewelry and related items, furs, toilet preparations, and lug- gage, handbags, etc., was published in the Federal Register (25 F.Ř. 6974). After consideration of all such relevant matter as was pre- sented by interested persons regarding the rules proposed, the follow- The regulations hereby prescribed are applicable to sales of the articles referred to therein made on or after January 1, 1959, except 1 The publication of this Treasury Decision in 25 F.R. 12669, dated December 10, 1960, contains (1) instructions for modifying the notice of proposed rulemaking in 25 F.R. 6974, dated July 22, 1960, and (2) the full context of the regulations with such modi- fications. As here published, the Treasury Decision reflects the full context of such regulations, with modifications. The individual instructions have been omitted. 48.4001-3 Certain real or synthetic stones. 48.4001-4 Articles made of, or ornamented, mounted or fitted with, precious Subpart B.-Jewelry and Related Items § 48.4001 STATUTORY PROVISIONS; IMPOSITION OF TAX. SEC. 4001. IMPOSITION OF TAX. There is hereby imposed upon the following articles sold at retail a tax equivalent to 10 percent of the price for which so sold: All articles commonly or commercially known as jewelry, whether real or imitation. The following stones, by whatever name called, whether real or synthetic: Amber Articles made of, or ornamented, mounted or fitted with precious metals or imitations thereof. Watches. Clocks. Cases and movements for watches and clocks. Gold, gold-plated, silver, or sterling flatware or hollow ware and silver-plated hollow ware. Opera glasses. Lorgnettes. Marine glasses. Field glasses. Binoculars. [Sec. 4001 as amended and in effect Jan. 1, 1959, and as amended by sec. 1, Act of Sept. 21, 1959 (Pub. Law 86-344, 73 Stat. 617) [C.B. 1959-2 700]] § 48.4001-1 IMPOSITION OF TAX.-(a) In general.-Section 4001 imposes a tax upon the following articles sold at retail: (1) Articles commonly or commercially known as jewelry, whether real or imitation; (2) Certain real or synthetic stones listed in § 48.4001-3 (a); (3) Articles made of, or ornamented, mounted or fitted with, precious metals or imitations thereof; and (4) Watches and clocks and cases and movements therefor; gold, gold-plated, silver, or sterling flatware or hollow ware; silver-plated hollow ware; opera glasses; lorgnettes; marine glasses; field glasses; and binoculars. (b) Cross references.-For provisions relating to the specific articles taxable under section 4001, see the following regulations in this. subpart: (1) Section 48.4001-2 for jewelry; (2) Section 48.4001-3 for certain real or synthetic stones; (3) Section 48.4001-4 for articles made of, or ornamented, mounted or fitted with, precious metals or imitations thereof; (4) Section 48.4001-5 for watches and clocks, etc.; (5) Section 48.4001-6 for gold, gold-plated, silver, or sterling flatware or hollow ware, and silver-plated hollow ware; and (6) Section 48.4001-7 for opera glasses, lorgnettes, marine glasses, field glasses, and binoculars. (c) Rate of tax.-The tax is imposed at the rate of 10 percent of the price for which the taxable article is sold at retail. For definition of the term "price", see section 4051 and the regulations thereunder contained in Subpart G. (d) Liability for tax.-The tax is payable by the person who sells at retail any article subject to tax under section 4001. For tax applicable to leases, see section 4052 and the regulations thereunder contained in Subpart G. (e) Sales by United States.-For provisions relating to sales at retail made by the United States, its agencies or instrumentalities, see section 4054 and the regulations thereunder contained in Subpart G. 48.4001-2 JEWELRY.-(a) Generally.-Jewelry in general includes articles designed to be worn on the person or on apparel for the purpose of adornment and which in accordance with custom or ordinary usage are worn so as to be displayed, such as rings, chains, brooches, bracelets, cuff buttons, necklaces, earrings, beads, charms, pendants, etc. The tax is imposed on the sale of any of such articles at retail, regardless of the substance of which made and without. reference to their utilitarian value or purpose, unless for a purpose specifically exempted by law. It is immaterial whether the articles taxable under this paragraph are real or imitation jewelry. Thus, articles constituting costume jewerly are subject to tax regardless of the material of which they are made. (b) Articles made of, or ornamented with, certain stones.-Jewelry also includes articles to be carried in the hand, or hung on the arm, or carried or worn on the person, whether in pocket or bag or under the outer garments, such as cigarette cases, pocket mechanical lighters for cigarettes, cigars, and pipes, eyeglass cases, pencils, powder boxes, garter buckles, canes, purses or handbags, if made of, or ornamented, mounted or fitted with, any of the stones enumerated in section 4001 whether such stones are real or synthetic. Such articles are likewise subject to tax without regard to their utilitarian value or purpose. Mother-of-pearl is not a real or synthetic pearl; therefore, articles not otherwise subject to the tax are not made taxable by reason of their ornamentation with mother-of-pearl. See also § 48.4001-4 as to the taxability of the sale at retail of articles made of, or ornamented, mounted or fitted with, precious metals or imitations thereof, and section 4031, and the regulations thereunder contained in Subpart E, relating to the taxability of the sale at retail of purses, handbags, pocketbooks, etc. (c) Credit or refund of manufacturers excise tax. See section 6416(d) and the regulations thereunder contained in Subpart O for credit or refund of the manufacturers excise tax paid under section 4201 on mechanical pencils, fountain and ball point pens, and mechanical lighters for cigarettes, cigars, and pipes, in the case where because of further manufacture the tax imposed by section 4001 applies to the sale of such articles at retail. § 48.4001-3 CERTAIN REAL OR SYNTHETIC STONES.-(a) Real stones. (1) In general. The tax imposed by section 4001 applies to sales at retail of the following stones, by whatever name called: Amber |