WAR REVENUE ACT Approved October 3, 1917 (PUBLIC-No. 50-65TH CONGRESS) An Act to provide revenue to defray war expenses, and for other purposes. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, TITLE I.-WAR INCOME TAX. SECTION 1. That in addition to the normal War income tax tax imposed by subdivision (a) of section one of the Act entitled "An Act to increase the revenue, and for other purposes," approved September eighth, nineteen hundred and sixteen, there shall be levied, assessed, collected, and paid a like normal tax of two per centum upon the income of every normal tax of 2% individual, a citizen or resident of the United States, received in the calendar year nineteen hundred and seventeen and every calendar year thereafter. 1. Supplementary on individuals surtax on indi SEC. 2. That in addition to the additional tax 2. Supplementary imposed by subdivision (b) of section one of such viduals Act of September eighth, nineteen hundred and sixteen, there shall be levied, assessed, collected, and paid a like additional tax upon the income of every individual received in the calendar year nineteen hundred and seventeen and every calendar year thereafter, as follows: $5,000 to $7,500 to $10,000 to $12,500 to $15,000 to $20,000 to $40,000 to $60,000 to $80,000 to $100,000 to $150,000 to per annum upon One per centum the amount by which the total net income exceeds $5,000 and does not exceed $7,500; Two per centum per annum upon the amount by which the total net income exceeds $7,500 and does not exceed $10,000; Three per centum per annum upon the amount by which the total net income exceeds $10,000 and does not exceed $12,500; Four per centum per annum upon the amount by which the total net income exceeds $12,500 and does not exceed $15,000; Five per centum per annum upon the amount by which the total net income exceeds $15,000 and does not exceed $20,000; Seven per centum per annum upon the amount by which the total net income exceeds $20,000 and does not exceed $40,000; Ten per centum per annum upon the amount by which the total net income exceeds $40,000 and does not exceed $60,000; Fourteen per centum per annum upon the amount by which the total net income exceeds $60,000 and does not exceed $80,000; Eighteen per centum per annum upon the amount by which the total net income exceeds $80,000 and does not exceed $100,000; Twenty-two per centum per annum upon the amount by which the total net income exceeds $100,000 and does not exceed $150,000; Twenty-five per centum per annum upon the amount by which the total net income exceeds $150,000 and does not exceed $200,000; $250,000-30% Thirty per centum per annum upon the $200,000 to amount by which the total net income exceeds $200,000 and does not exceed $250,000; $250,000 to Thirty-four per centum per annum upon the $300,000-84% amount by which the total net income exceeds $250,000 and does not exceed $300,000; $300,000 to Thirty-seven per centum per annum upon the $500,000-37% amount by which the total net income exceeds $300,000 and does not exceed $500,000; $500,000 to Forty per centum per annum upon the amount $750,000-40% by which the total net income exceeds $500,000 and does not exceed $750,000; $1,000,000-45% Forty-five per centum per annum upon the $1,500,000 amount by which the total net income exceeds $750,000 and does not exceed $1,000,000; $5,000,000-50% Fifty per centum per annum upon the amount $1,000,000 up to by which the total net income exceeds $1,000,000. tax on individuals under act of SEC. 3. That the taxes imposed by sections 3. Computation of one and two of this Act shall be computed, levied, assessed, collected, and paid upon the same basis Basis same as and in the same manner as the similar taxes im- Sept. 8, 1916 posed by section one of such Act of September eighth, nineteen hundred and sixteen, except that in the case of the tax imposed by section one of this Act (a) the exemptions of $3,000 and $4,000 Personal provided in section seven of such Act of September eighth, nineteen hundred and sixteen, as amended by this Act, shall be, respectively, $1,000 and $2,000, and (b) the returns required under Returns subdivisions (b) and (c) of section eight of such Act, as amended by this Act, shall be required in exemptions $1,000 $2,000 the case of net incomes of $1,000 or over, in the case Unmarried person of unmarried persons, and $2,000 or over in the case Married person of married persons, instead of $3,000 or over, as therein provided, and (c) the provisions of subdivision (c) of section nine of such Act, as Withholding on obligations containing a "tax free" clause Does not apply to supplementary war income tax of 2% until Jan. 1, 1918 Only one 2% tax shall be withheld at source 4. Supplementary war income tax on corporations. Rate 4% Basis same as under Act of Sept. 8, 1916 amended by this Act, requiring the normal tax of individuals on income derived from interest to be deducted and withheld at the source of the income shall not apply to the new two per centum normal tax prescribed in section one of this Act until on and after January first, nineteen hundred and eighteen, and thereafter only one two per centum normal tax shall be deducted and withheld at the source under the provisions of such subdivision (c), and any further normal tax for which the recipient of such income is liable under this Act or such Act of September eighth, nineteen hundred and sixteen, as amended by this Act, shall be paid by such recipient. SEC. 4. That in addition to the tax imposed by subdivision (a) of section ten of such Act of September eighth, nineteen hundred and sixteen, as amended by this Act, there shall be levied, assessed, collected, and paid a like tax of four per centum upon the income received in the calendar year nineteen hundred and seventeen and every calendar year thereafter, by every corporation, joint-stock company or association, or insurance company, subject to the tax imposed by that subdivision of that section, except that if it has fixed its own fiscal year, the tax imposed by this section for the fiscal year ending during the calendar year nineteen hundred and seventeen shall be levied, assessed, collected, and paid only on that proportion of its income for such fiscal year which the period between January first, nineteen hundred and seventeen, and the end of such fiscal year bears to the whole of such fiscal year. The tax imposed by this section shall be computed, levied, assessed, collected, and paid upon the same incomes and in the same manner as the tax imposed by subdivision (a) of section ten of such Act of September eighth, nineteen hundred and may be credited to tion sixteen, as amended by this Act, except that for Exception the purpose of the tax imposed by this section the income embraced in a return of a corporation, Dividends received joint-stock company or association, or insurance income of corporacompany, shall be credited with the amount received as dividends upon the stock or from the net earnings of any other corporation, joint-stock company or association, or insurance company, which is taxable upon its net income as provided in this title. SEC. 5. That the provisions of this title shall not extend to Porto Rico or the Philippine Islands, and the Porto Rican or Philippine Legislature shall have power by due enactment to amend, alter, modify, or repeal the income tax laws in force in Porto Rico or the Philippine Islands, respectively. TITLE II.-WAR EXCESS PROFITS TAX. Porto Rico and Philippines-war income tax does not apply to War excess 1. Definitions "Corporation" The term "domestic" means created under the law of the United States, or of any State, Territory, "Domestic" or District thereof, and the term "foreign" means created under the law of any other possession of the United States or of any foreign country or government; "Foreign" The term "United States" means only the "United States" states, the territories of Alaska and Hawaii, and the District of Columbia; "Taxable year" "Fiscal year" The term "taxable year" means the twelve months ending December thirty-first, excepting in the case of a corporation or partnership which has fixed its own fiscal year, in which case it means such fiscal year. The first taxable year shall be the year year" ending December thirty-first, nineteen hundred and seventeen, except that in the case of a corporation "First taxable |