Demand Deposit Securities of the State and Local Government Series (SLGS); Average Marginal Tax Rate and Treasury Administrative Cost, 37918 [05-12867]

Agencies

• Fiscal Service
• DEPARTMENT OF THE TREASURY

[Federal Register Volume 70, Number 125 (Thursday, June 30, 2005)]
[Notices]
[Page 37918]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 05-12867]



Federal Register / Vol. 70, No. 125 / Thursday, June 30, 2005 / 
Notices

[[Page 37918]]


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DEPARTMENT OF THE TREASURY

Fiscal Service


Demand Deposit Securities of the State and Local Government 
Series (SLGS); Average Marginal Tax Rate and Treasury Administrative 
Cost

AGENCY: Bureau of the Public Debt, Fiscal Service, Treasury.

ACTION: Notice of estimated average marginal tax rate and Treasury 
administrative cost for Demand Deposit certificates of indebtedness--
State and Local Government Series.

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SUMMARY: This notice is being published to provide the information 
necessary to apply the interest rate formula for Demand Deposit 
certificates of indebtedness--State and Local Government Series (SLGS) 
(31 CFR Part 344, Subpart C). The factor necessary to convert the 
interest rate to a tax-exempt equivalent (1--the estimated average 
marginal tax rate of purchasers of tax-exempt bonds) is 1-.21 or .79.
    The current Treasury administrative cost is five basis points. 
Treasury is amending this rate and designating the new Treasury 
administrative cost, as of the effective date of this notice, as one 
basis point.
    The final rule, amending the regulations governing SLGS securities, 
which appears elsewhere in this issue of the Federal Register, makes 
provision for the simultaneous publication of this notice (31 CFR 
344.7).

EFFECTIVE DATE: This notice is effective August 15, 2005.

FOR FURTHER INFORMATION CONTACT: Keith Rake, Deputy Assistant 
Commissioner, Office of the Assistant Commissioner for Public Debt 
Accounting, Bureau of the Public Debt, 200 3rd St., P.O. Box 396, 
Parkersburg, WV 26106-0396, (304) 480-5101 (not a toll-free number), or 
by e-mail at opda-sib@bpd.treas.gov or Edward Gronseth, Deputy Chief 
Counsel, Elizabeth Spears, Senior Attorney, or Brian Metz, Attorney-
Adviser, Office of the Chief Counsel, Bureau of the Public Debt, 
Department of the Treasury, P.O. Box 1328, Parkersburg, WV 26106-1328, 
(304) 480-8692 (not a toll-free number).

SUPPLEMENTARY INFORMATION: The Department of the Treasury, under the 
authority of 26 U.S.C. 141 note; 31 U.S.C. 3102-3104 and 3121, offers 
SLGS Demand Deposit certificates of indebtedness. These securities are 
one-day certificates of indebtedness, issued in a minimum amount of 
$1,000, or in any larger amount, with interest accrued and added to the 
principal daily. In the final rule published simultaneously with this 
notice, provision is made to provide by notice the information 
necessary to apply the interest rate formula to the Demand Deposit 
certificates of indebtedness, i.e., the average yield for three-month 
Treasury bills at the most recent auction, multiplied by one minus the 
estimated average marginal tax rate (1-MTR) of purchasers of tax-exempt 
bonds, less the Treasury administrative cost. The factor ``1-MTR'' is 
.79.
    The current Treasury administrative cost is five basis points. 
Treasury is amending this rate and designating the new Treasury 
administrative cost, as of the effective date of this notice, as one 
basis point.
    Both the ``1-MTR'' and the Treasury administrative cost are subject 
to redetermination by the Department of the Treasury. Any future 
changes will be published by notice in the Federal Register.

Donald V. Hammond,
Fiscal Assistant Secretary.
[FR Doc. 05-12867 Filed 6-29-05; 8:45 am]
BILLING CODE 4810-39-P