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JUN 1 * 1972
TREASURY department
war purposes*
S i l v e r c o i n a g e has
as a r e s u l t o f
the war.
quantities
can no
been
of si l v e r because
Morgenthau
f a l l i n g off,
imported
copper and
supply
65
s i l v e r has
a year being
inadequate
for the
eager f or the metal,
cents
an
ounce in Mexico
the diversion of the foreign s ilver
B o a r d has
ILLcenaed i m p o r t e r s .
-
{Another orderV ^ e f f e c t i v e
s¡ilver
ilv
from
issued an order restrict—
eii a b r o a d to
-j t
foreign
ounces
silversmiths,
to 60 a n d
t h e \»ar P r o d u c t i o n
^
other scarce metals
of foreign
and Canada are
have bid up the price
To p r e v e n t
are also using larger
and the 100,000,000
American
countries
base for s i l v e r - p l a t e d ware.
s a i d the
from Mexico
p r e s e n t demand.
use s,
Silversmiths
longer be u s e d as a
Mr.
i n c r e a s e d in m a n y
to
October
1,
restricts
high priority purposes.
the use of
*
c J l* 0
The
price
for newly-mined domestic
freight
71•11
Office of Price Administration has
charges
cents an
jjmvn'i \.A
ounce
Treasur^Pan~la^ed
to
45
,c o m p a r e d t o
f i x e d b y law,
'‘f o r - . a u c h ^ s i l v e r to g o
®B8By
s i l v e r at
an
cent^plus
thus m aking it
instead
o
—
of the
to f o r e i g n s h i p p e r s ,
recently raised the ceiling price
cents
71.11
t he c e i l i n g
the T r e a s u r y p r i c e
to m a n u f a c t u r e r s
inducement
set
o u n c e in c o n t r a s t t o
the
t h e T r e a s u r y j u m a i n t a i n ^ f ^ l ^ e ^ ^ y i , ,,
on f o r e i g n s i l v e r
55
cent level which
^ j ....
m
,,
____ r e v d a i e d t o d a y t h a t t h e T r e a s u r y
is ¡ a l r e a d y d e l i v e r i n g
ounces
large quantities
of the 1,350/000,000
o f s i l v e r b e i n g m a d e a v a i l a b l e t o t h e D e f e n s e Planjc
Corporation,
which will release
4 0 , 0 0 0 tons
offc o p p e r
forj
u r g e n t war uses.
The metal will
he e m p l o y e d b y t h e Bfefense P l a n t Cor-j
pjoration i n p l a n t s p r o d
w i l l be r e t u r n e d t o
Mr.
Morgenthau
i n g ajluminujn a n d m a g n e s i u m ,
the T r e
fter t h e
said t h e J & ^ e a s u r y has
and
war.
made
every effort
Af
oJfâiæ-^âîT si 1 v e r %vailaj^ ¿ D p
Purchases
¡1941,
he
of f o r e i g n ^ i l v e r have b e d ^ ^ a d e
said,
postponed,
No
new
since November^
a n c K t h e (deliveryiof n e w l ^ r m i n e d
Isilver h a s V / m
I go
irgent w a r u s e s .
domestic
tqus p e r m i t t i n g N ^ u c h silver to
into in d u s t r i a l uses.
e T r e a s u r y has
I sil v e r of w h i c h
stocks
of 2,900,000,u0u
1 , 550,000,000
ounces
ounces
of
h a ^ b e e n m o n e t i s e d axid
¿xAiijm a r e s e r v e a g a i n s t s i l v e r c e r t i f i c a t e s . T h e b a l a n c e
/ s t i t u t e s " f r e e ” s i l v e r a l l o f w h i c h is b e i n g p u t i n t o i n f
J d u s t r i a l u s e f o r w a r p u r p os e ^ .
Until recently,
smiths
could meet all
ver at
a b o u t 35
there has
of th e i r needs
cents an
been an
industries.
Secretary Morgenthau
ounce.
enormous
The met a l
duction of aircraft,
said,
by buying
However,
\
l
|
silver
foreign sil
in t h e p a s t y e a r
increase.in the use of silver in
is u s e d
ordnance,
e x t e n s i v e l y in t h e p r o
naval
vessels,
and
for other
O
a id
making every
war
to put
that
all a v a i l a b l e
the
Treasury
silver
into
is
urgent
uses.
The
silver
and
effort
today
Treasury
a reserve
constitutes
stocks
of 2,900, 0 0 0 , 0 0 0
1 ,550,000,000
of w h i c h
are
has
against
" f r e e ” silver,
ounces
silver
ounces
of
have b e e n monetized
certificat
a l l of w h i c h
is
K
-mtmhmmm*®®** w a r
.¿fmr t
tons
of c o p p e r
for w a r
Substantial
being
delivered
plants where
release
4,0,000
uses.
quantities
to w a r
it w i l l
of
plants
this
free
producing
silver
are
already
a l m m i n u m and
magnesium.
No new purchases
November,
194-1, Nr.
newly-mined
purchase
domestic
contract
silver
to go
i nto
silver
refiners
of foreign silver
M o rgent ha u said,
and the delivery
s i l v e r urn a c q u i r e d
has b e e n p o s t p o n e d ,
industrial
are a l r e a d y
have be e n made
Two
taking advantage
postponement and are d e l ivering newly
to
iflram i n d u s t r i a l u sess.
of
under forward
thus permitting
uses. -■" >©
since
mined
of
such
the largest
o * this
domestic
silver
TREASURY DEPARTMENT
Washington
F O R R E L E A S E , MORNING- N E W S P A P E R S
M o n d a y , A u g u s t 31 > 19*+2__________
Press
No.
g/ 2 9 / 4 2
Secretary Morgenthau
ing
every
effort
to p u t
said
today
all a v a i l a b l e
that
the T r e a s u r y
silver
Service
33-0
is m a k
into u r g e n t
war
uses.
T h e T r e a s u r y h a s s t o c k s of 2 , 9 0 0 , 0 0 0 , 0 0 0 o u n c e s of s i l v e r
of w h i c h 1 ,550,000,000 o u n c e s h a v e b e e n m o n e t i z e d a n d a r e a
reserve against silver certificates.
The b a l a n c e c o n s t i t u t e s
" f r e e 11 s ilver, all of w h i c h is b e i n g l e n d - l e a s e d f o r u s e in
w a r p l a n t s w h e r e it w i l l r e l e a s e *+0,000 t e n s of c o p p e r f o r w a r
uses.
S u b s t a n t i a l a u a n t i t i e s of t h i s f r e e s i l v e r a r e a l r e a d y
b e i n g d e l i v e r e d to w a r p l a n t s p r o d u c i n g a l u m i n u m a n d m a g n e s i u m .
No n e w p u r c h a s e s of f o r e i g n s i l v e r h a v e b e e n m a d e s i n c e
N o v e m b e r , 1941, Mr. M o r g e n t h a u said, a n d t h e d e l i v e r y of n e w l y mined domestic silver acquired under forward purchase contract
h a s b e e n p o s t p o n e d , t h u s p e r m i t t i n g s u c h s i l v e r to go i n t o i n
dustrial use s ’
. T w o of the l a r g e s t s i l v e r r e f i n e r s a r e a l r e a d y
t a k i n g a d v a n t a g e o f t h i s p o s t p o n e m e n t a n d are d e l i v e r i n g n e w l y m i n e d d o m e s t i c s i l v e r to i n d u s t r i a l u s e r s .
U n t i l r e c e n t l y , S e c r e t a r y M o r g e n t h a u said, s i l v e r s m i t h s
c o u l d m e e t a l l of t h e i r n e e d s b y b u y i n g f o r e i g n s i l v e r at a b o u t
35 c e n t s a n o u n c e .
H o w e v e r , in t he p a s t y e a r t h e r e h a s b e e n
an e n o r m o u s i n c r e a s e in the u s e of s i l v e r in industries'.
The
m e t a l is u s e d e x t e n s i v e l y in t h e p r o d u c t i o n of a i r c r a f t , o r d
n a n ce, n a v a l v e s s e l s , a n d f o r o t h e r w a r p u r p o s e s .
Silver
c o i n a g e h a s i n c r e a s e d in m a n y c o u n t r i e s as a r e s u l t of t h e
war.
S i l v e r s m i t h s are a l s o u s i n g l a r g e r q u a n t i t i e s of s i l v e r
b e c a u s e c o p p e r a n d o t h e r s c a r c e m e t a l s c a n no l o n g e r b e u s e d
as a b a s e f o r s i l v e r - p l a t e d w a r e .
Mr. M o r g e n t h a u s a i d t h e s u p p l y of f o r e i g n s i l v e r h a s b e e n
f a l l i n g off, a n d the 100,000,000 o u n c e s a y e a r b e i n g i m p o r t e d
f r o m M e x i c o a n d O a n a d a a re i n a d e q u a t e for t h e p r e s e n t d e m a n d .
A m e r i c a n s i l v e r s m i t h s , e a g e r f o r the m etal, h a v e b i d u p t h e
p r i c e to 6 0 a n d 65 c e n t s a n o u n c e in M e x i c o .
To p r e v e n t the
d i v e r s i o n of t h e f o r e i g n s i l v e r f r o m h i g h p r i o r i t y u ses, the
W a r P r o d u c t i o n B o a r d h a s i s s u e d an o r d e r r e s t r i c t i n g the
p u r c h a s e o f s i l v e r a b r o a d to licensed. I m p o r t e r s .
2
As an added Inducement to f o r e i g n shippers, the O f f i c e
of P r i c e A d m i n i s t r a t i o n r e c e n t l y r a i s e d t h e c e i l i n g p r i c e on
f o r e i g n s i l v e r to %
c e n t s an o u n c e in c o n t r a s t to the 35
cent l e v e l w h i c h the T r e a s u r y m a i n t a i n s .
A n o t h e r o r d e r of t h e W a r P r o d u c t i o n B o a r d , e f f e c t i v e
r e s t r i c t s t h e u s e of f o r e i g n s i l v e r to h i g h p r i o r
October 1 ,
ity p u r p o s e s .
T h e O f f i c e of P r i c e A d m i n i s t r a t i o n h a s a l s o set t h e c e i l
ino* p r i c e f o r newly-minedi d o m e s t i c s i l v e r at ? 1 * H c e n t s an
o u n c e p l u s f r e i g h t c h a r g e s , c o m p a r e d to t h e T r e a s u r y p r i c e or
7 1 . 1 1 c e n t s an o u n c e f i x e d b y law, t h u s m a k i n g it m o r e
a b l e f o r s u c h s i l v e r to go to m a n u f a c t u r e r s i n s t e a d of the
Treasury.
cOc-
TREASURY DEPARTMENT
Washington
FOR RELEASE, MORNING NEWSPAPERS,
Monday, August 31« 194-2_________
Press Service
N o . 33-1
8/ 30/42
The attitude of the Treasury Department on the "pay as you go"
income tax plan of Beardsley Ruml, Chairman of the Federal Reserve Bank
of New York, will be explained to the public over the radio tonight
(Monday, August 31) *
Randolph Paul, General Counsel of the Treasury, and Chief Tax
Adviser to Secretary Morgenthau, will reply to Mr. Ruml in an address
over the Mutual Network tonight from 9:1$ to 9:30 P.M.
On station WOR,
New York, this broadcast will be heard at 10:45 P«M.
Mr. Paul's talk will be in answer to the address which Mr. Ruml
made over the same network (Mutual) last Friday night.
■oOo-
-
square.
11
-
In our American vocabulary, the phrase is
fair and square.1* It is our deep conviction at
the Treasury that the Ruml plan is not fair and
square.
Until it can be mode i^^p, we at the Treasury
will not take the responsibility of recommending it
to the Congress and to the taxpayers of America.
D-B 8/31
-
10
-
We have already suggested to the Senate Finance
Committee a plan whereby the pay-as-you-go principle would
be applied to all normal taxes and to the first bracket
of surtaxes.
This would put at least
payers on a current basis.
80% of
our tax
But the plan as Mr. Ruml
proposed it, is not acceptable for the three reasons
which I have outlined.
It is a very complicated scheme;
it would not, in fact, put the taxpayers on a current basis,
and it involves forgiving a yearTs tax liability, with
the greatest benefit going to those of the biggest
incomes•
It is an attractive idea to get square with Uncle Sam;
Mr. Ruml himself has made great use of that word "square"
in arguing for his plan.» But it is not enough to be
(^X_
7
- 9 to collect the basic part of the tax at the source,
that is, to withhold it from wages, salaries, interest and
dividends.
The difficulty in the way of putting such
a plan into full operation has lain in the fact that
it would involve a double payment of tax liabilities in
the same year, first the tax on last year's income,
and second the tax on this year's income which would be
withheld at the source.
The Ruml plan points a way
by which this difficulty can be eliminated.
It would
make it possible for us to introduce now a comprehensive
system of collection at the source which would, in fact,
put the great majority of our taxpayers on a current
basis, with the tax collected week by week from their
incomes as they receive it.
It is true that taxpayers would keep on paying year
after year under the Ruml plan, and the loss of revenue
would not actually appear until a taxpayers income
declined or until he died.
But it is undeniably true
that over a period of years the Ruml plan involves giving
away a sum of billions of dollars, and giving it largely
to the wealthy taxpayers whcj need it least.
It is not
surprising, therefore, that it has been energetically
pushed by those who benefited by some of 1941 fs better
than usual incomes.
With the basic purpose of the Ruml plan the
Treasury has much sympathy.
It would be fine if a
substantial part of our income tax liability could be
put on a current basis.
The easiest way to do this is
last year than they are apt .to do now with the impact
of rationing, growing scarcities, higher taxes, and
other effects of the war.
Under Mr. Ruml's plan
such individuals would pay no tax on their 1941
earnings at all.
The man who got huge commissions for
placing war contracts in 1941 would pay no tax at all.
The man who profited by manufacturing as many civilian
goods as the traffic would bear would pay no tax at all.
Anyone who had a large income for 1941 ■
—
and that goes
for thousands, if not millions, of people —
would get
a wholly fortuitous tax windfall.
This hardly seems to be treating everyone alike.
It is instead the passing out of huge benefits to
those who need them least, and at a time when we must
be getting more revenue instead of giving it away.
billions of dollars of tax liability are cancelled.
That is a somewhat surprising way to raise tax revenue
in wartime.
And what is the result of treating all alike?
From eighty to ninety percent of the taxpayers have
incomes below $3,000, and they would be forgiven from
a few dollars up to a maximum of two or three hundred
dollars each.
But the wealthy man with an income of
half a million dollars would save a tax liability of
more than $350,000.
If 1941 were a normal year the plan would be bad
enough, but 1941 was not a normal year in any sense
of the word.
It was a year in which our factories made
more shiny new cars, more bright gadgets of all kinds,
more goods for consumer use than in any year in our
history.
Individuals made a great deal more money
^
- 5 -
a $10,000 income.
His tax payments for that year would
in fact exceed his total income for that year, and his
problem would be a very serious if not impossible one.
The Ruml plan does not in fact achieve its basic
purpose to put the income tax on a current basis; its
seductive allure is in fact an illusion.
Why, then, has the Ruml plan been so earnestly
advanced and so assiduously pushed forward?
We can
find much of the reason when we turn to consider the
Treasury's third objection to the scheme.
It is an
essential part of the Ruml plan that one year's taxes
be forgiven.
It is said that this treats everyone alike;
everyone is given a clean elate for 1941.
see how this works out.
But let us
In the first place several
- 4 -
Another objection is the fact that the Rumi
plan, despite its label as the pay-as-you-go tax plan,
would not in fact put taxpayers current with their
tax liability to the Government.
Many taxpayers
experience considerable fluctuations in their annual
incomes.
In their cases thejRuml plan would not be
a pay-as-you-go plan at all.
Let's take the case of
a man who ordinarily makes about $3,000 a year, but
who puts through a successful deal in one year so that
he makes $10,000.
Under the Ruml plan he would pay on
a $3,000 income in the year he had $10,000, and then in
the following year when he had an income of $3,000
again, he would have to pay a deficiency on his last
year»s tax, and then pay currently on the basis of
- 3 The description I have just given illustrates some
of the Treasury1s objections to the Ruml plan.
first place it is extremely complicated.
In the
Each year’s
tax payments will depend upon two returns instead of
one as at present.
The taxpayer will first file a
return of one year’s income which will be the tentative
return for the following year.
He will pay tax according
to tKis return, and then when the year is ended he will have
to file another return showing what his income actually was,
and he will then have to make a further payment or collect
a refund depending on how his income varied.
The
administrative problems for the Government in collecting
these additional payments and in making a large number of
refunds would be very great, and the system would
certainly be very confusing for many taxpayers.
t^ '^ 1
I
-
2
-
liability for the year 1941 will be simply forgiven
by the Government.
The payments which have been made
during this year 1942 for that year’s tax will instead
be treated as current payments on 1942 tax liability.
course 1942 income will not ordinarily be the same as
1941 income, so when March 1943 comes around, each
taxpayer will file a return for 1942 showing what his
actual 1942 income was.
If it was more than the amount
his payments covered, he will then pay the difference
in tax.
If it was in fact less, he will be entitled
to a refund.
And his return of 1942 income will also
be treated as a tentative return for 1943 which will
determine his advance or current payments of 1943 tax
liability.
Of
DRAFT OF RANDOLPH PAUL’S BROADCAST
ON THE RUML PLAN, AUGUST 31, 1942.
^
3 '
Last Friday you may have heard over this network
a discussion of thè so-called pay-as-you-go tax plan
/
by its sponsor, Mr. Beardsley Rumi.
There is no doubt
that the plan he has advanced is original and ingenious.
The Treasury has considered it earnestly and with the
great respect to which it is entitled, both on the
merits and because of the high standing of its author.
But that consideration has not led us to the conclusion
that the plan should be adopted.
I should like to
outline to you tonight the reasons why the Treasury
does not like the plan.
Mr. Rumi proposes to put all taxpayers on a current
basis by skipping a year's tax.
Under his plan the tax /
TREASURY DEPARTMENT
Washington
dor r e l e a s e , morning newspapers
Tuesday, September 1, 19*42_____
S/31/U2
Press Service
No. 33-2
The following address by Randolph E. Paul,
General Counsel for the Treasury Department,
is scheduled to he broadcast over the Mutual
Network at 9*15 P* m -» Eastern War Time,
Monday, August 31» 19*4-2.
Last Erida.y you may have heard over this network a discussion of the
so-called pay—as—you—go tax plan by its sponsor, Mr* Beardsley Ruml* There
is no doubt that the plan he has advanced is original and ingenious. The
Treasury has considered it earnestly and with the great respect to which
it is entitled, both on the merits and because of the high standing of its
author. But that consideration has not led us to the conclusion that the
plan should be adopted. I should like to outline to you tonight the reasons
why the Treasury does not like the plan*
Mr. Ruml proposes to plit all taxpayers on a current basis by skipping
a year‘s tax. Under his plan the tax liability for the year 19*41 will be
simply forgiven by the Government. The payments which have been made
during this year 19*42 for that year1s tax will instead be treated as current
payments on 19*42 tax liability. Of course 19*42 income will not ordinarily
be the same as 19*41 income, so when March 19*43 comes around, each taxpayer
will file a return for 19*42 showing what his actual 19*42 income was. If
it was more than the amount his .payments covered, he will then pay the
difference in tax. If it was in fact less, he will be entitled to a refund.
And his return of 19*42 income will also be treated as a tentative return
for 19U 3 which will determine his advance or current payments of 19*4-3 ^ax
liability*
The description I have just given illustrates some of the Treasury*s
objections to the Ruml plan. In the first place it is extremely complicated.
Each year*s tax payments will depend upon two returns instead of one as at
present. The taxpayer will first file a return of one year*s income which
will be the tentative return for the following year. He will pay tax
according to this return, and then when the year is ended he will have to
file another return showing what his income actually was, and he will then
have to make a further p a y a n t or collect a refund depending on how his
income varied. The administrative problems for the Government in collecting
these additional payments and in making a large number of refunds would be
very great, and the system would certainly be very confusing for many tax
payers.
Another objection is the fact that the Ruml plan, despite its label
as the pay-as-you-go tax plan, would not in fact put taxpayers current
with their tax liability to the Government. Many taxpayers experience
considerable fluctuations in their annual incomes. In their cases the
Emnl plan would not "be a pay-as-you-go plan at all. Bet’s take the case
of a man who ordinarily makes about $3»000 a yeart but who puts through
a successful deal in one year so that he makes $10,000. Under the Euml
plan he would pay on a $3,000 income in the year he had $10,000, and then
in the following year when he had an income of $3,000 a.gain, he would have
to pay a deficiency on his last year’s tax, and then pay currently on the
basis of a $10,000 income. His tax payments for that year would in fact
exceed his total income for that year, and his problem would be a very
serious if not impossible one. The Euml plan does not in fact achieve its
basic purpose to put the income tax on a current basis; its seductive allure
is in fact an illusion.
,
Why, then, has the Euml plan been so earnestly advanced and so
assiduously pushed forward? We can find much of the reason when we turn
to consider the Treasury’s third objection to the scheme. It is an
essential part of the Euml plan that one year’s taxes be forgiven. It
is said that this treats everyone alike; everyone is given a clean slate
for 19Ul. But let us see how this works out. In the first place several
billions of dollars of tax liability are cancelled, That is a somewhat
surprising way to raise tax revenue in wartime. And what is the result
of treating all alike? Prom eighty to ninety percent of the taxpayers
have incomes below $3,000, and they would be forgiven from a few dollars
up to a maximum of two or three hundred dollars each. But the wealthy
man with an income of half a million dollars would save a tax liability
of more than $350,000.
If l9Hl were a normal year the plan would be bad enough, but 19*41
was not a normal year in any sense of the word. It was a year in which
our factories made more shiny new cars, more bright gadgets of all kinds,
more goods for consumer use than in any year in our history. Individuals
made a great deal more money last year than they are apt to do now with
the impact of rationing, growing scarcities, higher taxes, and other
effects of the war. Under Mr. Euml’s plan such individuals would pay no
tax on their 19*41 earnings at all. The man who got huge commissions for^
placing war contracts in 19*41 would pay no tax at all. The man who profited
by manufacturing as many civilian goods as the traffic would bear would
pay no tax at all. Anyone who had a large income for 19*4-1* — and that goes
for thousands, if not millions, of people — would get a wholly fortuitous
tax windfall.
This hardly seems to be treating everyone alike. It is instead the
passing out of huge benefits to those who need them least, and at a time
when we must be getting more revenue instead of giving it away.
It is true that taxpayers would keep on paying year after year under
the Euml plan, and the loss of revenue would not actually appear until a
taxpayer’s income declined or until he died. But it is undeniably true
that over a period of years the Euml plan involves giving away a sum of
billions of dollars, and giving it largely to the wealthy taxpayers who
r3 ~
need it least. It is not surprising, therefore, that it has "been energetically
pushed by those who benefited by some of 19*41** better than usual incomes.
With the basic purpose of the Ruml plan the Treasury has much sympathy.
It would be fine if a substantial part of our income tax liability could
be put on a current basis.
The easiest way to do this is to collect the
basic part of the tax at the source, that is, to withhold it from wag ,
salaries, interest and dividends.
The difficulty in the way of putting such
a nlan into full operation has lain in the fact that it would involve a
double payment of tax liabilities in the same year, first tne tax on last
year1s income, and second the tax on this year’s income which wouid be
withheld at the source. The Ruml plan points a way by which this difficul y
can be eliminated.
It would make it possible for us to introduce now a
comprehensive system of collection at the source which w o u U , in
the great majority of our taxpayers on a current basis, with the tax collected
week by week from their incomer as they receive it.
We have already suggested to the Senate Finance Committee a plan whereby
the pay-as-you-go principle would he applied to all normal taxes and to th
first bracket of surtaxes. This would put at least eighty percent o f o u r
taxpayers on a current basis. But the plan as Mr. Buml proposed it, is not
acceptable for the three reasons which I have outlined.
It is a very com
^
plicated scheme; it would not, in fact, put the taxpayers on a current iasis,
^ d It involves forgiving a year's tax liability, with the greatest benefit
going to those of the biggest incomes.
It is an attractive idea to get square with Uncle S a w Mr. Buml himself
has made great use of that word "square" in arguing for his plan. But it
is not
to be square. In our American vocabulary, the phrase is
" f a i r and sq u are".
It i s our deep c o n v ic tio n a t A J ^ ^ T a t
Plan i s not f a i r and square.
the T r e a w r y
U n til i t can be made f a i r , we a t the T reasu ry
will not take the responsibility of recommending it to the Congress and to
the taxpayers of America..
TREASURY DEPARTMENT
Washington
FOR RELEASE, MORNING- NEWSPAPERS,
Press Service
s
n°a
v
The total assets of national "banks on June 30 of this year amounted to
nearly $^5»000,000,000, it was announced today "by Comptroller of the Currency
Preston Delano.
Returns from the call covered the 5,107 active national "banks
in the United States and possessions.
The assets reported were greater "by
$1,662,000,000 than those reported "by the 5,115 national "banks on April U,
19^ 2,
the date of the previous call, and showed an increase of $3,8UU,000,000 over tte
amount reported by the 5*136 active banks on June
30, I9H1 .
Loans and discounts as of the current call date were $10,902,000,000, a de
crease of $667,000,000 since April I9U 2 and a decrease of $20,000,000 since June
of last year.
The deposits totaled $Ho,659»000,000, excluding reciprocal interbank demand
deposits of $^39*000,000.
The banks were required to report reciprocal bank
balances on a net basis in response to the call for June
since 1921.
30, I9U 2,
the first time
The amounts of such balances in the interim, however, are not avail-
,.
. .
..
_ ,
in deposits
able, but on a comparative basis the recent figures show increasesykln the three
and twelve month periods of $1,621,000,000 and $3,7^7,000,000, respectively. The
deposits consisted of demand and time deposits of individuals, partnerships and
corporations of $21,9^5,000,000 and $7,SUl,000,000, respectively, United States
Government deposits of $1,175*000,000, deposits of States and political subdivi
sions of $2,7^ 2,000,000, postal savings of $ 1^,000,000, certified and cashiers'
checks, cash letters of credit and travelers' checks outstanding of $1^
3,000,000,
and deposits of banks, excluding reciprocal balances, of $6,^99,000,000.
Investments by the banks in United States Government obligations, direct and
guaranteed, as of June 30, 19^2, aggregating $lH,929,000,000, were $2,1^7,000,000
TREASURY DEPARTMENT
Washington
FOR RELEASE, MORN TNG- NEWSPAPERS,
W e d nesday, September 2, 1942.
Press Service
No. 3 3 -3
The total assets of national banks on June 3 0 of this year
amounted to nearly $45,000,000,000, it was announced today by
Comptroller of the Currency Preston Delano.
Returns from the
call covered the 5,107 active national banks in the United
States and possessions.
The assets reported were greater by
11.662.000. 000 than those reported by the 5 ,1 1 5 national banks
on April
19*4-2, the date of the previous call, and showed
an Increase of $3,344,000,000 over the amount reported by the
5 ,1 3 6 active banks on June 3 0 , 1941.
Loans and discounts as of the current call date were
110.902.000. 000, a decrease of $6 6 7 ,000,000 since April 19*4-2
and a decrease of $20,000,000 since June of last year.
The deposits totaled $40,659,000,000, excluding reciprocal
interbank demand deposits of $439»000,000. The banks were re
quired to report reciprocal bank balances on a net basis in
response to the call for June 30* 1942, the first time since
1921, The amounts of such balances in the Interim, however,
are not available but on a comparative basis the recent fig
ures show increases in deposits in the three and twelve month
periods of $1,621,000,000‘and $3,747,000,000, respectively.
The deposits consisted of demand and time deposits of indi
viduals, partnerships and corporations of $21,945,000,000 and
$7,^41,000,000, respectively, United States Government deposits
of $1,175,000,000, deposits of States and political subdivisions
of $2,742,000,000, postal savings of $14,000,000, certified and
cashiers’ checks, cash letters of credit and travelers' checks
outstanding of $443,000,000. and deposits of banks, excluding
reciprocal balances, of $6,499>000,000,
Investments by the banks in United States
gations, direct and guaranteed, as of June 30 ,
$14,929,000,000, were $2,147,000,000 more than
and $3,793,000,000 more than the amount held a
Government obli
1942, aggregating
in April 1942,
year previous.
2
The direct and indirect obligations held on June 3° last were
I n , 300,000,000 and $1,629,000,000, respectively. Other bonds,
stocks and securities held totaling $3 ,7 1 ^,000 ,000 , including
obligations of States and political subdivisions of
$1 9 6 1 ,000 ,000 , showed decreases in the three and twelve month
periods of $ 1 2 9 ,000,000 and $ 10 ^,000 ,000 , respectively.
Cash of $722,000,000, balances with other banks, excluding
reciprocal balances, of $6,099,000,000» and reserve with Federal
Reserve banks of $7,^9,000,000, a total of <¿1^-,
creased $3^5,000,000 since April of this year and $234,000,000
since June 19^1.
Bills payable, rediscounts and other liabilities for bor
rowed money of $ 2 ,000,000 showed a decrease of $1 0 ,000,000 since
April, but was about the same as in June last year.
The unimpaired, capital stock of the banks was $J*5P^>
including $152,000,000 preferred stock. Surplus of $1,411,000,000,
undivided profits of $5 1 6 ,000 ,000 , and reserve accounts of
$2 ^5 ,000 ,000 , a total of $ 2 ,1 7 2 ,000 ,000 , increased $1 1 ,000,000
since April and $97,000,000 since June 1941.
The percentage of loans and discounts to total deposits on
June 30 , 19^2, was 26.SI, in comparison with 29 f3! on April 4,
19^2, and 2 9 .2 ^ on June 30 , 19^1.
Page 3
Statement showing comparison of principal items of assets and liabilities of active national banks as of
June 30, 19U2, April 4, 1942, and June 30, 19I+I.
.fio ,,,($2,181,661)
$n,569.3ll( 8,71^0,822)
,l/l4,316,563
CtiiGr assets* • »•4*
•
Total assets.... ................
^57^219
44,718,965
3*00
-$667,516
-5*77
($65,400
(-86,088
-.98
- 667,516
-5.77
- 20,688
____ -»19
2.633.95^
-487,04l
24.72
- 23.OI
4,443,224
^650,184
-28 *-52
-121,648
-5.84
-59,708
-2.96
-4,809
-31.281
-1*97
-2,736
2,017.720
1,350.204
92*997
-263,911
1/516,052
-1*38
12. l4
- 13,457
3,6.88,594
3,667.906
l4.b4
-3.4o
8*57
1/178,028
-6-.46
24.66
14.17
2.66
*50
2.80
14,410,735 14,521,658
1/345.138
2.40
1/234,215
1.6l
890,823
915.7OO
43.496.537 Ui.314,635
...... -33.604..
1,661,738
-3.7.7
3.82
-58,481
3,843,640
-6-39
9*30
Total loans.......... .............
11,569,311 10,922,483
10,901,795
U. S. Government securities!
Direct obligations........ .......... 13.299.723
10,665,769 8,856,499
1 ,629,269
Obligations fully guaranteed......
2,116,310 2,279,453
Obligations of States and
2,082,182 2,020,242
political subdivisions.......... .
1.960.531*
Other bonds, notes and
debentures..... ....... ........
1.558.910
1 ,563,719 1.590,191
Corporate stocks, including stock
197,688
208,409
of Pederal Reserve Banks......... .
194,952 .
16,625,668 14,954,79918,643,388
Total investments.............. .
Total loans and investments.....
28,194,979 25.877,277
29.5^5.183
Currency and coin.....................
635.312
709.^58
728,309
Reserve with Pederal Reserve Banks....
7.753.030
7.451,783
7.U89.119
Balances with other banks.......... . 1/6,099.135
6,022.393 6,360,417
Total cash, balances with
other banks, including re
serve balances and cash
items in process of
collection........ .......... .
•
$2,247,06l)
8,654,73*0
rH
è.
1
ASSETS
Loans on real estate*,................
Other loans, including overdrafts.....
<0
lumber of banks.
:Increase or decrease : Increase or decrease
¡since Apr. *K 1942
: since June 30, 194l
: Amount
: Percent ï Amount
: Percent
-.16
-8
____ -29
1
(In thousands of dollars)
Î June 30* • April 4, : June 30»
•
13k 2
:
19^2
: 1941
i
!
•
5,H5
____ 5.I36
5.107
4.79
18,851
37.336
50.17
Page 4
Comparison of principal items of assets and liabilities of national banks - continued
(In thousands of dollars)
:
:
:
June 30,
1942
LIABILITIES
Deposits of individuals, partnerships and corporations:
Demand.....................
$21,945,397
Time.......................
7,841,032
14,196
Postal Savings deposits....... .
Deposits of U. S. Government.....
1,175,214
Deposits of States & political
subdivisions.................
2,741,720
1/6,498,697
Deposits of banks............. ..
Other deposits (certified and
cashiers' checks, etc.).......
442,861
Total deposits.............. 1/40,659,117
Bills payable, rediscounts & other
liabilities for borrowed money.
2,014
Other liabilities................
378,342
Total liabilities, excluding
capital accounts.......... .
41,039,473
CAPITAL ACCOUNTS
Capital stock:
Preferred stock...............
152,379
Common stock............. .
1,355,291
Total......................
1,507,670
Surplus.........................
1,411,407
Undivided profits & reserves.....
760,415
Total capital accounts.......
3,679,492
Total liabilities & capital
accounts.............. .
44,718,965
Ratio of loans to total deposits..
26.81$
: April 4,
:
1942
;
: June 30,
1941
:
:Increase or decrease :Increase or decrease
:since Apr. 4 , 1942
:since June 30, 1941
Amount : Percent
:
Amount
: Percent:
$20,287,746
7,721,120
14,320
1,479,538
119,194,051
8,042,313
16,352
524,585
$1,657,651
119,912
-124
-304,324
8.17
1.55
-.87
-20.57
$2,751,346
-201,281
-2,156
650,629
14.33
-2.50
-13.18
124.03
2,735,059
6,843,042
2,529,179
6,591,645
6,661
1/94,965
.24
1.39
212,541
1/346,362
8.40
5.25
396,668
39,477,493
453,178
37,351,303
46,193
1/1,620,934
11.65
4.11
-10,317
1/3,747,124
-2.28
10.03
12,270
334,192
2,005
363,186
-10,256
44,150
-83.59
13.21
9
15,156
.45
4.17
39,823,955
37,716,494
1,654,828
4.16
3,762,289
9.98
159,999
1,351,896
1,511,895
1,396,118
764,569
-7,620
5,395
-4,225
15,289
-4,154
6,910
-4.76
.25
-. 28
1.10
-. 54
.19
— 32,062
16,349
-15,713
75,317
21,747
81,351
-17.38
1.22
-1.03
5.64
2.94
3,672,582
184,441
1,338,942
1,523,383
1,336,090
738,668
3,598,141
43,496,537
29.31$
41,314,635
29. 24$
1,661,738
3.82
3,843,640
9.30
NOTE: Minus sign denotes decrease.
1/ Excludes reciprocal bank balances totaling $439,310,000, reported gross on prior call dates.
creases since prior dates are shown on comparable bases.
—oOo—
2. 26
Increases or de
TREASURY DSPARTiSENT
»Washington
Press Service
FOR RELEASE, MORNING- NEWSPAPERS
Tuesday. September X, 1942*
875x742
The Secretary of
the
Treasury announced last evening
that
the tenders for
1350,000,000, or thereabouts, of 91-day Treasury bills to be dated September 2
and to mature December 2,
1942, which
at the Federal Reserve Banks on August
were offered on August 28, were opened
31#
The details of this issue are as followsi
Total applied for - $872,936,000
Total accepted
- 350,874,000
Range of accepted bids:
High
Low
Average price
(33
- 99#925 Equivalent rate approximately 0*297 percent
- 99.906
»
»
*
0.372
»
- 99.907
«
«
*
0*367
percent of the amount bid for at the low price was accepted)
TREASURY DEPARTMENT
Washington
FOR RELEASE, MOOTING NEWSPAPERS,
Tuesday, September 1, 1942»
8/31/42
Press Service
^°* 33-4
The Secretary of the Treasury announced last evening that
the tenders for § 350,000,000, or thereabouts, of O-^-day rreasury
bills to be dated September 2 and to mature December 2, 1942,
which were offered on August 28, were opened at the Federal
Reserve Banks on August 31*
The details of this issue-are as follows:
Total applied for - §872,936,000
Total accepted
- 350,874,000 »
Range of accepted bids:
rrt: rntfi
Rnnroximately 0,297 percent
rate approx!
High
99,925 Equivalent
it
ti
n
0.372
"
Low
99•906
Average
tf
u
tt
0.367
”
Price - 99.907
33 percent of the amount bid for at the low price was accepted)
0O0-
- 3 -
issue or on subsequent purchase, and the amount actually received either
upon sale or redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss*
Treasury Department Circular No* 418, as amended, and this
notice, prescribe the terms of the Treasury bills and govern the condi
tions of their issue*
Copies of the circular may be obtained from any
Federal Heserve Bank or Branch*
Reserve Banks and Branches,,following which public announcement will he made
by the Secretary of the Treasury of the amount and price range of accepted
bids.
Those submitting tenders will be advised of the acceptance or rejec
tion thereof.
The Secretary of the Treasury expressly reserves the right
to accept or reject any or all tenders, in whole or in part, and his action
in any such respect shall be final.
Payment of accepted tenders at the
prices offered must be made or completed at the Federal Reserve Bank in
cash or other immediately available funds on
September 9» 1942_______ „•
The income derived from Treasury bills, whether interest or gain
from the sale or other disposition of the bills, shall not have any exemption,
as such, and loss from the sale or other disposition of Treasury bills shall
not have any special treatment, as such, under Federal tax Acts now or here
after enacted.
The bills shall be subject to estate, inheritance, gift, or
other excise taxes, whether Federal or State, but shall be exempt from all
taxation now or hereafter imposed on the principal or interest thereof by
any State, or any of the possessions of the United States, or by any local
taxing authority.
For purposes of taxation the amount of discount at which
Treasury bills are originally sold by the United States shall be considered
to be interest*
Under Sections 42 and 11? (a) (l) of the Internal Revenue
Code, as amended by Section 115 of the Revenue Act of 1941, the amount of
discount at which bills issued hereunder are sold shall not be considered
to accrue until such bills shall be sold, redeemed or otherwise disposed
of, and such bills are excluded from consideration as capital assets.
Accordingly, the owner of Treasury bills (other than life insurance com
panies) issued hereunder need include in his income tax return only the
difference between the price paid for such bills, whether on original
"T h '
Z fi/ y r j
/
*
r/
/
TREASURY DEPARTMENT
5
3
Washington
EOR RELEASE, MORNING NEWSPAPER,
Wednesday, September 2. 19A2 .
The Secretary of the treasury, hy this-public notice, invites tenders
for fr 350,000,000
0r thereabouts, of
91 -day Treasury bills, to be issued
on a discount basis under competitive bidding.
The bills of this series will
December 9. 1942
xfjök
when the face amount will be payable without interest. They will be issued in
be dated September 9, 1942
, and will mature
line
bearer form only, and in denominations of $>1,000, $5,000, $10,000, $100,000,
$500,000, and
§
1,000,000 (maturity value).
Tenders will be received at Federal Reserve Ranks and Branches up to t|M
war
closing hour, two o»clock p. m., Eastern SfcaxatXE* time, Friday, September 4, 1942«jpQC
Tenders will not be received at the Treasury Department, Washington. Each tender
must be for an even multiple pf $1,000, and the price offered must be expressed
on the basis of 100, with not more than three decimals, e. g., 99.925.
may not be used.
Fractions
It is urged that tenders be made on the printed forms-and for
warded in the special envelopes which will be supplied by Federal Reserve Banks
or Branches on application therefor.
Tenders will be received without deposit from incorporated banks and
4
trust companies and from responsible and recognized dealers in investment securi
ties.
Tenders from others must be accompanied by payment of 10 percent of the
j
face amount of Treasury bills applied for, unless the tenders are accompanied by
an exnress guaranty of payment by an incorporated bank or trust company.
Immediately after the closing hour, tenders will be opened at the Federaj
5»
y
TREASURY DEPARTMENT
Washington
*
FOR RELEASE, HORNING NEWSPAPERS,.
Wednesday, September 2, 1942.
97T /42
~
The Secretary of the Treasury, by this public notice, in
vites tenders for $350,000,000, or thereabouts, of 91-day
Treasury bills, to be issued on a. discount basis under compe
titive bidding.
The bills of this series will be dated
September 9, 1942, and will mature December 9, 1942, when the
face amount will be payable without interest.
They will be
issued In bearer form only, and in denominations of $1,000,
$5,000, $10,000, $100,000, $500,000, and $1,000,000 (maturity
value).
Tenders will be received at Federal Reserve Banks and
Branches up to the closing hour, two o ’clock p.m., Eastern war
time, Friday, September 4, 1942. Tenders will not be received
at the Treasury Department, Washington. Each tender must be
for an even multiple of $1,000, and the price offered must be
expressed on the basis of 100, with not more than three deci
mals, e* g., 99.925. Fractions may not be used. It is urged
that tenders be made on the printed forms and forwarded In the
special envelopes which will be supplied by Federal Reserve
Banks or Branches on application therefor.
Tenders will be received without depo'sit from' Incorporated
banks and trust companies and from responsible and recognized
dealers in Investment securities. Tenders from others must be
accompanied by payment of 10 percent of the face amount of
Treasury bills applied for, unless the tenders are accompanied
by an express guaranty of payment by an incorporated bank or
trust company.
Immediately after the closing hour, tenders will be opened
at the Federal Reserve Banks and Branches, following which
public announcement will be made by the Secretary of the
Treasury of the amount and price range of accepted bids. Those
submitting tenders will be advised of the acceptance or rejec
tion thereof. The Secretary of the Treasury expressly reserves
the right to accept or reject any or all tenders, in whole or
in part, and his action in any such respect shall be final.
Payment of accepted tenders at the prices offered must be made
or completed at the Federal Reserve Bank in cash or other
immediately available funds on September 9, 1942.
33-5
(over)
~ 2
-
The income derived from Treasury bills, whether interest
or gain from the sale or other disposition of the bills, shall
not have any exemption, as such, and loss from the sale or
other disposition of Treasury bills shall not have any special
treatment, as such, under Federal tax Acts now or hereafter
enacted. The bills shall be subject to estate, inheritance,
gift, or other excise taxes, whether Federal or State, but
shall be exempt from all taxation now or hereafter imposed on
the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing
authority. For purposes of taxation the amount of discount
at which Treasury bills are originally sold by the United
States shall be considered to be interest. Under Sections 42
and 117 (a) (1) of the Internal Revenue Code, as amended by
Section 115 of the Revenue Act of 1941, the amount of discount
at which bills issued hereunder are sold shall not be con
sidered to accrue until such bills shall be sold, redeemed or
otherwise disposed of, and such bills are excluded from con
sideration as capital assets. Accordingly, the owner of
Treasury bills (other than life insurance companies) issued
hereunder need include in his income tax return only the
difference between the price paid for such bills, whether on
original issue or on subsequent purchase, and the amount
actually received either upon sale or redemption at maturity
during the taxable year for which the return is made, as
ordinary gain or loss.
Treasury Department Circular No. 418, as amended, and
this notice, prescribe the terms of the Treasury bills and
govern the conditions of their issue. Copies of the circu
lar may be obtained from any Federal Reserve Bank or Branch.
-oOo
7
TBEASURÏ DEPARTMENT
Washington, D. C.
persons in the United States have been unintentionally violating the freezing
regulations by sending securities, currency, checks, drafts, and promissory
notes to persons in Switzerland, Spain, Portugal, Sweden, and other European
countries which are frozen under Executive Order Wo* 95309.
Public Interpretation Wo. 6, issued by the Treasury Department on
August 31, 194-i makes clear that the above-mentioned financial instruments may
be sent to blocked European neutral countries only pursuant to a Treasury Depart
ment license*
Treasury officials stated that as a general policy the Treasury
Department does not issue specific licenses permitting the sending of securities,
currency, checks, drafts, or promissory notes to blocked neutral European coun
tries*
Exception may be made in certain Gases, however, to permit the collection
of foreign securities and coupons*
It was pointed out that under this interpretation Foreign Funds Control was not stopping all types of remittances and payments to neutral European
countries*
Such remittances may be made in certain cases through established
banking channels under appropriate Foreign Funds Control general or specific
licenses*
Such licenses, however, require that the payment be effected by means
of non-negotiable mall or cable payment orders addressed to a banir in the
country in which the payment is to be made*
TREASURY DEPARTMENT
Washington
Press Service
No. 33-6
FOR IMMEDIATE RELEASE
Tuesday, September 1, 19.^2
The Foreign Funds Control Division reported to the
Treasury today it had information indicating that persons
in the United States have been unintentionally violating
the freezing regulations by sending securities, currency,
checks, drafts, and promissory notes to persons in
Switzerland, Spain, Portugal, Sweden, and other European
countries which are frozen under Executive Order No. $3$9*
Public Interpretation No. 6, issued by the Treasury
Department on August 31» 19^2, makes clear that the abovementioned financial instruments may be sent to blocked
European neutral countries only pursuant to a Treasury
Department license. Treasury officials stated that as a
general policy the Treasury Department does not issue
specific licenses permitting the sending of securities,
currency, checks, drafts, or promissory notes to blocked
neutral European countries. Exception may be made in
certain cases, however, to permit the collection of for
eign securities and coupons.
It was pointed out that under this interpretation
Foreign Funds Control was not stopping all types of remit
tances and payments to neutral European countries. Such
remittances may be made in certain cases through established
banking channels under appropriate Foreign Funds Control
general or specific licenses. Such licenses, however, re
quire that the payment be effected by means of non-negotiable mail or cable payment orders addressed to a bank in
the country in which the payment is to be made.
-oOo-
- 41 Conclusion
.1 f. .<
with
1 have tried, to outline two of the problems/which we have been
struggling in connection with the current tax bill.
has been completely solved..
Neither one
Both present major difficulties.
But
they are the stuff of which work on tax legislation is made these days.
They are the sort of problems which must be solved if our tax program
is to be successful^
lA ^
^ ^
,
- 40 -
- 39 in connection with a spendings tax, that is, a tax on the amount
which a person spends, 4rinpfe*iNhp on the amount of his income which
A
he does not save.
The debt relief problem is also presented in connection with
some corporations.
This is particularly true where corporations have
bonds or notes outstanding which are payable serially or through a
sinking fund with substantial annual payments.
There are also cases
where corporations have contracted to pay on debts a percentage of
their gross sales, or a substantial percentage of their net income
before the deduction of income taxes.
Many of the same problems are
- 38 who has always limited, himself to what he could pay for in current
cash is given no tax "benefit?
The only way to avoid this discrimination
is to treat debt payments as a form of saving, and to allow a deduction
to all taxpayers for amounts which they save, whether through payments
on debts, for insurance policies, for war bonds, or otherwise.
Such a plan might be developed in connection with a system for
compulsory savings.
Under such a systea^taxpayers would be required
to save a portion of their earnings, but they would be allowed a
credit against this amount for payments made on debts or on insurance
premiums.
Provision for debt relief might also be effectively developed
37
Such a deduction^ gives too much relief.
give too little.
Another plan might
This would provide merely for the postponement
of the payment of the tax liability over a period of two or three
years.
This would provide only temporary assistance but it might
be beneficial to those requiring time or the orderly liquidation
of their assets,
■'f'toAny plan of deduction for debt payments alone has m. great disadvantage that it discriminates against persons who are not in debt.
Why should a man who has bought many things on time and margin be
allowed a deduction for the payments he now makes, while his neighbor
- 36 Various possible ways of granting relief suggest themselves.
The most obvious would be to allow the deduction of amounts paid
on debts and other fixed commitments, «Hd-Such deduction could be
A
limited in amount or limited to amounts of payments made in excess
of a percentage of net income. However limited, such a deduction
£
would be unsatisfactory. Under the progressive rates of the income
tax, the tax value of the deduction would be very great for taxpayers
in the upper brackets.
This could be partially met by limiting
the deduction to the normal tax or the lowest bracket of the surtax.
- 34 Cases of extreme hardship, however, will no doubt arise.
Indi
viduals committed to the repayment of business losses or debts incurred
in connection will illness are Avmrrp1 rr V ftthriT" ton ijnijmrn imay, h»
accumulated .ami ty .,Q.r.. i•mre-QtjaarLt.-,,
p*a,1t!-an,ric^1ri
i
h Q'
t'tlP
-K^
4fft^osed
thir
~-y~<
Jjjp?he problems of these taxpayers, however, must be distinguished
-p r r
are merely disappointed in their
¿>-6
.—
ct^T
...
tax ratesT)
■WJLl fJllig«
'ifim m rm inib ■iownr». It is inevitable that higher taxes will make it im
possible for many taxpayers to carry out their planned schedule of
property accumulations while retaining their customary standard of
living.
Such disappointments are a relatively minor example of the
i
33 For the majority of taxpayers, the pending tax increases will not
require disastrous and uneconomic adjustments.
The national income is at
a much higher level now than ever before. Millions of taxpayers are
experiencing increases in their incomes far more than sufficient to
offset increases in their taxes.
The inability of many taxpayers to
buy commodities that are no longer being produced because of the war
will automatically release funds for the payment of increased income
taxes»Jaavg
{& 0-0
.I«.* »«.■»»!
that.
--lr3r€fi
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'fcLfc*G(X^
t"Jhe Treasury
J*ZT: I
has^-made certain proposals which would extend relief in a large number
of cases, namely* to married couples where the wife is working to taxA
payers with unusually large medical r-rprn rr-ji irrrTH"" j
11 1*111»■>'w Iwiibu
The advocates of debt relief take the view that the abrupt and
severe 1942 tax rate increases will work special hardships on
individuals
in m m a is
-^ft5frai
eni
t""",oi' debts, £
JiPnt n-P
tions.
k
ally Aftrornttaq tfr 4b1?
ayinftnfc of life insurance premiums,
A
—
other fixed obliga-
Some individuals Hetsbsfe be required to
SOT*ft£T^yi?illl'
li1um-
>Skasm
k *o
‘f't ha a boon-
ilure to make provision for
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cases of unusual hardship# may stand in the way of awniiimwa increases
in tax rate^i-'-*hnt Tn order to safeguard a relatively small number of
persons threatened with hardship cases Congress may find it necessary
to keep the general level of tax rates lower than if special relief
were provided for such persons.
- 31 Jtellef-.._£or.jaeEaoiiB with contractual obligations
I will now turn to the other topic which I wish to discuss
■before you today.
as debt relief.
This is the question which is summarily known
There has been considerable sentiment in support of
some provision for the relief of taxpayers who have obligations
to repay debts or to meet other fixed financial commitments*
first bracket of the surtax.
this would be 19 percent.
Under the rates of the House bill,
Thus, if 1942 normal tax and first
bracket of surtax were forgiven, collection at the source might begin
on January 1, 1943 at the 19 percent rate. 0\
'/"‘A i
w t.Vi q
percent withhcn.ding rate almost $5 billion would be
...
""
r¥% JL
collected at^ source at 1942 levels of income. This is nearly twoIh V /c^ucnI.
thirds of the $8 billion total, liabilities. The Rural plan, if
f l i 1
combined with collection at source, would permit changes in tax
A
rates and changes in national income to be reflected in tax collections
promptly.
Moreover, it would make possible the adaptation of the
income tax to the requirement of fiscal policy and to the needs of
the millions of taxpayers who budget their outlays on a weekly or
monthly basis.
-
T-f fc>l-fr nTinnor r v
28
-
n r "3 * g i r b H f nT 1 t?"*i"?
- n™™ir>t g f
S ^ic^Cv (a^—,
One of the attractive possibilities of l>he '"Itiunl pirtn is thirl
A
it,AMtoi gives a means by which collection at the source could be
ed
inaugurated on a substantial basis, I have already point/out that
one of the serious difficulties with the institution of a collection
at the source plan is the hump or doubling up of tax liabilities.
If one year*s tax liability were eliminated, then collection at the
source might begin at a rate equivalent to the normal tax and the
>
- 27 -
th e u revfrm s
|nftnwfl
Vnv t - T p a p r a
a,fl,„
doub!
7 ^
Finally, the Riiml plan imp»»
HW?e
Tmrrlfln oa> ttan tax-
U A u |t{
payer,» oiaee W will be required every March to make double computa
tions of income and taxes.
This burden would increase in importance,
with fluctuations in rates and exemptions.
Most of the inequitable features of the Huml plan could be
eliminated. J>y gancelling a part of the 1943 liabilities instead of
cancelling*ȣ4 1941 liabilities, as proposed by Mr. Ruml.
Under a
plan so modified^? the present normal tax (4$) and the first bracket
(6$) of the present surtax would be canceled on 1942 income, and
the remaining surtax on 1942 income, -rmnld bn p n ynM-r-nrnr n two»«vaar
3
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to them.
Persons whose incomes were abnormally low in 1941 suffer a
i
relative loss..
^ ■fiQvarnr»l
...eACTtfrithe-"Bn«*! ■•p-]»an <tolfty«’'4>ho ■
ioat ten
~h~<?
higher rates
until 1943, itjJL<Kf^rovides a windfall
to persons with abnormaì^t hl^arlncomes ih both 1941 and 1942. Their
1941 liabilities wp#?$jabe carS^lefrjx^nd their 1943 liabilities would
be compujpè^ht the present lowerS^ates, instM^d of the new higher
fati a which wuuld apply T f Hlft M l l ^ Iàn were rlT
The Rumi- plan does noi; e li m i n a te ^ e
doublTng up loT^TgCXe s.-~^Xn
any y.eaJ ^ oliawAjLg, ah .,,
wou lc t ,p ay
th w r "a’-'f
, -an
nrl jv f rivifll
"ygar^^'^taje11- t i 'ab 11 iSg*:
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- 25 would perpetuate one of the weaknesses of the present system.
Under
the Huml plan^pa person with an abnormally high income in 1944 and
aT'Tiowincome in 1945 would be especially hard hit both because his
tentative 1945 tax would be high and because he would have to pay
a substantial deficiency tax on 1944 income in 1945*^v
The Huml plan involves some ineauitable shifts in the tax burden,
ASome burden will be shifted from persons who are now taxpayers to
persons who newly become taxpayers.
This will occur because new
taxpayers will pay a tax for all years during which they receive
income while those already paying taxes will be relieved of a year’s
taxes at the time their income stops as a result of unemployment,
retirement, or death.
A more immediate inequity arises from the relief granted by
nfwm•
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24
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Although the Ruml plan would keep the taxpayer out of debt to
the Government, it would not place income tax collections on a
current basis, unless collection at^source were made part of the
plan*
Tax payments in any future year would depend not on that
year’s income hut upon the income of the preceding two years.
The
tax payable in 1945, for example, would be determined by the income
received in 1944 and the change in income from 1943 to 1944.
This
23
.
- <
50 r-e r v - s 7
Lo
This creates an undesirable lag "between the flow of incomes and the
flow of tax collections.
<¡2^1
4"*-A.
The removal of the lag '
"by.aaao illan eueh.
¿V'Oe-fM. C t ^ t o P — t-v/ >6»* a .rfjUiX^oU^r A ^ W < ^ V
on tlunt •nimiim >1 1.ji-Mmi.
im iuiTOm —1 W1 ■» J>»nn»nn„.aao.r».ir.,.,ajL£.£l^n1 ti fle , -F/yi<
* nnt »W\ I
»
^faé^r^gpeoiali ■0!Ajwtroe^tiO'»-^^l>é'--»<aeA. to...b e roadg.,
Under Mr, Kami's planj^the individual would on March 15 of each
year compute <|B^*>a tentative tax for the current year»,
Thlu 'twutji
^ivo te»'^wm l à »fee .aojapuWé» by assuming that his income in the
current year was going to he the same as his income in the preceding
y e a r ,
t lVìPi
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1 ........ '"»»"""' I
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l i i il I i l
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In order to get started without doubling up of taxes, Mr, Ruml
A
would cancel liabilities on 1941 incomes.
He would treat the tax
actually paid in 1942 as a tentative tax for the year 1942 instead
ì
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A plan for placing the income tax on a current basis »haj Hyeen..
advanced by Mr, Beardsley Ruml, Treasurer of R, H, Macy and
Company and Chairman of the Board of Governors of the Federal
Reserve Bank of New York.
/J* \
mu
Ruml stressed, the importance of getting ^1» taxpayers out
-_r rf* j
of debt to the CnTrmnnnt xbinirlng tha
hmre *nnA intn uo.
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b e i r
I S
4
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t a g
. e n d - e f t b o wnr
Qf t i p r
lia h A
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i t y ,x o m n
wVEtt
l
1QA1
u n p n d d r a n d ■ p o s tp u rr a tt
Tnmw uP H u m . p m m i^ mnjr f ia d
r 1 7 7 — H r - t r 1" | T m m ..
Ii 1 1 \
inTti
u n t i
1
th e *
^ f, T ftr7 d i f f i c u l t
11
t l i nn,
onponi
il l ijj'
t f
th^ war’’^~iT6TloweS^by severe unemployment^ Apparenily15rily à"
sïïirI 1
p mro outage uf the popul-atie»* ao<»ru<>»< ■! t ^ t egp^li-atrt'Yrties ;>4he-
maj o r i t y . n ayc »»! bj tiaxii'j when ‘due1 uuy^ui? cu.11 enU W a r1* sn earning^»
1
i
21
-
that the withholding rate under the House hill is fixed at 5 percent
for 1943 and at 10 percent for 1944.
This means that taxpayers
in 1943 will have to pay all of their tax on 1942 income, and also
will have collected from them a tax of 5 percent on their 1943 income.
The 5 percent withheld at the source will be creditable against their
1943 tax liability due in 1944; but in 1944 a tax of 10 percent will
be collected at the source.
Thus, there is a step of 5 percent in
each of the years* 1943 and 1944.
To avoid the difficulty which is presented by the necessity of
collecting more than one year*s taxes during the transition years,
it has been suggested that some or all of one year*s tax liability
might be cancelled and the income tax placed on a more current basis.
If this were done, it would be possible to collect at the source
during 1943 and thereafter a tax at a much higher rate than 5 percent.
-
20
-
These representations were such that the Treasury
reluctantly
agreed that the collection at source plan should not now be applied
to bond interest.
This recommendation has been made to the Senate
Finance Committee and has been tentatively adopted there.
The system
of collection at the source will, however, be applicable to dividend
payments.
The "Hump11
One of the major difficulties in introducing any provision
for collection at the source into our tax system is the fact that
if nothing more is done there is a doubling up of income tax
collections.
The taxpayer has to pay in 1943 his tax on 1942 income
and he will also have tax withheld in 1943 out of 1943 income as well.
It is for this reason that the House bill provides for a gradual
increase in the amount collected at the source,
1
I have already mentioned i
- 19 there would he a very heavy increase in the amount of paper work
required all along the line in the collection process.
Because
of these difficulties, the Board of Governors of the Federal Reserve
System recommended that the collection at source plan he dropped
A
as far as bond interest is concerned.
The practical difficulties
do not apply on the whole to interest on registered bonds, hut it
was felt that it would he unwise to have anything which might he
felt to he discrimination against registered bonds in favor of
coupon bonds.
,
18
/■nnrtti «launder*
Ideally, collection at the source should apply not only
to salary and wage payments but also to other forms of income,
particularly interest and dividends.
The bill which passed the
House of Representatives provided for collection at the source
from both of these types of income.
It soon became apparent,
however, that the practical difficulties would be very considerable
in applying this tax to income derived from bond coupons.
sen tat ions/were made on behalf of the banks
Repre-
that bond
coupons would all have to be handled on a collection basis, and that
-
income tax.
16
-
The objections to this suggestion are serious.
Such a
tax, if accompanied by a i^oiinpntnmtinnr vax on income from other sources,
would raise the extremely serious problem of administering a substantial
tax without exemptions on every self-employed income receiver in the
bnited States, however small his income.
If not accompanied by t Tfuh a
'OonpftiiMfctetfy tax, the withholding tax would be nothing more than a class
tax on salaries and wages.
It would provoke demands for wage increases
and tend to undermine price ceilings.
- 15 dependents, but some allowance is also made for deductions allowed
in computing taxable income.
Without these allowances, the volume
of refunds and the job of administration would be multiplied.
Furthermore, fche1'jwiupusal would be very burdensome to the millions
/»
of individuals with incomes below the exemption levels from whom small
amounts would be withheld only to be refunded later.
These individuals
are in urgent need of receiving their entire income currently.
More
over, while millions of persons with small incomes were being deprived
of the current use of part of their income, many millions of selfemployed would be favored in comparison since in their case no
withholding would take place.
It has been suggested that a gross tax might be introduced as an
additional or separate tax rather than as prepayment of the regular
14 other deductions.
Such a plan, it is claimed, could he administered
more readily, would he simpler for both employer and employee, and would
collect more than the Treasury plan.
Examination of the administrative and compliance aspects of
collectionfcat*source on a gross rather than a net basis indicates
thaiy fchfl".anticipated simplification, »e largelyrfrlluse« ^
The adminis-
tration of collectionAatisource on the basis of gross income would
A
undoubtedly be more difficult.
Instead of some 30 million taxpayers,
the Bureau of Internal Revenue would have to deal with some 55 million.
The added 2 5 million would have incomes of less than the income tax
exemption and would have no income tax liability against which to offset the amounts collected^at-^source.
Under the Treasury plan, not
A
only is an allowance made for personal exemptions and credits for
1
- 13 Once the collection^t/source machinery is established, the
techniques can he perfected and its costs reduced.
Shortages in
personnel and equipment may cause some employers considerable dif
ficulty in providing for collectionfa ^source during the war period.
Hq w b t w i
r f '- t h e 1 ■e m p l o y e » » 1-
source would be impossible to handle.
f e l t
t h a t »■ eo.l l .a f i- t i o n . —a »'
It should b^jarcrtea, too that
collection-at-source will become nec^eeE^y in any event if the
failure of other price co&troX and revenue measures leads to the
adoption of a coaptflsory savings plan.
The adoption of collection-
at-sou£et$ would simplify a subsequent introduction of compulsory
HacJLion-a^— irfifi. ™
.3
It has been suggested that collectionvat source Hoe based on
A
A
gross income, before personal exemptions, credits for dependents, and
-
12
-
The collection#at*source technique is not wholly n e w O n
a
limited scale it is used in collecting income taxes on the interest
from tax-free covenant bonds and on
aliens.
income^paid to non-resident
It is already in use on a large scale by employers in
connection with Social Security payroll taxes and with payroll allot
ment plans.
Moreover, employers are making many deductions-at-
source for non-governmental purposes, for example, community chest,
Red Cross, insurance, and union dues.
All but three of ^ * » 4 5 4
employers recently interviewed are at present making payroll deduc
tions and three-fourths of them are deducting at least four items.
-
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e
11
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y
higlf InS'diSe '
^taxerr“t5rnTffi3iyn!iir:mbTO^"'t^
d1 RTieTifial»l^ » .
M«WifchQat.>4AWJW»tha^,.igLt?lnTnp .tax mugt renp^ p ft cla.aA,-t«a»r->
'fk*
Collectionfai^source is essential to the flexibility of fiscal
^
A^Xao
""/Xs*.
policy. Without it* the income tax can be adjusted only once a
year; changes in rates and exemptions and increases in national
income cannot affect tax collections until March of the following
year.
*fta
Collection*fet#source would enable Congress to adjust the
,
'fu ,
*
yield of income tax to current needs promptly and at any time during
A
the year.
r
■fnl 1rmrh*f
,.i.KLaft«A.
Small income recipients who will now
become taxpayers cannot be expected to set aside reserves for taxes,
They are accustomed to weekly or monthly « u M fio t yearly budgeting.
•^tsJL
^
, 1- -i^ ^ i
Collectionnat#source f e e U i e e r .f c o n t
a p p l i e s ^ relieve» the tax
payer^frorn the periodic pressure of quarterly tax payment and keep*
him out of debt to the Government.
There is danger that if the
majority of income taxpayers is not afforded a vehicle for paying
taxes out of current earnings through a system of collectionnât#
source, the entire income tax structure may be undermined by widespread
Collection^atj^feource is essential to the adequate adrainistration of the income tax and for safeguarding the revenue.
income tax has "become a mass tax.
returns for 1942*
Over 30 million people will file
This includes approximately
who have not filed returns before.
The
8 million
people
Aside from the question of
personal honesty, it is almost inevitable that many of these people
will fail to make income tax returns voluntarily.
-floCollectionirat^source will ease the full impact of the income
A
tax on taxpayers. The tax is now substantially higher than ever
before.
To”the
ker t fthnti people fail to ^ weroiao solf ■dtecipline
^ n c H n ^
helnU Tmini ..
1-
■
1■
■
t tv j
thnjT
»tfix hill extremaly,onerou si, 'if- ito payiiioyifr" is delayed to-'-th#1year
- 5 This is not an additional tax.
It is simply a means for
collecting a part of the tax which has already been imposed upon
the employee.
The amount so collected at the source will be
available as a credit against the tax due when the employee*s
income tax return is filed on March 15th following the year of
employment.
The House bill provides for withholding at the rate of
5 percent in 1943 and 10 percent in 1944.
IUM
- 4 «H i
A a p e e fr
rlgimtino ii«.rr
Collection at the Source
/
The revenue bill passed by the House of Representatives
includes a provision which is novel in the modern American income
tax though it has been widely adopted abroad*
This is a provision
for the collection of a part of the income tax at the source*
Under the House bill, this will become effective next January 1st,
after which datey’
employers will commence deducting a tax %
cent from the wages of their employees.
5 per
This tax will not be
applied to the gross amount of the wage but only to the part of the
wage or salary which is in excess of the employee^ personal exemption
and credit for/dividends!
I
at a premium which will result in a fairer tax treatment in these
cases.
But all of this stuff is pretty technical and narrow,
I do
not .think that you want me to grub around the details of the tax
■In place uf this* I am going to try to tilkfa^ut ^two of the
A
major problems about which we have been thinking and which are
still far from solved.
These are the problems of devising a system
for the collection of a substantial part of the income tax at the
source, and the problem of relief for persons who have outstanding
debts or other contractual obligations.
I thought over quite a while the question of what I should
say to you today.
My present work is primarily with taxes and 1
thought for a while that you might he interested in having me
describe some of the provisions of the current tax hill which are
especially applicable to hanks and hankers.
That would give me
an opportunity to tell you of the extraordinarily favorable treat
ment which hanks receive under this hill.
Banks can deduct their
capital losses in full, hut they are taxed on only a percentage of
their capital gains.
Banks can deduct losses on bonds and notes in
full, although these losses would he capital losses for most tax
payers*
There is an elaborate new provision in the statute providing
for the amortization of the premium in the case of bonds purchased
Speech
First Draft
8/24/42.
O'(o
'S
3
It is a great pleasure for me to be invited to speak before
the Fifth Virginia Bankers* Conference.
The world of finance has
always been a little beyond me, and I hope that by being with you,
I may learn some of the things that have in the past eluded my
grasp.
As a matter of fact, I have some claim to attend your con
vention in my own right, for I have served as a member of the Board
of the Federal Reserve Bank of New York, ^ut I was a public member,
and the primary duty of a public member is to listen long and say
little.
It is, therefore, a new rtfle for me to be with bankers
in a speaking capacity.
I
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C ^
Zj
4
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4 J
Z
F /FFC U s
< f* ? Y
j
z.
Speech prepared by Randolph E. Paul,
General Counsel of the Treasury for the
Fifth Virginia Bankers * Conference
Charlottesville, Virginia,
September 33 1942
It is a great pleasure for me to be invited to speak before the
Fifth Virginia Bankers1 Conference, The world of finance has always
been a little beyond me, and I hope that by being with you, I may
learn some of the things that have in the past eluded my grasp. As
a matter of fact, I have some claim to attend your convention in my
own right, for I have served as a member of the Board of the Federal
Reserve Bank of New York, But I was a public member, and the primary
duty of a public member is to listen long and say little. It is,
therefore, a new rule for me to be with bankers in a speaking capacity,
I thought over quite a while the question of what I should say to
you today. My present work is primarily with taxes and I thought for
a while that you might be interested in having me describe some of the
provisions of the current tax bill which are especially applicable to
banks and bankers. That would give me an opportunity to tell you of
the extraordinarily favorable treatment which banks receive under this
bill. Banks can deduct their capital losses in full, but they are
taxed on only a percentage of their capital gains. Banks can deduct
losses on bonds and notes in full, although these losses would be
capital losses for most taxpayers. There is an elaborate new
provision in the statute providing for the amortization of the premium
in the case of bonds purchased at a premium which will result in a fairer
tax treatment in these cases.
But all of this stuff is pretty technical and narrow. I do not
think that you want me to grub around the details of the tax bill.
You would no doubt prefer to have me approach the problem from a broader
and less selfish angle, I am going to try to talk, therefore, about
two of the major problems about which we have been thinking and which
are still far from solved. These are the problems of devising a system
for the collection of a substantial part of the income tax at the
source, and the problem of relief for persons who have outstanding
debts or other contractual obligations,
Coliection at the Source
The revenue bill passed by the House of Representatives includes
a provision which is largely novel in the modem American income tax
though it has been widely adopted abroad. This is a provision for the
collection of a part of the income tax at the source. Under the House
bill, this will become effective next January 1st, after which date
33-7
-
2
-
employers will commence deducting a tax of 5 percent from the wages of
their employees» This tax will not be applied to the gross amount of
the wage but only to the part of the wage or salary which is in excess
of the employee’s personal exemption and credit for dependents.
This is not an additional tax* It is simply a means for collect
ing a part of the tax which has already been imposed upon the employee.
The amount so collected at the source will be available as a credit
against the tax due when the employee’s income tax return is filed on
March 15th following the year of employment. The House bill provides
for withholding at the rate of 5 percent in 1943 and 10 percent in 1944»
Collection at the source is essential to the adequate administra
tion of the income tax and for safeguarding the revenue. The income
tax has become a mass tax. Over 30 million people will file returns
for 1942. This includes approximately 8 million people who have not^
filed returns before. Aside from the question of personal honesty, it
is almost inevitable that many of these.people will fail to make income
tax returns voluntarily.
Collection at the source will ease the full Impact of the income
tax on taxpayers. The tax is now substantially higher than ever before.
Small income recipients who will now become taxpayers cannot be expected
to set aside reserves for taxes. They are accustomed to weekly or
monthly rather than yearly budgeting. Collection at the source helps
to relieve the taxpayer from the periodic pressure of quarterly tax
payment and to keep him out of debt to the Government. There is danger ■
that if the majority of income taxpayers is not afforded a vehicle for
paying taxes out of current earnings through a system of collection at
the source, the entire income tax structure may be undermined by wide
spread delinquencies.
Collection at the source is essential to the flexibility of fiscal
policy. Without it, the rates of the income tax can be adjusted only
once a year; and changes in rates and exemptions and increases in
national income cannot affect tax collections until March of the fol
lowing year. Collection at the source would enable Congress to adjust
the yield of the income tax to current needs promptly and at any time
during the year.
The collection at the source technique is not wholly new. It was
included in our first income tax back in 1913* On a limited scale it
is used in collecting income taxes on the interest from tax-free cove
nant bonds and on income paid to non-resident aliens. It is already in
use on a large scale by employers in connection with Social Security
payroll taxes and with payroll allotment plans'. Moreover, employers are
making many deductions-at—source' for non-governmental purposes, for ex
ample, community chest, Red Cross, insurance, and union dues. All but
three of 454 employers recently interviewed are at present making^payroll
deductions and three—fourths of them are deducting at least lour items*
- 3 -
Once the collection at source machinery is established, the tech
niques can be perfected and its costs reduced. Shortages in personnel
and equipment may cause some employers considerable difficulty in pro
viding for collection at source during the war period» But many of the
same difficulties were faced at the time the Social Security taxes were
introduced. The problems they presented were not easy, but they wore
solved. There seems to bo no reason to think that the problems of col
lection at the source cannot be solved now.
It has been suggested that collection at the source should be based
on gross income, before personal exemptions, credits for dependents, and
other deductions. Such a plan, it is claimed, could be administered more
readily, would be simpler for both employer and employee, and would col
lect more than the Treasury plan.
Examination of the administrative and compliance aspects of collec
tion at the source on a gross rather than a net basis indicates that
there would not be much gain on the score of simplification. The ad
ministration of collection at the source on the basis of gross income
would undoubtedly be more difficult. Instead of some 30 million tax
payers, the Bureau of Internal Revenue would have to deal with some
55 million. The added 25 million would have incomes of less than the
income tax exemption and would heave no income tax liability against
which to offset the amounts collected at the source. Under the Treasury
plan, not only is an allowance made for personal exemptions and credits
for dependents, but some allowance is also made for deductions allowed
in computing taxable income. Without these allowances, the volume of
refunds and the job of administration would be multiplied.
Furthermore, a gross withholding tax would be very burdensome to
the millions of individuals with incomes below the exemption levels
from whom small amounts would be withheld only to be refunded later.
These individuals are in urgent need of receiving their entire income
currently. Moreover, while millions of persons with small incomes were
being deprived of the current use of part of their income, many millions
of self-employed would be favored in comparison since in their case no
withholding would take place.
It has been suggested that a gross tax might be introduced as an
additional or separate tax rather than as prepayment of the regular
income tax. The objections to this suggestion are serious. Such a tax,
if accompanied by a corresponding tax on income from other sources, would
raise the extremely serious problem of administering a substantial tax
without exemptions on every self-employed income receiver in the United
States, however small his income. If not accompanied by a tax on other
income, the withholding tax would be nothing more than a class tax on
salaries and wages. It would provoke demands for wage increases and tend
to undermine price ceilings.
Ideally, collection at the source should apply not only to salary
and wage payments but also to other forms of income, particularly inter
est and dividends. The bill which passed the House of Representatives
provided for collection at the source from both of these types of income.
It soon became apparent, however, that the practical difficulties would
be very considerable in applying this tax to income derived from bond
coupons. Representations were made on behalf of the banks that bond
coupons would all have to be handled on a collection basis, and that
there would be a very heavy increase in the amount of paper work required
all along the line in the collection process. Because of these diffi
culties, the Board of Governors of the Federal Reserve System recommended
that the collection at the source plan be dropped as far as bond interest
is concerned. The practical difficulties do not apply on the whole to
interest on registered bonds, but it was felt that it would be unwise to
have anything which might be felt to be discrimination against registered
bonds in favor of coupon bonds.
These representations were such that the Treasury reluctantly agreed
that the collection at source plan should not now be applied to bond
interest. This recommendation has been made to the Senate Finance Com
mittee and has been tentatively adopted there. The system of collection
at the source will, however, be applicable to dividend payments.
The 11Hump”
One of the major difficulties in introducing any provision for col
lection at the source into our tax system is the fact that if nothing
more is done there is a doubling up of income tax collections. The tax
payer has to pay in 1943 his tax on 1942 income, and he Will also have
tax withheld in 1943 out of 1943 income as Yfell. It is for this reason
that the House bill provides for a gradual increase in the amount col
lected at the source. I have already mentioned that the withholding
rate under the House bill is fixed at 5 percent for 1943 und at 10 per
cent for 1944. This means that taxpayers in 1943 will have to pay all
of their tax on 1942 income, and also will have collected from them a
tax of 5 percent on their 1943 income. The 5 percent withheld at the
source will be creditable against their 1943 tax liability due in 19445
but in 1944 a tax of 10 percent will be collected at the source. Thus,
there is a step of 5 percent in each of the years 1943 and 1944*
To avoid the difficulty which is presented by the necessity of
collecting more than one year’s taxes during the transition years, it
has been suggested that some or all of one year’s tax liability might
be cancelled and the income tax placed on a more current basis. If
this were done, it would be possible to collect at the source during
1943 and thereafter a tax at a much higher rate than 5 percent,
- 5A plan for placing the income tax on a current basis has been ad
vanced by Mr. Beardsley Ruml, Treasurer of R. H. Macy and Company and
Chairman of the Board of Governors of the Federal Reserve Bank of
New York. Mr. Ruml stresses the importance of getting taxpayers out
of debt to the Government. Moreover, there is an undesirable lag
between the flow of incomes and the flow of tax collections. The re
moval of the lag so that tax payments would be made currently would
be a desirable improvement in our tax system.
Under Mr. Ruml’s plan the individual would on March 15 of each
year compute'a tentative tax for the current year by assuming that his
income in the current year was going to be the same as his income in
the preceding year. On the following March 15th he would file another
return for the year showing his actual income and he would then pay any
difference in tax if his income was larger or, if his income had de
clined, he would collect a refund of the excess payment he had made.
In order to get started without a doubling up of taxes, Mr. Ruml
would cancel liabilities on 1941 incomes. He would treat the tax
actually paid in 1942 as a tentative tax for the year 1942 instead of
as a final settlement of 1941 liabilities. A final return of 1942
income would then be filed in March, 1943« This would be the tenta
tive return for 1943, and so on.
Although the Ruml plan would keep the taxpayer out of debt to the
Government, it would not place income tax collections on a current
basis, unless collection at the source were made part of the plan.
Tax payments in any future year would depend not on that year’s income
but upon the income of the preceding two years. The tax payable in
1945, for example, wrould be determined by the income received in 1944
and the change in income from 1943 to 1944« This would perpetuate one
of the weaknesses of the present system. Under the Ruml plan a person
with an abnormally high income in 1944 and a low income in 1945 would
be especially hard hit both because his tentative 1945 tax would be
high and because he would have to pay a substantial deficiency tax on
1944 income in 1945. Mr. Ruml has suggested in general terms that
some relief should be given in such cases but he has not faced the ad
ministrative problem. that would be met in devising a system for such
relief.
The Ruml plan also involves some inequitable shifts in the tax
burden. Some burden will be shifted from persons who are now taxpayers
to persons who newly become taxpayers. This will occur because new
taxpayers will pay a tax for all years during which they receive income
while those already paying taxes will be relieved of a year's taxes at
the time their income stops as a result of unemployment, retirement, or
death.
- 6 -
A more immediate inequity arises from the relief granted by the
plan to the thousands or millions of individuals whose incomes were
abnormally high in 1941« The cancellation of their 1941 liabilities
constitutes a windfall to them. Persons whose incomes were abnormally
low in 1941 suffer a relative loss.
Finallys the Ruml plan is really very complicated. The payer
would be required every March to make double computations of income
and taxes. This burden would increase in importance, with fluctuations
in rates and exemptions.
Most of the inequitable features of the Rural plan could be elimi
nated by cancelling a part of the 1942 liabilities instead of cancelling
the full 1941 liabilities, as proposed by Mr., Rural. Under a plan so
modified the present normal tax (4$) and the first bracket \6%) of the
present surtax would be canceled on 1942 income, and the remaining sur
tax on 1942 income could be kept a year behind as at present or made
payable over a period of years.
One of the attractive possibilities of such an arrangement is that
it gives a means by which collection at the source coula be inaugurated
on a substantial basis. I have already pointed out that one of the
serious difficulties with the institution of a collection at the source
plan is the hump or doubling up of tax liabilities. If one year1s^tax
liability Y\rere eliminated, then collection at the source might begin
at a rate equivalent to the normal tax and the first bracket of the
surtax. Under the rates of the House bill, this would be 19 percent.
Thus, if 1942 normal tax and first bracket of surtax were forgiven,
collection at the source might begin on January 1, 1943 at the 19 per
cent rate, or preferably at the less awkward rate of 20 percent of
income over exemptions.
With a 20 percent withholding rate almost $5 billion would be
collected at the source at 1942 levels of income. This is nearly twothirds of the $8 billion total individual liabilities. The Rural plan,
if combined with collection at the source, would permit changes in tax
rates and changes in national income to be reflected in tax collections
promptly. Moreover, it would make possible the adaptation of the income
tax to the requirement of fiscal policy and to the needs of the millions
of taxpayers who budget their outlays on a weekly or monthly ba.sis.
Relief for persons with contractual obligations
I will now turn to the other topic which I wish to discuss before
you today. This.- is the question which is summnrily known as debt relief.
There has been considerable sentiment in support of some provision for
the relief of taxpayers who have obligations to repay debts or to meet
other fixed financial commitments.
- 7 -
Tho advocates of debt relief take the view that the abrupt and severe
1942 tax rate increases will work special hardships on individuals who
must pay substantial amounts for debts , life insurance premiums, and other
fixed obligations. Some individuals may be required to face unfair and
discriminatory burdens or hardships. It is also possible that failure to
make provision for cases of unusual hardship may stand in the way of
negcled increases in tax rates. In order to safeguard a relatively small
number of persons threatened with hardship cases, Congress may find^it
necessary to keep the general level of tax rates lower than if special
relief were provided for such persons.
For the majority of taxpayers, the pending tax increases will not
require disastrous and uneconomic adjustments. The national income is
at a much higher level now than ever before. Millions of taxpayers are
experiencing increases in their incomes far more than sufficient to off
set increases in their taxes. The inability of many taxpayers to buy
commodities that are no longer being produced because of the war will
automatically release funds for the payment of increased income taxes.
The Treasury has also made certain proposals which would extend relief
in a large number of cases, particularly to married couples where the
wife is working and to taxpayers with unusually large medical expenses.
Cases of extreme hardship, however, will no doubt arise. Individ
uals committed to the repayment of business losses or debts incurred in
connection with illness are examples* The problems of these taxpayers,
however, must be distinguished from those of individuals who are merely
disappointed in their expectations because of the increases in tax rates.
It is inevitable that higher taxes will make it impossible for many^
taxpayers to carry out their planned schedule of property accumulations
while retaining their customary standard of living. Such disappointments
are a relatively minor example of the many inevitable sacrifices of war.
Various possible ways of granting relief suggest themselves. The
most obvious would be to allow the deduction of amounts paid on debts
and other fixed commitments. Such a deduction could be limited in
amount or limited to amounts of payments made in excess of a percentage
of net income. However limited, such a deduction would be unsatisfactory.
Under the progressive rates of the income tax, the tax value of the de
duction would be very great for taxpayers in the upper brackets. This
could be partially met by limiting the deduction to the normal tax or
the lowest bracket of the surtax.
Such a deduction, however, gives too much relief. Another plan
might give too little. This would provide merely for the postponement
of the payment of the tax liability over a period of two or three years.
This would provide only temporary assistance but it might be beneficial
to those requiring time or the orderly liquidation of their assets.
- 8 -
Any plan of deduction for debt payments alone has the great dis
advantage that it discriminates against persons who are not in debt.
Why should a man -who has bought many things on time and margin be al
lowed a deduction for the payments he now makes, while his neighbor
who has always limited himself to what he could pay for in current
cash is given no tax benefit? The only way to avoid this discrimina
tion is to treat debt payments as a form of saving, and to allow a
deduction to all taxpayers for amounts which they save, whether through
payments on debts, for insurance policies, for war bonds, or otherwise.
Such a plan might be developed in connection with a system for
compulsory savings. Under such a system taxpayers would be required
to save a portion of their earnings, but they would be allowed a credit
against this amount for payments made on debts or on insurance premiums.
Provision for debt relief might also be effectively developed in connec
tion with a spendings tax, that is, a tax on the amount which a person
spends, or, to put it another way, on the amount of his income which he
does not save.
The debt relief problem is also presented in connection with some
corporations. This is particularly true where corporations have bonds
or notes outstanding which are payable serially or through a sinking
fund with substantial annual payments. There are also cases where
corporations have contracted to pay on debts a percentage of their
gross sales, or a substantial percentage of their net income before
the deduction of income taxes. Many of the same problems are presented
in dealing with such cases as those which I have outlined in connection
with individual taxpayers. There is, however, a more immediate way of
dealing with them. The Treasury has recommended and the Senate Finance
Committee has approved a post-war credit of a portion of the income and
excess profits taxes which will be levied on this year’s income. Amounts
paid on debts can be treated as an offset against the amount of this
postwar credit, and this will serve to grant some relief to corporations
which are faced with this problem.
Conclusion
I have tried to outline two of the problems with which we have been
struggling in connection with the current tax bill. Neither one has
been completely solved. Both present major difficulties. But they are
the stuff of which work on tax legislation is made these days. They are
the sort of problems which must be solved if our tax program is to be
successful in this critical time.
Seft-
Statement of EandoXph JU Paul»
Oeasyal Counsel of the ¡Treasury Department,
before the Senate Finance Committee
in Executive Session
in support of the recommendations of
the Secretary of the Treasury
for an additional war-time r»venue program
In his statement Secretary Morgen than emphasised the need for addi
tional taxes to increase Treasury receipts out of current’income by an
amount far in excess of his previous recommendations and to exerdise a
strong restraining influence on consumer spending in order to furnish an
effective weapon for combatting inflationary increases in prices.
The Secretary has indicated the broad outlines of the Treasury’s
recommendations# It is my purpose to discuss these recommendations in
detail. The proposed spendings tax is in two parts — a flat rate tax
to be refunded after the war, and a progressive surtax.
The Refundable Part of fcfye, Spendings Tax
The refundable part of the spendings tax would be imposed at a
flat rate of 10 percent on the total spendings of individuals for con
sumer goods and services. In general, it would apply to all individuals
who had income subject to the individual income tax, and also to
individuals subject to the spendings surtax whether or not they had
income subject to the income tax.
It is suggested that single persons be entirely outside the scope
of the tax only if their income is less than $500, and married couples
only if their income is less than $1,000. The exclusion would be in
creased by an additional $250 for each dependent* The test for deter
mining liability to file a refundable spendings tax return would therefore
be stated in terms of income, even though the tax itself would be assessed
on the basis of spendings. The reason for using the income test is to
facilitate the administration of the refundable spendings tax by collecting
it in conjunction with the individual income tax*
Tax base
The tax would be levied on total spendings of persons filing returns
and reporting total spendings in excess of $500 for a single person,
$1,000 for a married couple, and an additional $250 for each dependent*
The tax would be imposed on the taxpayer’s total spendings, not merely
on that part of his spendings above these amounts*
- 2 ~
The amount of spendings would be computed indirectly« From the total
amount of funds at the disposal of the taxpayer, derived either from
current income or by drawing on capital, there would be subtracted the
amount of savings* Savings 11 would be defined to include, chiefly, re
payment of debt, premiums paid on life insurance, expenditures for the
purchase of bonds or other capital assets, giftfe and contributions,
payment of taxes and increases in bank balances. The items needed to
determine the tax base are shown in the attached schedule (Exhibit l)*
Method of collection
The refundable part of the spendings tax would be collected in the
same manner and at the same time as the individual income tax* A tenta
tive tax would be collected at source on wages, salaries, and dividends
in the same manner as it is proposed to collect part of the regular
income tax* A spendings tax return would be made part of the annual
income tax return. The amount of spendings «and the tax thereon would,
also be commuted on the same return. The total of the income tax and
the spendings tax payable would be ascertained by deducting the income
tax and the spendings tax already collected at source. If the amount
collected at source exceeded the combined tax liability, the excess
would be promptly repaid to the taxpayer.
Short income and spendings tax form
The great majority of taxpayers would be eligible to file a
simplified refundable spendings tax return which would be a supple
mentary part of their simplified income tax return.
Tax rate and amount of tax
The refundable part of the spendings tax would be levied at a rate
of 10 percent on the taxpayer’s total spendings, An individual with
an income of $5,000, for example, who spent $3,200, would pay a tax of
$320. If he increased his savings and spent only $2,^00, the tax
liability would be reduced to $2Uo.
Special provision would be required to avoid large differences
between the tax on persons just below and just above the exclusion
limits — that is, the limits at which the tax becomes applicable,
f o r a single person without dependents, for instance, the exclusion
amount is $ 500, Those with spendings in excess of $500 would be liable
to a tax of 10 percent on all their spendings, In some cases, in the
absence of a special provision, the tax would be greater than the excess
of their spendings over the exclusion limits. An individual spending
$ 510 , for example, would be subject to a tax of $ 5 1 , whereas if he spent
only $500, he would not be subject to tax. To provide for a gradual
transition between non-taxable and taxable Individuals, it is proposed
that the tax on persons just above the exclusion limits shall not exceed
the excess of their spendings over the exclusion limits, In the illus-**
tration cited, the tax on the single individual spending $510 would be $ 10 .
Refunding of spendings tax
It is suggested that this fla W r a t e spendings tax be made refundable
without interest after the war. The amount collected in the first year
of operation of the tax might be refunded in the first year following
the close of the war? the amount collected in the second year might be
refunded in the second year following the close of the war; and so on.
It might also be desirable to provide for earlier refunding after the
close of the war at the discretion of the. Secretary of the Treasury.
Provision should in any event be made for the earlier refunding of the
tax even prior to the close of the war in cases of proven distress.
The Treasury proposes that the entire amount of the flat-rate
tax be refunded, Howdver, if the Committee should desire to do so, it
is technically feasible to refund the entire tax only to the lower
income groups.
w U
The•Individual Spendings Surtax
X turn now to a discussion of the second part of the spendings
tax, the spending surtax* This tax would be imposed at progressive
rates on expenditures in excess of an exemption of $1,000 for a single
person, $2,000 for a married couple, and an additional $$00 for each
dependent* In contrast to the exclusions under the flat rate tax, these
exemptions provide a minimum of spendings that is free from surtax for
everyone, regardless of the total amount spent»
•
r ' ••
5
",
'V'l ffjff
The spendings would be calculated in the same manner as in thfe case
of the refundable spendings tax -- that is, they would not include such
items as debt repayment, insurance premiums and bond purchases — except
that ^ou may want to consider allowing some extraordinary expenditures
also to be deducted*
Method of collection
,( The tax would be collected currently by requiring individuals to
report the approximate amount of spending at short intervals, say
quarterly, with a final adjustment after the close of the year* The
quarterly report might contain no more than a single item «**• the
approximate amount of spending during the preceding quarter*
Tax rates
The tax rates would be progressive#
schedule is suggested!
Spendings
i
(Brackets)
•
1
o
ifoooT'
1,000 - ) 2,000
2,000 - 3,000
3*000 - 5*000 /
5*000 - 10,000
Over $10.000
The following surtax rate
Tax rate
(Brackets)
io#r
20
30
UO
50
n
.... .
This schedule would apply to a single person in the usual manner*
However, direct application of thiB progressive spendings tax schedule
to a family as a unit would be unduly harsh on large families and would
favor single persons* This follows from the fact that the larger the
■
-
/ ./•
i.
il « ■ ■ ■ I
- 5 -
family, the greater is the necessary amount of spendings and the higher
the rate at which the spendings would he taxed. This difficulty can he
overcome hy putting the family's tax on a per capita basis. The family's
total spendings would he divided hy the number of persons in the family.
The progressive rate schedule would, then he applied to the resulting per
capita spendings. The per capita tax computed in this way would he
multiplied hy the number of persons in the family to get the total family
tax, For this purpose, a dependent child would he counted as equivalent
to one**half a person.
For example, a married couple with one dependent would comprise
2*5 taxable persons, If this family spent $5,000, spendings'‘in excess
of the exemption of $2,500 would he $ 2,500 or $ 1,000 per taxable person.
According to the above rate schedule, the surtax would he $100 per
person, or $250 for the family (2*5 times $100). Married couples would
he permitted to file either joint returns or separate returns, since
discrimination would he avoided hy the method of computing spendings
per taxable person. The amounts and effective rates of tax under the
above rate schedules are shown in Exhibits 2, 2a, 2b and 2c,
Effective date of surtax
The spendings surtax should he made effective as of September 1,
19^ 2. It is essential that this he done in order to prevent large
scale buying and hoarding of consumers' goods in anticipation of the
enactment of the spendings tax. In addition, unless .the spendings tax
is made effective as of the date on which it is announced, individuals
would he given an opportunity to convert their hank deposits into
currency, hoping thereby to set aside spendable funds upon which an
adequate check could not he made. These and similar dangers can he
•prevented only hy making the spendings surtax effective as of
September 1, I9U 2* The corresponding difficulties are not of great
importance with respact to the refundable part of the spendings tax
and this could go into effect January 1, 19^3 •
Reduction of exemptions for the regular income tax
In addition to the spendings tax, the Treasury recommends a
reduction in the personal exemptions under the individual income
tax.
- 6 ~
The exclusions of $500, $1,000, and $250 for the refundable
spendings tax are believed to be desirable in order that a very large
volume of consumer spendings may be brought into the tax base, ,3Tor
purposes of simplicity the income tax exemptions and the refundable
spendings tax exclusions should be the same amounts of income.
Accordingly, it is suggested that the personal income tax exemptions
be lowered to $500 for single persons, $1,000 for married couples, and
$250 for each dependent, This step will-need to be taken in any event
as the impact of the war increases. It represents a $200 reduction in
a married couple*s exemption and a $50 reduction in the amount of the
dependent credit, from the exemptions tentatively adopted by your
Committee.
The proposal would increase the number of taxpayers to some five
million above the estimated number under the exemptions tentatively
adopted by your Committee, Under the rates of H, R, 7378, the lowering
of exemptions would increase the tax liability of a married person
without dependents having an income of $2,000 from $1^0 to $ 178; for
one with an income of $10,000 from $2,152 to $2,220. A married person
with two dependents having an income of $ 2,000 would pay a tax of $83,
whereas with the exemptions under H, H* 7378, he would pay no tax. f o r
a $10,000 income, the tax liability would be increased from $1,880 to
$ 2,056. The amounts of tax and the effective rates for taxpayers with
selected net incomes under present law, under the rates o'f H. R. 7378,
with the proposed lowered exemptions, are shown in Tables 3» 3a* 3^t
and 3c,
The proposed reductions in personal exemptions and credit for
dependents will increase substantially the tax load of those in the
lowest taxable income groups and you may want to consider revising the
surtax rate schedule to reduce the impact on these groups. We should
be glad to submit such schedules for your consideration.
Effect of the Treasury program
The total yield of the proposed program at 19*+2 levels of income
is estimated to be $6,5 billion. Of this amount, $U. 5 billion would
be refundable to tasqmyers after the war.
Examples illustrating the combined effects of the refundable part
of the spendings tax* the spendings surtax and the reduced individual
income tax exemptions for individuals with selected amounts of income
are shown in Exhibits ^ through
Eor example* a married couple with
two dependents having an income of $$,000 would have an income tax
liability of $680. If their spendings amount to $3»800 the spendings
surtax would be $80 and the refundable spendings tax» $380# If their
spendings were only $3,100 the spendings surtax would be reduced to $10
and the refundable spendings tax to $310. Their combined tax would be
$l,lU0 in the first case and $1,000 in the second case. Of these amounts,
however. $380 or $310* respectively, would be refunded after the war.
Effect of the Treasury proposals on
the antltinflatlon program
The spendings tax will raise very substantial amounts of revenue
and will accordingly be valuable in financing the war. More important,
it will be particularly helpful as an anti«*inflation measure in two
ways: (l) by withdrawing consumer purchasing power and thus reducing
the demand for goods, and (2) by creating an obstacle to spending, thus
checking spending and encouraging saving. Because it will apply only
to individual spendings and not to business spendings, it will not
interfere with price ceilings, On the contrary, it will greatly
facilitate the exercise of direct price controls, rationing, and other
methods of combating inflation.
The refundable part of the spendings tax and the spendings surtax
differ in the emphasis placed on these two methods of reducing spending.
The refundable tax, applying to the bulk of total Individual spending
at a 10 percent rate, will be effective primarily by withdrawing
purchasing power. The spendings surtax, on the other hand, is intended
primarily to discourage spending directly, rather than to absorb large
amounts of purchasing power, Eor this reason it is imposed only on
spending above a fairly adequate living level, but at increasingly
heavy rates. Insofar as spendings are not checked, the tax will bring
substantial payments into the Treasury; insofar as they are checked,
inflationary pressure on the price level will be reduced.
Jor these reasons, these taxes should provide a powerful instrument
for combating inflation. Moreover, they provide an adjustable instrument
which, once put in operation* can be increased.or decreased as the
current economic situation requires.
- g -
Like any new tax, and perhaps more than some taxes, a spendings
tax necessarily involves administrative and compliance problems.
These problems are reduced by the fact that a spendings tax can be
administered in conjunction with the individual income tax. As a
consequence, the refundable tax will require no additional returns,
and the collection of the refundable tax at source will impose no
additional burden on either withholding agents or the Bureau of
Internal Revenue. Nevertheless, the spendings tax will create an
administrative problem in checking on information not now required
on income tax returns, in familiarizing the public with a new type of
tax, and in helping the public to fill out the forms that they will
be required to submit. Compared with other measures of like importance
in meeting the inflation'and revenue problems, the administrative
difficulties should not prove disproportionately large, In time of
war, administrative difficulties cannot be allowed to stand in the way
of measures vital to the Nation*s welfare.
I
Exhibit 1
The Individual Spendings Tax Schedule
(To ho used by persons subject to the spendings surtax and by persons not.
eligible to use simplified income tax return. A simplified spendings tax
schedule will be available to all other persons subject to the spendings
tax*)
Funds at the disposal of the individual
1*
Salaries, wages, and other compensation for personal services,*.
2.
Dividends and interest received, including government interest.*
3*
Rents, royalties, annuities, pensions
4*
Withdrawals from business, professions, partnerships, trusts,..*
5,
Cash receipts from gifts, bequests, and insurance.* .............
6.
Receipts from sale of capital assets ............r............
7*
Receipts from repayment of loans made to others ................
8*
Receipts from borrowing, including debts incurred on
installment purchases•*••*»**,*•*»••*»*»••*•«•**,** *
9.
10.
11 .
*
*
Cash and bank balances at beginning of year*,***,**......
Other r
e
c
e
i
Total disposable funds
Deductions{
(items
p
1
t
s
.
*
to 10)....»................
Cash and bank balances at end of year...,..,**.**.,*.*♦*,...,..*
13.
Cash gifts and c
14f
Interest and taxes paid, except on owner-occupied homes.
15*
Expenditures on the purchase of capital assets*,*,*..*...*♦,.*.*
IS,
Life insurance premiums, annuity, and pension payment.,*;,*.,.,.
17*
Outlays for repayment of debt, including installment debt*...,.*
18.
Loans made to others#.*,
19.
Other nontaxable disbursements.
21*
o
Total deductions
n
ijT
Fon-taxable use of funds
12.
20*
$
t
(items
Expenditures subject to tax
r
i
b
u
t
i
•
12
to 1
o
n
s
*
$
*
•
9
)
,
*
(item 11 minus item
,
*
.
,
20)...... .
,
$
$
Exhibit
2*
Individual Snendings Surtax:
Expenditure
per taxable
person
(Bracket1.
:
:
:
:
«
Surtax rate
(bracket)
♦
•
• ■
{
0 - $1,000
1,000 - 2,000
v k
2,000
3,000
30
3,000 - 5,000
5,000 - 10,000
Over 10,000
40
30
75
$
Hates and amount of surtax
20
Cumulative surtax
per taxable person
at upper limit
. of bracket
$
100
300
600
1,400
3,900
-
Exhibit
2a
Refundable spendings tax and spendings surtax:
Amount of tax and tax as per dent of spendings
Single person - No dependents
Exclusion for refundable tax
500
Exemption for' surtax
'
• - 1,000
*
Total tax
Surtax as.
Total spendings:
Amount of tax
before
: Refundable: Surtax: Total :percent of i as percent of
spendings
tax
:
* t o . ,?spendings :
exemption.
:
$
500
800
1 ,000'
1,200
1,500
,
*
0
80
100
120
150
2,000
200
2,500
3,000
3*500
250
300
350
400
500
600
800
4,000
5,000
6,000
8,000
10,000
1,000
15,000
1,500
20,000
2,000
25,000
50,000
2,500
5,000
$
0
0
0
20
50
100
200
300
450
600
1,000
1,400
2,400
3,400
6,900
10,650
14,400
33,150
$
0
80
100
140
200
0i
.0
0
10.0
1« 7
3,3* •
5.0
300
8.0
450
10.0
600
800 ■ 12.9
1,000 15.0
20*0
1,500
2,000 23,3
30.0
3,200
4,400
34.0
46,0
8,400
12,650
53.3
16,900
57.6
38,150
86,3
’ 10,0
11.7
' 13,3
15.0
• 18.0'
20.0
~ '• • • 22.9
25.0
30.0
33.3
40.0
44.0
56,0
63.3
67.6
76,3
Il
Exhibit 2b
Refundable spendings tax and spendings surtax:
■Amount of tax and tax as per cent of spendings
Married person - Ho dependents
Exclusion for refundable tax
Exemption for surtax
- $1,000
2,000
^Surtax as : Total tax
Amount of tax
Total spendings :
:Refundable :
Surtax :
Total :percent of: as percent
before
: ' tax :spendings :of spendings
execution
:
tax
:
$
1,000
1,500
$
0
150
2,000
200
2,500
250
300
350
400
500
600
3,000
3,500
4,000
5,000
6,000
. 8,000
.10,000
15,000
20,0p0
25,000
50,000
800
1,000
1,500
2,000
2,500
5,000
$
0
0
0
50
100
150
200
400
600
1,200
2,000
4,300
5,800
10,050
28,800
$
0
150
200
300
400
500
600
900
Q%
0
0
2.0
■ 3.3
4.3
5.0
8.0
10.0
1,200
2,000
15,0
3,000
5,800
8,800
.12,550
33,800
28.7
34.0
40,3
57*6
20.0
0$
10.0
10.0
12.0
13.3
14.3
15.0
18.0
20.0
25.0
30.0
38.7
44.0
50.2
67.6
Exhibit 2c
Refundable spendings tax and spendings surtax:
of tax and tax as percent of spendings
Amount
Married person .<* Two dependents
Exclusion for refundable tax ** $1,500
Exemption for surtax
• - 3*000
Total spendings:
|.
Amount of tax
before
« Refundable; Surtax ; Total
— exemption
;
tax..
? ________ 1
tax
$ 1,500
2,000
2,500
3,000
3,500
4.,000
5,000
'6,000
8,000
10,000
15*000
20,000
25,000
50,000
$
0
$
0
$
0
200
0
200
250
0
250
300
0
300
350
50
400
.400
100
500
500 '
200
700
. 600
, 300
900
800
, 1,500
700
.1,000
1,200 ;•
2,200
1,500
.4,500
3,000
2,000
5,200
% 7,200
2,500
. 7,700
10,200
5,000
24,450
29,450
Surtax as :
Total tax
« percent of 5 as percent
: spendings : of spending
0 i
0
..... 0
0
1*4
2,5
’ 4.0
5*0
8.8
.12.0
20,0
26,0
-30.8
48*9
'
:'0 i
10,0
10,0
10.0
11*4
12*5
.14.0
15.0
,18.8
‘ J33.0
-.30.0
36.0
40*8
58,9
Exhibit 3
Comparison of individual surtax rate schedule under
present law and H* H* 7373
*
Surtax ne4U
income
(000)
••
Bracket rate
t
**
Present. *. t
— J■
•*•
law
: H.R. 7378 :
l
••
%
♦>
$
2
4
6
8
10
12
14
16
18
20
22
26
32
*■“
**
-
38
44
50
60
70
80
90
100
150
200
250
300
400
500
750
1,000
,2,000
5,000
- .
~
**
-
and
2
4
6
ß
10
12
14
16
18
20
22
26
32
38
44
50
60
70
BO
90
100
150
200
250
300
400
500
750
1,000
2,000
5,000
over
.
it,
,
,
.
.
6 .. ,
9 iV
13
17 *
21
25
OQ/
32
35
38
41
44
47
50
53
55
57
59
61
63
6*4
65
66
67
jt.O
Oy
, 71
72
- 73
74
75
76
. 77 •
Total surtax cumulative
Present s
law
t
K.R. 7378
t
120
13
16
300
20
560'
90.0
24
28
1,320
32
1,820
36
2,400
40
3,040
43
3,740
4,500
4b
5,320
49
52
7,080
9,900
55
58
12,900
16,080
61
19,300
63
66
25,000
30,980
69
72
37,080
75
43,380
49,700
77
82,280
79
81
115,280
82
148,780
82
183,280
82
254,280
82
326,280
82
508,780
82
693,780
82
1 ,443,780
82
• 3 ,723,780
82 .
260
530
■980
1,460
2,020
2,660
3,380
4,180
5,040
5,960
6,940
9,020
" 12,320
15,800
19,460
23,240
29,840
36,740
43,940
51,440
59,140
98,640
139,140
180,140
221,140
303,140
385,140
590,140
•795,140
1,615,140
4,075,140
—
Exhibit 3a. Amount of individual income tax and
effective rates under present law, H. ft* 7378,
and H. R. 7378 with' lowered exemptions.
Single person - No dependents
Personal eicemptions
: •
Net income
before
personal
exemption 1 /
:
:
f Present
•
law
*
------------5.......
700
800
900
#
2,000
2,500
50,000
5,000,000
.'formal tax
rate (percent)
Effective rates,
8
sl|# R, 7378
iwith lowered
1 exemptions
I
t
15
34
52
71
89
40
69
117
165
1,500
100,000
500,000
1 ,000,000
*
sH* R* 7378
11
21
1,000
1,200
3 ,ooo
4 ,000
5,000
6,000
8,000
10,000
15,000
20,000
25,000
Amount of tax
-,
- §
«
-3
50Ô
600
Present law
~ § 750 *
H. R . .7378 , •
r 500 Treasury proposal- 500
221
15
34
52
71
89
126
126
181
273
365
472
181
273
365
472
347
483
649
1,031
1,493
2,994
4,929
r*i OO /
( p #4<44*
. 20,382
53,2 U
345,654
733,139
3,923,124
686
686
920
1,174
1,742
2,390
4,366
6,816
9,626
25,011
64,641
414,616
854,616
4*374,616
920
1,174
1,742
2,390
4,366
6,816
9,626
4
6
4/ Maximum earned income assumed.
2 5 ,8 11
64,641
414,6l6
854,616
374,616
5
Present :
rH.R.7378
law
sH. R. 7378 ?vdth low•
jered ex....... î
jemotions
Percent
Percent
.*4
2.5
4.9
1*2
2 .1
3*3 ;
4*6
5.9
6 .6
7.4
8.7
9.7
10 .G
12.9
14.9
20.0
24.6
28.9
41.8
53.2
69.1
73.3
78.5 .
,
Percent
*
6 .5
7.3
8.9
' 10.5
‘
2*5
4.9
6.5
7.8
8*9
10*5
1 2 .1
12*1
13.7
14*6
15.7
17.2
18.4
19.6
13*7
14*6
15*7
17*2
18.4
19.6
2 1,8
21.8
23.9
29,1
34.1
38.5
51.6
23.9
29.1
34.1
33.5
64*6
51,6
64.6
82 #9
85.5
87.5
82.9
85.5
87.5
6
6
Exhibit 3b
Amount of individual income tax and effective
rates under present law, H. R. 7378» and
H. R, 7378 with lowered exemptions
Married person - Ho dependents
Personal exemption:
‘
Het income
t
Amount of tax __
:
Effective rate"
: H. R. :
H, R. 7378:Present V H , 1B. : H. R, 7378
before
iPresent
personal
.: * law
*....
exemption 1/ *
$
: 7378
#
•
: with lowered:
law
: 7378 iwith lowered
f
•
: <exemptions :
1
t exemptions
Percent Percent
Percent
<**»
1,000
1,100
1,200
■**
- $
1,300
1,500
$
«
- $
**
13
31
Hg
68
86
10 H
lHl
178
13
1,U00
i,6oo
1,800
Present law
**$1,500
H. R. 7378
- 1,200
Treasury proposal** 1,000
6
30
US
66
23
103
2,000
b2
iHo
2,500
232
90
270
3,000
138
32H
362
H ,000
2H 9
576
532
5,000
7H6
790
375
.
6,000
1 ,0HH
992
521
8,000
1,532
873
1.5 9 2
10,000
2,220
•
2 ,15 2
1.305*
. 15,000
H.052
H .136
2,739
, 20,000
U,6lU
6 ,1*52
6,556
' 25.000
6 ,8bU
9 .220 ,
9.336
. 50.000
20 ,1*39
25,328
25 »H66
.■■100,000
52,701*
6U,o 6o
6H ,226
500,000 . 3U5.08U
HiH , 000
HlH,i 76
1 ,000,000
S 5 H ,000
851*.176
732.55>*
5 ,000,000
3.922,521* H,37H,000 u.371+,176
Hormal tax
ra,te (percent)
1/
U
6
Maximum earned income assumed.
6
»
m
m
m'
0,H
1*3
2 .1
3*6
H ,6
6.2
7.5
8.7
10 .9
13*1
is . 3
2 3.1
27*5
Ho . 9
52,7
69.O
73-3
78,5
H .
1.0
2.1
3*2
H.l
5*7
7*0
9*3
10 .8
13*3
ii*.9
1 6 ,5
19*2
2 1.5
27,0
32.3
36.9
50.7
6H . 1
82.8
85 .H
87.5
6
1.2
2.6
3-8
H.9
5*7
6.5
7*8
8*9
10 .8
1 2 .1
‘lH.H
1 5 .8
1 7 .H
19*9
22.2
27.6
32.8
370
50*9
6H .2
82.8
85 .H
87.5
6
Exhibit 3c# Amount of individual income tax and effective- rates
under present law, H. R, 7378, and H. R. 7378
with lowered exemptions
Married person
two dependents
Personal exemption«
Present law
H. R. 7378
Treasury proposal
- $1,500
> 1,200
«• 1,000
Dependent credit;
Present law
H* R. 7378
Treasury proposal
- $
-
400
400
250
Net income ('-•I
Amount of tax
Effective rate
before
Present ; H.R, 7378 iH.R* 7378 {Present H.R. ,7378 iH.R. 7378
■personal ex**
emptiou: ] J
•
law *
«with loi î law
iwith low**
tered' exeinpm
;ered exenrpttions
itions
Percent
$
1,500
1,600
1,700
1,800
1,900
«
2,000
2,100
2,200
2,300
2,400
2,500
3,000
4,000
5,000
6,000
8,000
10,000
15,000
20,000
25|000
50,000
100,000
500,000
1 ,000,000
5,000,000
$
mm
**
$
12
4
13
28
46
65
83
101.
-
5
Percent
mm
$
58
154
271
397
717
1,117
2,475
4,287
6,480
19,967
52,160
344,476
731,930
3,921,884
Normal tax
rate (percent)
1/
Percent
'
13
26
120
43
138
62
157
80
175
172
267
356
466
570
680
784
914
1,292
1,442
1,880
2,050
3,716
3,926 ,
6,036
6,296
8,756
9,046
24,776
25,121
63,396
63,811
413,296
413,736
853,296
853,736
4,373,296 4,373,736
6
Maximum earned income assumed#
6
„
-
«M
mm
mm
m
—
•
—
0.3
0*5
1*9
3.9
5.4
6.S
9.0
11.2
16.5
21 #4
25.9
39.9
52.2
68.9
73.2
78.4
4
0.6
1.2
1.9
2.6
0,8
1.6
2.6
•3,4
4.3
4.8
. 5.5
6.0
3.2
5.7
8.9
11.4
13.1
16.2
. 18.8
24.8
30.2
35.0
49.6
63.4
82.7
85,3
87.5
6.5
7.0
8.9
11.7
13,6
15.2
18.0
20.5
.26,2
31.5
36.2
50.2
63.8
82.7
85.4
. 87.5
6
6
Exhibit 4* Illustration of the combined effect of the
income tax» spendings surtax» and refundable spendings tax
Income $ 2 »500
- - -
■ - -
— —t—
~r
,
-1- ,
-- -
; ,--V-
-
'
- -rr , n r
¿Single persoa;Married couple ¿Married couple
1 Ho dependents¿No dependents ¿Two dependents
$1,700
Assumed spending on consumer goods and.services
Income tax (H* R, 737® with lowered exemptions) i f
Spendings surtax
Income, tax and spendings surtax; .Amount
, .•
As a percent of income
Refundable tax
.
365
70
Exemptions;
365
2T0
... 3 0 .
'•*35
■
170
.130
525
$1,700
$1,500
$2.»100
270
175
m
175 .
175
**
270
395
15*356 10*8#
17.¥
Total, income tax,; spendings surtax and refundable tax;
.Amount - . ,f
.
,
.
- 605
As a percent of income
2k . 2#
if
$ 1»300 $1,900
190
46o
21.00 ’ 18,4#
270
10.8#
1 . 0$
150
am.r.
420
16.8#
385
15.
Single person, $500; Married couple, $1,000;' eacH dependent, $250»
7.00
'HQ
3^5
13.8$
Exhibit Ua, Illustration of the combined effect of the
income tax, spendings- surtax, and refundable spendings tax
Income $5*000
— ■
- ,
....... .,.-
________
Assumed spending on consumer goods
said services
Income tax (H.R* 7378 with lowered
exemptions \ J )
Spendings surtax
Income tax and spendings surtax;
Amount
As a percent of income
Refundable tax
Total, income tax, spendings
surtax, and refundable tax:
Amount
As a percent of income
1/
Exemptions:
i
Single person
» -Ko dependents
i
:
Married couple
Kp dependents
;
r
Married couple
Two dependents
$3*200
$2,500
$3,500
$2,800
$3,800
$3,100
920
360
920
200
790
790
680
80
680
1*280
25.65*
1,120
22,*$
'
-.-JgQ
1,600
32*056
-..250
1*370
27.¥
___ m
SO
9k0
$70
18*8#
11 M
___ m
1,290
25*8#
,
280
1,150
23.0£
10
760
690
15*2$
13-8iS
380
310
X t iM
22*8$
1,000
20,0#
Single person $500* married couple $1,000» each dependent $250*
M :,
p
i.
—
^
«W
i*M
irl
Exhibit 4b* Illustration of the combined effect of the
income tax, spendings surtax and refundable spendings tax
Income $10,000
Single person
No dependents
Assumed spending on consumer goods and service s
Income tax (H. R* 7378 ■with lowered
exemptions 1 /)
Spendings surtax
Refundable tax
Total, income tax, spendings surtax, and
refundable tax:
Amount
As a percent of income
Exemptions:
4,000
3,390
2,390
.. 600
JL38S
Income tax and spendings surtax:
Amount
As a percent of income
2/
$ 5,500
* Married couple
* No dependents
$
3,590
35.^
2,990
29.9$
550
4,140
41*4$
6,000
$4,500
2,220
2,220
600
300
2*,820
*
’ Married couple
* Two dependents
$ 6,500 '$ 5,000
2,050
400
2,050
2,250
22.6$
28*2$
2,520
25.2$
2,450
24.5$
400
600
450
650
5,390
33.9$
3,420
34, 2$
2,970
29.7$
3,100
31*0$
200
500
3,750
27.5$
Single person, $500; Married couple, $1,000 ; each dependent, 1250.
» 052$
»UB - p n o J e p
xio r i o
■OOO*
>X«=Crxc»s>
p e p jcjce n i
* 0 0 5 $
: s t i o t a^nxQ'aciit
Exhibit 4c, Illustration of the combined effect of the
income tax, spendings surtax and refundable spendings tax
Income $25,000
•
*
:
Assumed spending on consumer
goods*and services
Income tax (K.R. 7378 with
lowered exemptions I/)
Spendings surtax
Income tax and spendings
surtax?
Amount
As a percent of income
Refundable tax
Total, income tax, spendings
surtax, and refundable tax:
Amount
As a percent of Income
1/
Exemptions:
Single osrson
No dep endents
# 10,000
#
6,000
*
:
Carried couple
No dependents
# 11,000 ' $ 7,000
i
•
♦
Married couple
Two dependents
118,000
#
8*000 7
9,626
9,626
9,336 -
9,336
9,046
. 3,400
1,400
. £,.400 .
1,200
1,800 .
13,086
58.1Î
11,026
4 4 .1 %
11,736
46.9*
10,536
42.1*
10,846
43.4*
9,7.46
39;o*
1,000
60Ô
1,100
700
1,200
800
14,026
56.1*
11,626
12,836
51. 3*
11,236
44.9*
12,046
48.2*
■10,546
48.8?
46.5*
Single person $500, married couple $1,000, each dependent #250
9,046
700
Exhibit 4d. Illustration of the combined effect of the
income tax, spendings surtax and refundable spendings tax
Income $100,000
: Single person
: Ho dependents
J Married couple
: Ho dependents
:
»
Married couple
Two dependents
$16,000
$11,000
$18,000
$13,000
Q
o
0IS
$15,000
Income Tax (R*E. 7378 with lowered
exemptions 1/)
Spendings surtax
64,641
7,650
64,641
3,900
64,226
5,800
64,226
3,300
65,811
5,200
63,811
Income Tax and Spendings Surtax;
Amount
As a percent of Income
72,291
72. 3$
68,541.
68.5$
70,026
70.0$
67,526
67*5$
69,011
69.0$
66,811
66*8$
1,600
1,100
1,800
1,300
2,000
1,500
73,891
73.9$
69,641
69.6$
71,826
71.8$
68,826
68.8$
71,011
71.0$
68,311
68*3$
Refundable Tax
Total, In c o m e tax, spendings surtax,
and refundable tax:
Amount
As a percent of Income
1/
Executionst
1
Assumed spending on consumer goods
and services
Single person, $500$ Married couple, $1,000; Each dependent, $250.
3,000
Supplement to the statement of ^Randolph 3S* Paul,
General Counsel of the (Treasury Department,
before the Senate Pittance Committee
in Executive Session,
in support of the recommendation of the
Secretary of the treasury for an additional
* war-time revenue program
Ih Connection with the formulation of the comprehensive antiinflation tax program outlined by the Secretary, we have given careful
consideration to all possible alternative tax measures* One alternative
that deserves special mention.because of the widespread attention it
has received is thé general sales tax*
in our view,*the spendings tax is distinctly preferable to a
general shies tax for the following reasons?
1 * The spendings tax can completely exempt individuals with a.
low standard of living* 2he sales tax cannot provide such an exemption,
except in an indirect, partial and unsatisfactory fashion by exempting
whole classes of goods, such as food* A sales tax will exempt alike,
or tax alike, the liberal purchases of a commodity by the well-to-do
and the limited purchases of the same commodity by the needy. Hhe
exemption of individuals with very low standards of living is important
in the interests not only of fairness but also of the war effort, w©
can ill afford to impose taxes that would so reduce the standard of
living of many individuals as to inpaitf their productivo efficiency.
2* Uhe proposed spendings tax is imposed at rates graduated
according to the amount an individual spends* For this reason it can
be truly effective in curtailing consumption at all income levels. A
sales tax cannot be graduated, except very crudely in terms of classes
of commodities* It is therefore impossible to impose a sales tax at
sufficiently high rates to discourage luxury spending without at the
sane time imposing an intolerable burden on the great masses of-the
people. In short! a spendings tea can he more selective in its impact
on consumption than a sales tax*
3,
A sales tax, even if levied at the retail level, would in
■practice have to be paid by business firms on some types of purchases.
It would therefore enter into costs of production with resulting pressure
against price ceilings. In addition, it would
difficult to impose a
sales tax without affecting parity prices of ¿ana products* A spendings
tax would have neither of these effects, since it is collected directly
from individuals*
-
2
-
k • The spendings tax proposed will reach as large an amount of
consumer spendings as a retail sales tax without exemptions, and a
considerably larger amount than a retail sales tax with food exempt.
It will do so despite the. fact that the spendings tax exempts completely
individuals with low standards of living* The reason for this difference
between the two taxes is that a spendings tax can include services pur
chased by consumers while it is administratively extremely difficult to
include such services in a retail sales tax. Out of total consumer
spendings of $75 billion* the spendings tax will reach over $50 billion.
A retail sales tax .on all tangible commodities will reach about the
sane amount; a retail sales tax with food exempt will reach only about
$52 billion*
5* Despite the popular belief to the contrary, the retail sales
tax is not an easy tax to administer* On a Federal level, it is an
entirely new addition to the tax structure, involving the creation of
new administrative machinery* The spendings tax will admittedly in
volve administrative difficulties of its ovm. But these are no
greater than those that would«rise under the sales tax and the spendings
tax has the great advantage that it can be integrated with the fully
developed administration of the individual income tax.
PRESS RELEASE
September 2. 1942
The Bureau of Customs announced today that provision; will be made
at customs ports of entry to enable importers to file entries and with
drawals covering cotton and cotton waste subject to the quota provisions
of the Presidentas Proclamation of September 5, 1939, as modified, at
the same instant of time^at the opening of the new quota year on Septem
ber 21, 1942, at 12 noon, EOT, 11 a.m., COT, 10 a.m., MWT, and 9 a.m.,
POT.
The acceptance of entries and withdrawals for consumption covering
quota-class cotton and cotton waste will be authorized within the quota
limitations in the order of the time of their presentation in proper
form at the customhouse in the port where the merchandise has arrived*
If entries and withdrawals for consumption presented at the hours spe
cified above on September 21, 1942, cover a total quantity of cotton
or cotton waste in excess of the quotas provided for, the quantity which
may be admitted to entry within the quota will be prorated on the basis
of the quantity presented for entry*
-oOo-
TREASURY DEPARTMENT
Washington
FOR I M M E D I A T E R E L E A S E
Thursday, S e p t e m b e r 3» 19^1
P r ess
No.
Service
33~$
The B u r e a u of Customs a n n o u n c e d today that p r o v i s i o n
w ill be made at customs ports of entry to enable
to file entries and w i t h d r a w a l s
waste
c o v e r i n g cotton and c o tton
subject to the q u ota p r o v i s i o n s of the P r e s i d e n t ’s
P r o c l a m a t i o n of Sep t e m b e r 5»
same
Importers
instant
of time,
year on S e p t e m b e r 21,
10 a.m.,
MWT,
1939>
as modified,
at the
at the o p e n i n g of the n e w q u ota
19^-2,
and 9 a.m.,
at 12 noon,
EWT,
11 a . m . , CWT,
PWTf
The acc e p t a n c e of entries and w i t h d r a w a l s
for c o n
sumption c o v e r i n g q u o t a-class c o tton a nd cott o n w a s t e w i l l
be a u t h o r i z e d w i t h i n the quota l i m i tations
of the time of their p r e s e n t a t i o n
customhouse
in p r o p e r f o r m at the
in the port w h e r e the m e r c h a n d i s e has arrived.
If entries a n d w i t h d r a w a l s
the hours
in the o r der
for c o n s u m p t i o n p r e s e n t e d at
s p e c i f i e d above on Sep t e m b e r 21,
total q u a n t i t y of cotton or cotton w a s t e
quotas p r o v i d e d for,
19^2,
cover a
in excess
of the
the qu a n t i t y w h i c h may be a d m i t t e d
to entry w i t h i n the quota wil l be p r o r a t e d on the basis
of the q u a n t i t y p r e s e n t e d for entry.
-*o0o-
Statement of Secretary Morgenthau
before the Senate Finance Committee,
Thursday, September 3, 1942.
I
have come before you today with a program to
raise substantial additional sums to finance the war
effort.
I intend to leave the details of the presenta
tion to Mr. Paul and his associates and to limit myself
to emphasizing the gravity of the situation as I see
it and the imperative need for legislation along the
lines we are suggesting.
Up to this point our huge war expenditures have
been financed in an orderly way and with a minimum of
inflationary effects.
But the more successful the war
production program becomes, the greater are the
dimensions of the fiscal problem we have to face.
We
have to plan for expenditures of $80 billion in the
present fiscal year, while the revenue in sight on the
basis of the tax bill now before you is only approxi
mately 24 billions.
The Treasury has diligently sought and will
continue to seek funds from those sources where
borrowing will have the least inflationary effect,
33-9
-
2
-
and we have done so with what I believe to be most
gratifying results.
We can foresee with confidence
provision for the Government’s fiscal needs for the
remainder of this calendar year.
But I am here today to tell you frankly that I
need your help in the form of legislation which will
enable me to meet, with the same degree of confidence,
the much greater problem of raising the necessary funds
for next year.
The legislation which we are proposing has a
double purpose.
The first purpose is to draw into the
Treasury substantial additional* funds out of the
earnings and savings of the people.
is even more important.
The second purpose
It is to reduce consumer
spending directly by withdrawing funds otherwise
available for expenditure, and to reduce it also
indirectly by creating a strong tax incentive to
saving.
The measures we propose are two:
first, a tax
on consumer spending which will reach into the lowest
income groups above the level of bare subsistence
- 3 -
income and will provide high penalty rates for luxury
spending; second, a further lowering of the exemptions
from the income tax applying to family income•
The two proposals will reach into incomes aggre
gating some 65 billions of dollars and will draw into
the Treasury an estimated six and a half billion dollars
otherwise available for consumer spending.
But of this
total some four and a half billions, although raised as
a tax, will be treated not as revenue but as a debt to
the individuals from whom it was collected, to be repaid
after the war.
Revenue is not the sole purpose, nor even the
primary purpose, of either of these proposals.
Their
main purpose is to restrict consumer spending so that,
as far as possible through fiscal means, we may avoid
the perils of inflation in the huge financing program
that we have ahead of us.
It can be expected that the new spending tax will
reduce in many individual cases the amounts which
workers can afford to set aside for War Bonds under
voluntary payroll deduction plans.
In the face of
- 4 -
present conditions we can no longer afford to rely
entirely upon voluntary lending.
The new proposals
are intended, therefore, to supplement the voluntary
bond purchase program.
It is my belief that the voluntary War Bond
program has produced and will continue to produce a
great contribution to the nationfs war effort.
This
is due to the unselfish service that hundreds of
thousands of men and women throughout the country have
given to it.
They deserve the thanks of the nation
for the magnificent work they have done, are doing,
and will, I hope, go on doing, in encouraging the
American people to put their dollars to work for their
country.
The voluntary War Bond program will, of
course, be continued.
Our present and urgent problem is to borrow the
great amounts that will be needed to finance the war
effort in ways that will not contribute to inflation.
Inflationary pressure is created by consumer demand
exceeding the supply of goods available.
The Treasury
is seeking in these proposals to attack the problem at
its roots and to attack it drastically.
*
fe
- 5 -
The control of prices is of course not exclusively
a fiscal problem.
But with full allowance for all that
can be done through price regulation, rationing and
other devices to control supply, I think that we, who
are jointly responsible for tax policy and legislation,
shall be doing very much less than our full duty if we
do not deal with the problem as effectively as possible
in the fiscal field.
—
What I have presented is a method
and the best method the Treasury has been able to
devise —
for accomplishing this result.
If the proposals we make seem drastic, I should
like to say with all possible emphasis that I believe
nothing less drastic will accomplish the results we
must have.
This is no time for half-way measures.
With the fullest respect for the Committee on
Finance, but with a strong sense of our joint
responsibility in these critical times, I do not
merely recommend bold action along these lines; I
request it and I urge it most seriously, and with the
profound conviction that it must be done.
September t 19**2.
3 3> — / o
STATUTORY DEBT LIMITATION
AS 07 AUGUST 31, 19^-2
Section 21 of the Second Liberty Bond Act, as amended, provides that the face
amount of obligations issued under authority of that Act, “shall not exceed in the
aggregate $1 2 5 ,000 ,000,000 outstanding at any one time.“
The following table shows the face amount of obligations outstanding and the fM l
amount which can still be issued under this limitation:
Total face amount that may be
outstanding at any one time
$1 2 5 ,000 ,000,000
Outstanding as of August 31* 19**2:
Interest-bearing:
Bonds $ 1+1 ,lug, 1 7 1 ,6 5 0
Treasury
Savings (Maturity
value)*
1^.372,739.075
Depositary
SS.191+,000
Adjusted Service
72 6 ,9 3 7 ,7 5 7
Treasury notes
Certificates of
indebtedness
Treasury bills
(Maturity value)
$56,606,0*+2,1+82
1^,870,176,575
8 ,025 ,095,000
**,168,152,000
S3,669; **66,057
Matured obligations, on
which interest has ceased
76,622,600
'ace amount of obligations
issuable under above authority
83,7*+6,088,657.i
$ **1,253,911,
Reconcilement with Dally Statement of the United States Treasury
August 31,T9ÏÏ2
Total face amount of outstanding public debt obligations
issued under authority of the Second Liberty Bond Act,
as amended
Deduct, unearned discount on Savings bonds (difference
between current redemption value and maturity value)
$ 83,7*16.088,651
2,621,575.976+
8 1 ,121+,512 ,6SP
Add other public debt obligations outstanding out not
subject to the statutory limitation:
Interest-bearing (Pre-War, etc.)
$
195,969,620
Matured obligations on which interest
has ceased
1 0 ,72**,765
Bearing no interest
353,920,598
Total gross debt outstanding as of August 31, 19**2
56o .6i *+,983
$ 81,685,127»^
* Approximate maturity value. Principal amount (current redemption value)
according to preliminary public debt statement $ 1 1 ,7 5 1 ,16 3 ,099 .
and t
Total
September 4, 1942.
STATUTORY DEBT LIMITATION
AS OF AUGUST 31. 1942
Section 21 of the Second Liberty Bond Act, as amended, provides that
the face amount of obligations issued under authority of that Act, "shall
not exceed in the aggregate $l25,00Ü,dd0,Û00 outstanding at any one time."
The following table shows the face amount of obligations outstanding
and the face amount which can still be issued under this limitation:
Total face amount that may be
outstanding at any one time
$125,000,000,000
Outstanding as of August 31, 1942:
Interest-bearing:
Bonds Treasury
$41,418,171,650
Savings (Maturity
Valued14,372,739,075
Depositary
88,194,000
Adjusted Service
726.937.757 $56,606,042,482
Treasury notes
Certificates of
indebtedness
Treasury bills
(Maturity value)
14,870,176,575
8,025,095,000
4.168.152.000
Matured obligations, on
which interest has ceased
27.063.423.575
83,669,466,057
76.622.600
Face amount of obligations
issuable under above authority
83.746.088.657
$-41,253.911,343
Reconcilement -with Daily Statement of the United States Treasury
August 31. 1942
Total face amount of outstanding public debt obligations
issued under authority of the Second Liberty Bond Act,
as amended
$ 83,746,088,657
Deduct, unearned discount on Savings bonds (difference
between current redemption value and maturity value)
2,621,575.976
81,124,512,681
Add other public debt obligations outstanding but not
subject to the statutory limitation:
Interest-bearing (Pre-War, etc.)
$ 195,969,620
Matured obligations on which
interest has ceased
10,724,765
Bearing no interest
353.920,598
Total gross debt outstanding as of August 31, 1942
560,614.983
$ 81,685.127.664
-'<■Approximate maturity value. Principal amount (current redemption value)
according %o preliminary public debt statement $11,751,163,099.
33-10
•10~
o«sn*t that put It in a nut-shell?
Isn't youth and
life and the chance to make a better world^ the stake that each of us
2 £ s n ’ t' " ffs .■&£**■ ■
ha® in winning'^« ear?
we are asked to make
<5 " S a r e & M *
sacrifices here on the horse front# ilas^sjls wh^ our young men
have gone out to fight on the battlefields of the world*
e President
spoke for all of u® her^ tonight
, - LA
ith e n
We cannot win this kind of war with »living as usual» any more
than with »business as usual»*
sacrifies, hard sacrifies —
For each of usf that means real
sacrifice
hurts*
We taMP*
had to give up »business as usual», and here on the home front we*fc*
( J jJ - - k ( u j^ ih
^living as usual»*
And the quicker we give It up,
the easier ihe transition içLll bfj and the faster we will get on
with the
3©b of winning the war*
L e z f
Ip new
.-.
LA.
of us 1H P F p e r seaall^at stake in
<*&*&** *
In his speech to the students, which was shortwaved to our
fighting forces all over the world, the President promised that
»this time we shall know how to make full use of victory» to
build a better world*
Be stated the truth for all of us when he declared that »the
Basis, the Fascists and the militarists of Japan have nothing to
offer to youth /4xeept death*»
And the President described the
cause of the United Nations as »the cause of youth itself»*
-8-
are buying bonds here In Hew Hampshire — ■ye»*
record proves that#
reare
But we have not put bond« first on our budget#«
still buying bond« with our surplus income«
cut
% r fine
into our living expenses*
1«
We have not
have not yet
substituted bonds for the purchases we'seas Ho without*
Nobody needs to sheer New Englanders how to scrimp and save«
v
Hampshire#
England thrift
It was
New Hampshire pioneere going out to settle the west, who helped
create the homespun pioneer slogan. "Bat it up — >wear it out —
*
*. /
it do*"
That is the spirit we need a«k on the horn® front*
the spirit in which we must buy bonds —
That is
bonds instead of luxuries,
bonds instead of pleasures, bonds instead of all the easy and
comfortable things we can
do without#
Only last week, in an address to an International student
assembly in Washington, President Roosevelt once more warned us
that this war is "going to be long and hard and bitter**
the Railroad Brotherhood«, like the other great labor organisations,
are doing a tremendous job in encouraging their member« to sign up on
payroll savings plans*
In this connection, I should like to make special mention of
the record made by the employee« of the Boston and Maine Railroad,
who are setting an example to .every railroad man in the country
and doing a job no other railroad has surpassed*
And what about us here on the home front?
Gan we truthfully
say that we are now putting IQQg of our effort into backing up
the fighting lines and the production lines?
Our country spent nearly $5 billion on m & w s fr s55idk in August•
But our purchases of Sar Bonds fell far short of the national
quota*
Is that our best effort on the home front?
news our
Is that the kind of
Hampshire boys in Egypt and in Iceland and in
Australia ought to hear fro® home?
I s^y to you with a deep sense of conviction, with all the
'"PtzJuS"
earneatneas in ay power, thaVfane of ua have yet begun to make
the aaoriflcee
necessary
to win
this war.
Oar country is demanding of our soldier« and sailors, not 10$,
but
100 $ of everything they*ve got —
including their very lives*
Our country is expecting our ear workers to deliver
skill and their effort —
and to buy bonds besides*
100% of their
And our war
/
workers are doing Jurfc that*
The American Federation of Labor
*<2j?
W xy'
has pledged that its members iwSgri^buy a billion dollars worth of
bonds during this year*
This pledge is already considerably
ahead of quota and President Green says it will be much more than
fulfilled by the time the year is over.
The industrial unions of the CIO are eee*?«aking their contributions
separately, but all are setting the same splendid example*
The
United Automobile Worker* alone pledged themselves to buy
$50 million worth of War Bonds during the year*
They have raised
this sum in six months and are now out to pyramid their original
pledge to $100 million within the year*
The Automobile Workers
have a nationwide drive now going on to sign their members up to
Invest 20$ of their wages in War Bonds
the battleships —
that our fighting men need*
haa
I-te@S^sthat
► bought War ponds
liberally*
I am proud of Bee Hampshire's record of War Bond
the fourteen months from May 1, 194*1
purchases*
V
to the end of July, we here in Hew Hampshire ¿ought $27,837*500
worth of bonds*
Hiring July, this state led all the Hew ®agland states
in the per cent sold of the monthly state bond quotas*
sold
Mew Hampshire
99*3% of its quota*
Furthermore, 100$ of the Hew Hampshire fines with more than
500 employees had a payroll sawings plan in operation*
The only
other Sew England state to equal this record is Vermont*
But fine as this rscord
it the very least* each
of us should invest 10$ of our income in War Bonds regularly
a dime out of every dollar, a dollar out of every ten*
n
up
Actually, out psrll 1« so $reai that not one of us can
or take it easy without endangering m t chances of victory«
Each
must learn to think of this war as a personal
of us
struggle against the lasts and the Jape«
Sou may not be a munitions worker«
Son
m j not be a soldier«
But you have still got a war job,
because total war gives every one of us a war job«
The significance of this fact is plain as day«
Ovar and above
the performance of our everyday job, each of us must contribute
something extra to sea*<osiwae* war effort#
67.
B'e are^ln this fight —
ll *>o
personally responsible for seeing it through«
The home front oust not f a n behind the pace set by the fighting
front and the production front*
We all realise that there is one simple, direct way for every
/
man, woman and child in this country to help win the/war#
Our Army
and our ffavy are calling not only for men, but for dollars to
enlist —
fighting dollars*
the weapons of victory —
We know that *ar *bnds help to pay for
the planes and the tanks, the bombs and
^ *
Every one
-
\
laofe of ua here tonight should get one fact clearly in mind*
this la our war*
winit
Mobody ia going to win it for ua#
%
have got to
ourselves, against a hard, merciless enemy#
Moreover, it ia a new kind of war.
the fighting front
JL—'
atretchea
io our own front yarda in Manchester#
In costing
(tonight,) we
hear the
rumble of an invader’s guns along our coast#
in Manchester streets#
We
saw no shell holes
And because w e could not hear the sound
of battle, or see war ruins in front of our eyes, our danger may
seem
But that ia an illusion#
You have only to read your newap^ers
and listen to your radio, to realise that we have not yet begun to
win this war and w e still run a tremendous risk of losing it*
More
and more, we are beginning to realise that we must heat cur
enemies on the fighting fronts in
the far
c o m e r s of the earth.
or we shall find w e have to beat them here in our own front yards
Within the past month, our marines have landed in the ¿olomon
Islands and have begun the Job of rolling back the military power of
Japan*
The Bangers picked
from our
troops in England have fought
beside their Canadian and British comrades in the great commando
raid on Dieppe, France*
Oar airplanes
the British check Rommel in Egypt.
and our tanks are helping
Our Jfevy is fighting Nasi submarines
on the Atlantic convoy lanes*
But the extra effort of brain and muscle made today by our fighting
men and our war workers — * and that includes oun/own New Hampshire
boys in the armed services and our shipyard workers who stayed on the
job down at Portsmouth, as well as men and women in other war
industries all over the state —
this extra effort put forth on labor
Gay is more than just an Inspiration to us here on the home front*
-hex S'
It is a"challenge*
A
Suppose each of us here tonight stopped and asked himself or
herself, "^hat have I done to help the war effort today?*
What
£~ c- (> /,-u^ ,j3W
KAHCHRSTER, «
HAMPSHIRE
U B O R DAT, SEPTEMBER 7, 1942
It is a pleasure and a privilege to be here^ n ^ t / i n m y own
s ta te of ifeir ftanttirihijmft. &rv3 in 4ft4» wni 4w
4*im t«v>
m
iv«r
But war takes no holidays*
On our first Labor Bay in this war, there are half a million
Americans at battle stations on our fronts clear around the world*
Here in this country millions more are in training*
And millions
of American war workers have given up their holiday and stayed
right on the job making the weapons of victory.
I think it is a sign of the changing times that to vast numbers
of Americans Labor Day this year has not been a holiday so much as
*
(Ks
an inspiration to^nsw and greater effort for victory*
Here is # proof that our war effort is rolling into high gear*
And it is inspiring to realise that today more and more American
troops are going into action on all the fighting fronts*
A\
TREASURY DEPARTI»
Washington
Ioilowing aUS•ress by Assistant S
Treasury John D. Sullivan before sta
igr I jlx^ vh 80n
4*a c c husi q ^
scheduled Dor del
Ane
i
TH SA SURY DEPARTMENT
Washington
(The following address by Assistant Secretary of the
Treasury John 1. Sullivan before the Labor Lay rally
in Manchester, New Hampshire, is scheduled for
delivery at 3 P«ni,, Eastern War Time, Monday, September
7, 1942, and is for release at that time, )
It is a pleasure and a privilege to be here today' in
my own state of New Hampshire, and to join you in celebrat
ing Labor Lay*
Labor Lay is-traditionally one of our great
American holiday©.
But war takes no holidays.
;On our first Labor Lay in this war, there are half a
million Americans at battle stations on our fronts clear
around the world. Here in this country millions more are in
training. And millions of American war workers have given
up their holiday and stayed right on the job making the wea
pons of victory.
I think I t ' i i a sign of the changing times that to vast
numbers of Americans Labor Lay this year has not been a hol
iday so much as an inspiration to a new and greater effort
for victory.
Here is proof that our war effort is roiling into high
gear. And it is inspiring to realise that today more and
more American troops are going into action on all the fight
ing fronts.
j
■
. -'
Within the past month, our marines have landed in the
Solomon Islands and have begun the job of rolling back the
military power or Japan. Tne Hangers picked from our troops
in England have fought beside their Canadian and British
comrades in the great commando raid on Dieppe, Prance, Our
airplanes and our tanks are helping the British check Rommel
m .agypt. Our Navy is fighting Nazi submarines on the
Atlantic convoy lanes.
But^the extra effort of brain and muscle made today by
oar fighuipg men and. our war workers —— and that includes our
33-11
2
own New Hampshire boys in the armed services and our shipyard
workers who stayed on the job down at Portsmouth, as well as
men and women in other war industries all over the state -this extra effort put forth on Labor Lay is more than just an
inspiration to us here on the home front. It is a personal
challenge.
Suppose each of us here today stopped and asked himself
or herself, "What have I done to help the war effort today?"
What answer would we make?
Every one of us here this afternoon should get one fact
clearly in Blind. This is our war. Hobody is going to win it
for us. We have got to win it ourselves, against a hard,
merciless enemy.
Moreover, it is a new kind of war, and the fighting
front stretches into our own front yards here in Manchester.
In coming here today, we didn’t hear the rumble of an
invader’s guns along our coast. We saw no shell holes in
Manchester streets. And because we could not hear the sound
of battle, or see war ruins in front of our eyes, our danger
may seem remote.
But that is an illusion. You have only to read your
newspapers and listen to your radio, to realize that we have
not yet begun to win this war and we still run a tremendous
risk of losing it. More and more, we are beginning to realiz
that we must beat our enemies on the fighting fronts in the
far corners of the earth, or we shall find we have to beat
them here in our own front yards.
Actually, our peril is so great that not one of us can
let up or take it easy without endangering our chances of vie
tory. Each of us must learn to think of this war as a per
sonal Struggle against the 1-lazis and the Japs. You may not
be a soldier. You may not be a munitions worker. But you
have still got a war job, because total war gives every one
of us a war job.
The significance of this fact is plain as day. Over and
above the performance of our everyday job, each of us must
contribute something extra to the war effort. We are all in
this fight -- and all of us are personally responsible for
seeing it through. The home front must not fall behind the
pace set by the fighting front and the production front.
We all realize that there is one simple, direct way for
every man, woman and child in this country to help win the
~ 3 war.
O u r A r m y a n d o u r N a v y a r e c a l l i n g n o t o n l y f o r men, b u t
f o r d o l l a r s to e n l i s t — f i g h t i n g d o l l a r s .
We k n o w that W a r
B o n d s h e l p to p a y f o r t h e w e a p o n s of v i c t o r y —
t he p l a n e s
a n d t h e t a nks, t he b o m b s a n d the b a t t l e s h i p s —
that our
f i g h t i n g m en need.
I am sure that everyone here todayLhas
bought W a r Bonds liberally.
I a m p r o u d o f N e w H a m p s h i r e fs r e c o r d o f W a r B o n d p u r
chases.
I n t h e f o u r t e e n m o n t h s f r o m M a y 1, 19^-1, to t h e end
of July,- w e h e r e in N e w H a m p s h i r e b o u g h t $ 2 7 , 6 3 7 * 5 0 0 w o r t h of
bonds.
D u r i n g July, t h i s s t a t e l e d a l l t h e N e w E n g l a n d
s t a t e s in t h e p e r c e n t s o l d of t h e m o n t h l y s t a t e b o n d q u o t a s .
N e w H a m p s h i r e s o l d 9 9 * 3 $ cf its q u o t a .
Furthermore, 1 0 0 $ of the N e w H a m p s h i r e firms w i t h more
t h a n 500 e m p l o y e e s h a d a p a y r o l l s a v i n g s p l a n in o p e r a t i o n .
T h e o n l y e t h e r N e w E n g l a n d s t a t e t o e q u a l t h i s r e c o r d is
Vermont.
B u t f i n e as t h i s r e c o r d is, w e k n o w it i s n !t g o o d e n o u g h .
At t h e v e r y l e a s t , e a c h o f u s s h o u l d i n v e s t 1 0 $ of c u r i n c o m e
in W a r B o n d s r e g u l a r l y —
a d i m e out of e v e r y d o l l a r , a d o l
l a r out of e v e r y ten.
O u r c o u n t r y is d e m a n d i n g o f c u r s o l d i e r s a n d s a i l o r s , not
10$, b u t 1 0 0 $ o f e v e r y t h i n g t h e y ' v e got —
including their
very lives.
O u r c o u n t r y is e x p e c t i n g o u r w a r w o r k e r s to d e
li v e r 1 0 0 $ of their skill a n d their effort —
a n d to b u y b o n d s
besides.
A n d o u r w a r w o r k e r s a r e d o i n g J ust t h a t .
The A m e r
i c a n F e d e r a t i o n of L a b o r h a s p l e d g e d that its m e m b e r s w i l l
b u y a b i l l i o n d o l l a r s w o r t h of bonds d u r i n g this year.
This
p l e d g e is a l r e a d y c o n s i d e r a b l y a h e a d of q u o t a a n d P r e s i d e n t
G-reen s a y s it w i l l b e m u c h m o r e t h a n f u l f i l l e d b y t h e t i m e
the y e a r is over.
T h e i n d u s t r i a l u n i o n s of t h e C I O a r e m a k i n g t h e i r c o n t r i
b u t i o n s separately, but all are se t t i n g the same s p l e n d i d e x
ample.
The United Automobile Workers alone pledged themselves
to b u y $50 m i l l i o n w o r t h of W a r B o n d s d u r i n g t h e y e a r .
They
h a v e r a i s e d t h i s s u m in s i x m o n t h s a n d a r e n o w out t o p y r a m i d
t h e i r o r i g i n a l p l e d g e to $ 1 0 0 m i l l i o n w i t h i n the ye a r .
The
A u t o m o b i l e W o r k e r s h a v e a n a t i o n w i d e d r i v e n o w g o i n g o n to
s i g n t h e i r m e m b e r s u p to i n v e s t 2 0 $ of t h e i r w a g e s in W a r B o n d s .
T h e R a i l r o a d B r o t h e r h o o d s , l i k e the o t h e r g r e a t l a b o r
o r g a n i z a t i o n s , a r e d o i n g a t r e m e n d o u s Job i n e n c o u r a g i n g t h e i r
m e m b e r s to s i g n u p o n p a y r o l l s a v i n g s p l a n s .
I n t h i s c o n n e c t i o n , I s h o u l d l i k e to m a k e s p e c i a l m e n t i o n
of t h e r e c o r d m a d e b y t h e e m p l o y e e s of t he B o s t o n a n d M a i n e
<*
fc -
~
R a i l r o a d , w h o a r e s e t t i n g an e x a m p l e to e v e r y r a i l r o a d m a n in
t h e c o u n t r y a n d d o i n g a job no o t h e r r a i l r o a d h a s s u r p a s s e d .
A n d w h a t a b o u t u s h e r e o n the h o m e f r o n t ?
Can we t r u t h
f u l l y s a y t h a t w e are n o w p u t t i n g 1 0 0 $ o f o u r e f f o r t i nto
b a c k i n g u p the f i g h t i n g l i n e s a n d t h e p r o d u c t i o n l i n e s ?
O u r c o u n t r y spent n e a r l y
B u t o u r p u r c h a s e s of W a r B o n d s
quota.
$5
b i l l i o n o n t h e w a r in A u g u s t ,
f e l l f a r s h o r t of the n a t i o n a l
Is that o u r b e s t e f f o r t o n t he h o m e f r o n t ?
I s t h a t the
k i n d of n e w s o u r N e w H a m p s h i r e b o y s in E g y p t a n d in I c e l a n d
a n d in A u s t r a l i a o u g h t to h e a r f r o m h o m e ?
I s a y to y o u w i t h a d e e p s e n s e of c o n v i c t i o n , w i t h all
t h e e a r n e s t n e s s in m y po w e r , t h a t v e r y f e w of u s h a v e yet
b e g u n to m a k e t h e s a c r i f i c e s n e c e s s a r y to w i n t h i s w a r .
W e a r e b u y i n g b o n d s h e r e in N e w H a m p s h i r e —
yes.
Our
f i n e r e c o r d p r o v e s t hat.
But we h a v e not put b o n d s first
on o u r b u d g e t s .
W e are still b u y i n g bonds w i t h o u r surplus
income.
W e h a v e n ot cut d e e p l y e n o u g h i n t o o u r l i v i n g e x
penses.
W e h a v e not yet s u b s t i t u t e d b o n d s f o r t h e p u r c h a s e s
we s h o u l d do w i t h o u t .
N o b o d y n e e d s to s h o w N e w E n g l a n d e r s h o w to s c r i m p a n d
•save.
N e w England thrift came from New Hampshire.
It w a s
N e w H a m p s h i r e p i o n e e r s g o i n g o u t to s e t t l e t h e west, w h o
h e l p e d c r e a t e t h e h o m e s p u n p i o n e e r slogan, "Eat it u p —
w e a r it out —
m a k e it do."
T h a t is t h e s p i r i t w e n e e d a g a i n on t h e h o m e f r o n t .
That
is t h e s p i r i t in w h i c h we m u s t b u y b o n d s —
b o n d s i n s t e a d of
l u x u r i e s , b o n d s I n s t e a d o f p l e a s u r e s , b o n d s i n s t e a d of all
t h e e a s y a n d c o m f o r t a b l e t h i n g s w e c a n do w i t h o u t .
O n l y l a s t w eek, in a n a d d r e s s to an i n t e r n a t i o n a l s t u
dent a s s e m b l y in Washington, Presi d e n t R oosevelt once more
w a r n e d u s t h a t t h i s w a r is " g o i n g to be l o n g a n d h a r d a n d
bitter."
W e c a n n o t w i n t h i s k i n d of w a r w i t h " l i v i n g as u s u a l "
a n y m o r e t h a n w i t h " b u s i n e s s as u s u a l " .
F o r e a c h of us, t h a t
means real sacrifice, h ard sacrifice —
sacrifice that hurts.
W e h a d to g i v e u p " b u s i n e s s as u s u a l " , a n d h e r e on t h e h o m e
f r o n t w e w i l l h a v e to g i v e u p " l i v i n g as u s u a l " .
A n d t he
q u i c k e r w e g i v e it up, t h e e a s i e r t h e t r a n s i t i o n w i l l be, a n d
the f a s t e r w e w i l l g e t on w i t h t h e job of w i n n i n g t h e war.
~ 5 -
has
L et us not f o r g e t f o r
at s t a k e in t h i s war.
a moment
what
e a c h o f us p e r s o n a l l y
I n h i s s p e e c h to t h e s t u d e n t s , w h i c h w a s s h o r t w a v e d to
o u r f i g h t i n g f o r c e s a l l o v e r t h e world, the P r e s i d e n t p r o m
i s e d t h a t " t h i s t i m e w e s h a l l k n o w h o w to m a k e f u l l u s e of
v i c t o r y " to b u i l d a b e t t e r w o r l d .
He s t a t e d t he t r u t h f o r a l l of u s w h e n h e d e c l a r e d t h a t
"the N a z i s , t h e F a s c i s t s a n d the m i l i t a r i s t s of J a p a n h a v e
n o t h i n g to o f f e r to y o u t h —
except death."
A n d t he P r e s i d e n t
d e s c r i b e d t h e c a u s e of t h e U n i t e d N a t i o n s as "the c a u s e of
youth itself"*
D o e s n ’t t h a t p u t it in a n u t - s h e l l ?
I s n ’t y o u t h a n d l i f e
a n d the c h a n c e to m a k e a b e t t e r w o r l d t h e s t a k e t h a t e a c h of
u s h a s in w i n n i n g t h i s w a r ?
I s n ’t t h a t w h y w e a r e a s k e d to
mak e s a c r i f i c e s her e on the h o m e front?
S u r e l y t h a t is w h y
o u r y o u n g m e n h a v e g o n e out to f i g h t on the b a t t l e f i e l d s of
the world.
I
w h e n he
d o w n ,"
k n o w t h e P r e s i d e n t s p o k e f o r all o f u s h e r e t o d a y
p r o m i s e d 6iir f i g h t i n g men, "We w i l l n ot l e t y o u
- 0O 0-
tkeasuet departh^ t
Washington
FOE H E L M S , MORNING KEWSPAPEBS
Saturday , September 5. 1942«
W 4 2
Press Service
33 -/ 5-
the Secretary of the Treasury announced last evening that the tenders
for #350,000,000, or thereabouts of 91-day Treasury bills to be dated September 9
and to mature December 9, 1942, which were offered on September 2, were opened
at the Federal Reserve Banks on September 4*
The details of this issue are as follows:
Total applied for - $709,628,000
Total accepted
- 351,266,000
Bangs of accepted bids:
Except for one tender of $50,000
High ~ 99*925 Equivalent rate approximately 0.297 percent
Low
- 99*905
*
•
«
0.376
«
Average
Price - 99.907
*
*
«
0.368
■
(12 percent of the amount bid for at the low price was accepted.)
TREASURY DÈPARTMENT
Washington
FOR RELEASE, MORNING NEWSPAPERS,
Saturday, September 5) 1942..
9/4/42
1 1
Press Service
No. 33-12
Th® Secretary of the Treasury announced last evening that
the tenders for $350,000,000, or thereabouts of 91-day Treasury
bills to be dated September 9 and to mature December 9, 1942,
which were offered on September 2, were opened at the Federal
Reserve Banks on September 4.
The details of this issue are as follows:
Total applied for - $709,828,000
Total accepted
- 351,288,000
Range of accepted bids:
)
Except for one tender of $50,000
High - 99 .925 Equivalent rate app roximate1y 0 .297
tf
it
Low
- 99 .905
"
0 .376
Average
it
n
Price _ gg .907
"
0 .368
(12 percent of the amount bid for at the low price was
-oOo-
TREASURY DEPARTMENT
Washington
FOR IMMEDIATE RELEASE,
Saturday, September 5, 1942.
Press Service
33-13
Secretary Morgenthau today made the following statement:
In the coming week the Treasury is going to have to borrow
another $3,000,000,000 to help pay for the war. This is to be
done by public offering of interest-bearing bonds for subscrip
tion through the Federal Reserve Banks. I have no doubt that
institutional investors, commercial banks and other large pur
chasers will respond in the fine way in which they'have.-re—
sponded to all offerings of Government securities since the
war began.
Yet too much reliance on this conventional kind of borrow
ing has its dangers, and I feel that the American people should
become more aware of its dangers. Specifically, we cannot hope
to finance this war in an orderly manner and without a further
serious rise in the cost of living unless our regular borrowing
is supplemented by bold and resolute action in many directions,
among them in the fields of taxes and savings.
My problem is not simply one of getting more money. It is
a problem of enlisting the taxes and the savings of all the
American people themselves. It is a problem of attacking un
necessary spending, which is now reaching boom proportions and
which is threatening to drive the cost of living to heights
which will affect every American home.
We have been at war for almost a.year, yet we as a people
are still spending for things we want and can get at a rate far
higher than a war economy can afford. This cannot^go on. Our
war on the home front cannot be won unless this evil of un
necessary spending is checked and brought under control. -W$
must realize that we are fighting a war for our very survival
as a. nation and that we cannot expect comforts as usual or
'spending as usual.
In every community in the land young men are going out to
battle fronts all over the world to fight for us. It seems a
small thing to do for them that we should give up temporarily
some of the comforts we possess, the comforts that they are
denied.
- 2 -
The spending that is going on today is a national danger
and its continuance will have disastrous results^for every
American. We must attack unnecessary spending with stern
remedies, through the fiscal field as well as through other
devices, and there is no more time for delay.
With the double purpose of bringing billions of dollars
into the Treasury and of discouraging unnecessary^spending,
the Treasury submitted to the Senate Finance Committee last
Thursday a new form of tax to be known as the spendings tax.
It is aimed at everything above what'we need and what we save.
It is a tax in two parts -- the first a flat levy of ten per
cent on spendings of everyone above a bare subsistence income,
and the second a graduated tax on higher spendings which be
comes frankly.a penalty tax on those who spend thousands of
dollars unnecessarily in these times when spending actually
impedes the wrar effort. The first part, the flat 10 percent,
will be regarded as a debt to the taxpayer and will be repaid
in full after the war.
From the first part, the refundable ten percent , some
$4,500,000,000 will flow into the Treasury; from the second,
about $1,200,000,000, in revenue would be yielded ea ch year,
But this does not tell the whole story, for there is no way
of estimating the amount of saving which will be enc ouraged
by such a tax. It is the first tax measure I have s een which
actually gives an incentive to thrift, to the purcha se of War
Bonds and the repayment of debt, to the payment of 1 ife insurance premiums and many other forms of true saving s. All
The more you save, the
such expenditures will be deductible
smaller the tax you have to pay.
This is the principle of the spendings tax. To me it is
de school arithmetic. Yet I hear it described
Liriole as grade
i
t
Il compii cat ed,T simply because there re many technical deL.-,er,
on the taxpa;
__
x
u
y
;ails in its structure. In its actúa impact
T
n
t
n
n
A
T
T
A
I
O
A
T
"
\
it will be severe, because severe measures are needed, but it
will require no elaborate bookkeeping or computation.^ For the
great majority of our taxpayers it will mean the filling out
of one very simple form to be attached to the regular income
tax form -- and this, I may point out, has already been vastly
amplified for them.
o
o
Every new tax seems ’’complicated1’ when it first appears.
The income tax which we now take for granted, was regarded
as complicated, unworkable and unsound when it was introduced
a quarter of a century ago. Surely those who complain that
the tax is ’’complicated” mean rather that it is new and^un
familiar. Its principle is simple, its logic is unassailable,
and its operations can be handled through the normal income
tax machinery.
The problem of financing the war without inflation is
too grave and too pressing to let any major tax proposal be
disregarded without the most serious thought and study.
Accordingly, I regard it as a slur upon the Senate Finance
Committee to suggest that the Committee is about to reject
the spendings tax after only perfunctory consideration.^
Such a suggestion is not true. The Senate Finance Committee
is as much aware of the gravity of this hour a s we at the
Treasury or anyone in a position of authority, and its mem
bers realize as I do, the need for additional fiscal measures
to prevent unbearable increases in the cost of living.^
Senator George, the distinguished Chairman of the Committee,
has discussed it in detail with me, and I know that he and
his fellow members will consider it with ail the earnestness
and seriousness which a proposal of this magnitude deserves.
Moreover, I have been concerned at the disposition in
some quarters to couple this spendings tax with a sales
tax -- as if a sales tax were any answer to our problem.
A retail sales tax of five percent on all goods not now sub
ject to heavy Federal excise taxes would, according to our
estimates, raise only $1,635,000,000 even if it included
sales of food, medicines, clothing and' fuel. ^More than that,
it would fail to tax many kinds of services, it would be
grossly unfair in falling upon those with only $5 or $10 a
week of earnings, it would play havoc with price ceilings,
and it would have an utterly inadequate effect in discourag.ng consumer spending.
The spendings tax, on the other hand, will bring four
times as much money into the Treasury in a Angle year. Tf
will tax all spendings, whether goods or services, above
necessities and above savings. It will not affect price
ItiliifJII in any way. It will, I am convinced, exert such a
restraining effect upon unnecessary spending that it will make
thrift not'only wise^'but fashionable.’ I know of no more effec
tive way of insuring that the people tighten their belts in war
time and put their savings away until the war is over.
For these reasons it is my firm belief that, no matter what
purely revenue devices Congress may adopt, we shall still face
the necessity of enacting real and basic controls of spending
along the lines I have suggested.
- 5 -
imposing a heavy “burden on persons with low standards of living*
In short, the standings surtax is selective in its impact, bringing
pressure to hear whore pressure Is needed.
These proposals of the Treasury will rea.ch over two-thirds of
totai consumer spending; A spendings tax will reach over $50
billion out of total consumer spendings in the neighborhood of $75
billion, A retail sales tax with as broad a, scope as feasible,
will reach somewhat less than this amount. A retail sales tax with
food exempt will reach only a little over $30 billion.
The two principal measures that have generally been advanced
for tapping mass purchasing power are the general Sales Tax and
the individual Income Tax. The Sales Tax ha.s the merit tha.t it
hits directly at consumer spending. Its defects are that it dis
tributes the burden in an inequitable manner, and is incapable of
imposing sufficient pressure on luxury spending. The individual
income tax has the virtue that it can exempt the lowest incomes,
and can be made progressive. Under prerent conditions, it is dif
ficult to increase it eg. much as we need, because it makes no al
lowance for fixed commitments to repay debts, to pay insurance
premiums, and to make regular savings— forms of expenditures
tha.t exert no inflationary pressure.
The spendings tax has the merits of bd'th the Seles Tax and. of
further increases in the individual income tax, while having the
defects of neither. It hits directly at spending, permitting debt
repayment, insurance premiums, and. the like to be deducted.. At
the seme time it is progressive, end. ple.ces f' severe penalty on
luxury spending.
Our problem
deal effectively
not be ignored,
of these factors
has many facets. We must raise revenue. We must
with inflation. Questions of simple equity must
ITo solution which fails to take into account all
will d.o the job that must be done.
This is going for down the income scale, farther then any of
us would like to go in ordinary tines. But these are not ordinary
times. We can now afford to exempt only persons a.t the very lowest
living levels.
Because we T>ror)Ose going farther down the income tax scale
than would he tolerable in ordinary times, we think that the 10
toorcent that people are to contribute, should not be a permanent
contribution, but should be returned to them after the war when we
can once again use all our resources for the production of consumer
goods and services.
This 10 percent contribution will be paid by over 30 million
persons, and will withdraw approximately $4.5 billion in purchasing
power. Because it is levied on spending, and not on income, it
will give individuals an incentive to save. Any amounts they save
will be subtracted from their income in computing the amount they
must contribute. Thus there is automatic adjustment for those who
must use part of their incomes for the re-payment of debt, or for
other fixed commitments.
The incentive to save, however, will be small in the upper
reaches of the income scale. Individuals at these levels have
ample margins with which to meet a. 10 percent addition to the cost
of goods and services, particularly when this addition is to be re
turnable to them after the war. Consequently, the Treasury pro
poses, as an integral part of its program, a steeply graduated tax
on luxury spending. This tax would not be returnable after the war,
since it would be paid only by persons with relatively liberal
standards of living.
This graduated spendings tax would apply to a. married couple
without children, only if they spent more than $3,000 on consumer
goods and services. The first $2,000 such a married couple spent
would be free from tax. It would constitute a. basic expenditure
ration. The married couple could, of course, spend any amount
above this that they wished, but they would have to pay an increas
ingly severe price for doing so. Bor the first $2,000 they spent
above their basic ration they would have to pay 10 "percent; for the
next $2,000 they would have to pay 20 percent. The additional
■price they would have to pay for each dollar of expenditure would
increase, until any married couple that spent more than $20,000
above its expenditure ration, would have to turn over to the Treasury
75 cents for every additional dollar they spent.
The graduated spendings surtax provides the element of flexi
bility that a sales tax so sadly lacks. It makes it possible to
apply differential pressure to persons at different places in the
income scale. By use of the spendings surtax it is possible to
discourage high level luxury spending without at the same time
on individuals vrith the lowest standards of living, since such in
dividuals are forced to spend all of their income on the "basic ne
cessities of life. The sales tax falls least heavily on persons
whose incomes leave them a. substantial margin for savings or for
luxury spending. ITo one would propose that we enact an income tax
without exemptions at a. rate of 10 percent on a $500 income, at a
ra.te of 6 percent on a $2,500 income, and at a rate of 3 percent
on a $10,000 income. Yet such a proposal would distribute the "bur
den in the same way as a, fla.t 10 percent retail sales tax. The
only difference is in name, not in substance.
A sales tax is too crude an instrument to perform the function
of inflation control. It cannot discriminate "between persons who
can, and who cannot, reduce their purchases substantially. It hits
all alike. In consequence, it is impossible to impose a sales tax
a.t sufficiently high rates to curtail the consumption of persons
whose living standards are liberal, without at the same time levy
ing an intolerable burden on tens of millions of our citizens. If
imposed at low rates, the sales tax will exercise little or no re
straining influence on the persons who are in the best position to
reduce their standards of living.
The results we desire can be accomplished in a. far more
straightforwa.rd manner by means of a spendings tax.
That tax is designed to serve two complementary functions,
Pirst, to withdraw money from the purchasing stream, and thus to
deal directly with the inflation problem; and, second, to distrib
ute the war burden whore it can best be borne.
The spendings tax withdraws money from the purchasing stream
in two ways. In the first plane, it requires that all individuals,
except those with the very lowest incomes, turn over to the Tree.sur
a percentage of the amount they spend. The money so turned over is
obviously no longer available to compete for the purchase of goods.
But the spendings tax does more than that. It also gives an in
centive to save rather than to spend. And the money which is saved
though not taken as tax revenue, is nevertheless removed from the
spending stream.
As a, major instrument for withdrawing purchasing power directl
the Treasury proposes that all individuals with incomes above sub
sistence levels be required to turn over to the Treasury 10 percent
of the amount they spend. We propose tha,t a married couple vrith no
children be exempt from this contribution only if their income is
less than $1,000 a year; that a married couple vrith two children be
exempt only if their income is less than $1,500 a year; - and, that
a single person be exempt only if his income is less than $500 a
-
2
-
The simple, but startling, fact is that taxes are not them
selves the cost of war. The cost is there inevitably. Taxes have
a very different function. Their function is to distribute that
cost among the members of the community, in a.s fair a manner as
possible, while maintaining our economic system in a vigorous •po
sition during the war years, and for the post-war period.
The insistent question remainsi How should we raise the tax
revenues we must have? On examination, this question turns out
to be, not a matter of how, but of where. On whom should the bur
den be imposed?
One answer to this basic cuestion is given by many who argue
that it is desira.ble that every individual in the community, re
gardless of his income, be required to pay part of the additional
taxes. The Treasury has taken a different vievr, and has endeav
ored to formulate a tax policy which recognizes that there are
large groups in the community whose standards of living are so
low, that they should not be called upon to pay any more than the
substantial amount of taxes they are now required to pay.
Admittedly, there is no such thing as an absolute minimum
standard of living. Standards of living that we have no hesitancy
in reducing today seemed very low in better times, when we could
use all our resources for the production of consumer goods. But
it is one thing to say that we must adjust our notions of the min
imum standard of living to the changed situation; it is a very
different thing to say that we must discard completely the idea
that there is a group in our community with standards of living so
low that we cannot afford to reduce them still further.
The question is more than one of mere fairness or equity, We
shall lose more than we gain, if we so reduce the standard of liv
ing of our citizens as to impair their morale and their productive
efficiency.
Our people are ready to pay the price tha.t the war imposes.
They are ready to bear its heavy burdens. But they do, demand,
and quite properly, that these burdens be distributed fairly; that
we count not heads, but the ability of individuals to share in the
cost •
A general retail sales tax is vigorously advanced in many
quarters. What is the effect of a sales tax upon inflation? How
would such a tax operate to distribute the economic burden of war?
The sales tax does not give an adequate answer to either of these
questions.
That the sales tax distributes the cost of the war in an in
equitable manner needs little comment. The sales tax falls heaviest
Washington
(The following address by Randolph E. Paul, General Counsel
of the Treasury, before the Victory Conference Luncheon of
the Research Institute of America, in the Wedgewood Room
of the Waldorf-Astoria Hotel, Kev York (¡Jity, is scheduled
for delivery at
Eastern War Time. Monday. September
,Y,_. 194S, and is for release at that time.')
One of the problems of conducting a war is to finance it. I
should be the last one to call it a minor problem, but I think that
we should recognize that it is a secondary problem. Our first task,
o course, is to raise and equip and train an sVihy and navy which
can do the job that has to be done. But this cannot be done by
wishing it. It has to be organized and ulamed and paid for. Our
armed men cannot function unless we provide and maintain the productive machinery at home. And to keen all of this machinery moving
at high speed takes money in unprecedented amounts.
It^is not merely a matter of raising the money. It is really
a question of how it is raised. In deciding how the money should
be obtained,<there are two major questions which must be kept in
mind; What is the effect of any proposed method of raising money
upon the problem of inflation? And how does the method proposed
distribute the economic burden of the war?
A basic economic fact today is that something more than half
of our resources will soon be devoted to the production of instru
ments of war. One out of every two wage earners will be receiving
income for contributing to the production of goods that he cannot
purchase. Unless we utilize to the utmost all possible controls,
tx.e excess of purchasing power over the volume of consumer goods
produced must lead to a rise in prices. And such a rise would add
immeasurably to the costs, and to the hardships of war.
One of the wavs to combat inflation is to reduce the amount
that consumers try to spend. Inflation, itself, does not reduce
e quantity of goods available for people to buy; but it does
Cxange the distribution of those goods in a very unfair manner, de
priving those of small incomes of goods which they should have,
thus leaving more of an already scanty supply for people who can
afford to pay the increased prices. What we must devise is a means
w ich will not only reduce the demand for goods, but also distrib
ute that reduction in an equitable manner.
33-14
TREASURY Ü / É W
Washington
(The following address by Randolph E. Paul, General Counsel
of the Treasury, "before the Victory Conference Luncheon of
the Research Institute of America, in the Wedgewood Room
of the Waldorf-Astoria Hotel, Few York City, is scheduled
for delivery at 2 p.m., Eastern War Time, Monday. September
If.. 194?, and is for release at that time,)
One of the problems of conducting a war is to finance it. I
should he the last one to call it a minor problem, hut I think that
we should recognize that it is a secondary problem. Our first task,
of course, is to raise and equip and train an army and navy which
can do the ¡job that has to be done. But this cannot be done by
wishing it. It has to be organized and planned and -paid for. Our
armed men cannot function unless we -provide and maintain the pro
ductive machinery at home. And to kee-p all of this machinery moving
at high speed takes money in unprecedented amounts.
It is not merely a matter of raising the money. It is really
a question of how it is raised. In deciding how the money should"
be obtained, there are two major questions which must be kept in
mind: What is the effect of any proposed method of raising money
upon the problem of inflation? And how does the method proposed
distribute the economic burden of the war?
A basic economic fact today is that something more than half
of our resources will soon be devoted to the production of instru
ments of war. One out of every two wa.ge earners will be receiving
income for contributing: to the production of goods that he cannot
purcha.se. Unless we utilize to the utmost all possible controls,
the excess of purchasing power over the volume of consumer goods
produced must lead to a rise in prices. And such a. rise would add
immeasurably to the costs, and to the hardships of war.
One of the ways to comba.t inflation is to reduce the amount
that consumers try to spend. Inflation, itself, does not reduce
the quantity of goods available for people to buy; but it does
cha.nme the distribution of those goods in a. very unfa.ir manner, de
priving those of small incomes of goods which they should have,
thus leaving more of an already scanty supply for people who can.
afford to pay the increased prices. What we must devise is a means
which will not only reduce the demand for goods, but also distrib
ute that reduction in an equitable manner.
-
2
-
The simple, hut startling, fact is that taxes are not them
selves the cost of war. The cost is there inevitably. Taxes have
a very different function. Their function is to distribute that
cost among the members of the community, in as fair a manner as
possible, while maintaining our economic system in a vigorous po
sition during the war years, and for the post-war period.
The insistent question remains; How should we raise the ta.x
revenue s ’we must have? On examination, this ciuestion turns out
to be, not a matter of how, but of where. On whom should the bur
den be imposed?
One answer to this basic ciuestion is given by many who a.rgue
that it is desirable that every individual in the community, re
gardless of his income, be reauired to pay part of the additional
taxes. The Treasury ha.s ta.ken a different view, and ha.s endeav
ored to formulate a tax policy which recognises that there are
large groups in the community whose standards of living are so
low, that they should not be c a l l e d upon to pay any more than the
substantial amount of taxes they are now required to pay.
Admittedly, there is no such thing as an absolute minimum
standard of living. Standards of living that we have no hesitancy
in reducing today s e a m e d very low in better times, when w e could
use all our resources for the production of consumer goods. But
it is one thing to say that w e must adjust our notions of the min
imum standard of living to the changed situation; it is a. very
different thing to say that we must discard completely the idea
that there is a group in our community with standards of living so
low that we cannot afford to reduce them still further.
The question is more than one of mere fairness or equity. We
shall lose more than we gain, if
so reduce the standard of liv
ing of our citizens as to impair their morale and their productive
efficiency.
Our people are ready to pay the price that the war imposes.
They are ready to bear its heavy burdens. But they do, demand,
and" quite properly, that these burdens be distributed fairly; that
we count not heads, but the ability of individuals to share in the
cost.
A general retail sales tax is vigorously advanced in many
quarters. What is the effect of a s^les tax upon inflation? How
would such a tax operate to distribute the economic burden of war?
The sales tax does not give an adequate answer to either of these
questions.
Thai the sales tax distributes the cost of the war in an in
equitable manner needs little comment. The sales tax falls heaviest
on individuals vrith the lowest standards of living, since such in
dividuals are forced to spend all of their income on the "basic ne
cessities of life. The sales tax falls least heavily on persons
whose incomas leave them a. substantial margin for savings or for
luxury spending. Uo one would propose that we enact an income tax
without exemptions at a rate of 10 percent on a $500 income, at a
rate of 6 percent on a $2,500 income, and at a rate of 3 percent
on a $10,000 income. Yet such a proposal would distribute the bur
den in the same way as a flab 10 percent retail sales tax. The
only difference is in name, not in substance.
A sales tax is too crude an instrument to perform the function
of inflation control. It cannot discriminate between persons who
can, and who cannot, reduce their purchases sub §tant ially* It hits
all alike. In consequence, it is impossible to impose a sales tax
at sufficiently high rates to curtail the consumption of persons
whose living standards are liberal, without at the same time levy
ing an intolerable burden on tens of millions of our citizens. If
imposed a.t low rates, the sales tax will exercise little or no re
straining influence on the persons who are in the best position to
reduce their standards of living*
The results we desire can be accomplished in a. far more
straightforward manner by means of a spendings tax.
Tha.t tax is designed to serve two complementary functions,
Yirst, to withdraw money from the purchasing stream, and thus to
deal directly with the inflation problem; and, second, to distrib
ute the war burden where it can best be borne.
The spendings tax withdraws money from the purchasing stream
in two ways. In the first place, it requires that all individuals,
except those with the very lowest incomes, turn over to the Treasury
a percentage of the amount they spend. The money so turned over is
obviously no longer available to compete for the purchase of goods.
But the spendings tax does more than that. It also gives an in
centive to save ra/fcher than to spend. And the money which is saved,
though not taken a.s tax revenue, is nevertheless removed from the
spending stream.
As a. major instrument for withdrawing purchasing power directly,
the Treasury proposes that all individuals with incomes above sub
sistence levels be required to turn over to the Treasury 10 percent
of the amount they spend. W e propose that a married c o u p l e vrith no
children be exempt from this contribution only if their income is
less than $1,00'0 a. year; that a. married couple vrith two children be
exempt only if their income is less than $1,500 a. year; - and that
a single person be exempt only if his income is less than $500 a
year*
This is going far down the income scale, fanther than any of
us would like to go in ordinary times. But these are not ordinary
times* Wft can now afford to exempt only nersons at tha vary lowest
living levels*
Because we nronose going farther down tha income tax scale
than would ha tolerable in ordinary tines, we think that the 10
nercent that neo-ole are to contribute, should not be a permanent
contribution, but should be returned to them after the war xlien we
can once again use all our resources for the production of consumer
goods and services.
This 10 nercent contribution will be paid by over 30 million
parsons, and will withdraw approximately $4.5 billion in purchasing
nower* Because it is levied on spending, and not on income, it
will give individuals an. incentive to save. Any amounts they save
will be subtracted from their income in computing the amount they
must contribute. Thus there is automatic adjustment for those who
must use Dart of their incomes for the re-Dayment of debt, or for
other fixed commitments.
The incentive to save, however, will be small in the upner
reaches of the income scale. Individuals a.t these levels have
ample margins with which to meet a 10 percent addition to the cost
of goods and. services, particularly when this addition is to be re
turnable to them after the wan. Consequently', the Treasury pronoses, as an integral na.rt of its program, a steeply graduated tax
on luxurv snending. This tax would, not be returnable a.fter the war,
since it would be naid only by persons with relatively liberal
standards of living.
Tbis graduated, snendlngs tax would, apnly to a. married counle
without children, only if they snent more than $2,000 on consumer
goods and. services. The first $2,000 such a married counle snent
would, be free from tax. It would constitute a basic exoenditure
ration. The married couple could, of course, snend any amount
above this that they wished, but they would have to pay an increas
ingly severe nrice for doing so. Bor the first $2,000 they spent
above their basic ration they would have to pay 10 nercent; for the
next $2,000 they would have to nay 20 nercent. The additional
nrice they would have to nay for each dollar of exoenditure would
increase, until any morried counle that snent more than $20,000
above its expend!ture ration, would, have to turn over to the Trea.sury
75 cents for every additional dollar they snent.
The graduated snendings surtax nrovid.es the 'element of flexi
bility that a, sales tax so sadly lacks. It makes it nossible to
annly differentia! nressure to nersons at different places in the
income scale. By use of the snendlngs surtax it is possible to
discourage high level luxury spending without at the same time
- 5 -
imposing it heavy "burden on persons with low standards of living,
In short the spendings surtax is selective in its impact, bringing
pressure to "bear where pressure is needed.
These proposals of the Treasury will reach over two-thirds of
total consumer spending, A spendings tax will reach over $50
billion out of total consumer spendings in the neighborhood of $75
billion, A retail sales tax with as broad a scope as feasible,
will reach somewhat less than this amount* A retail sales ta,x with
food exempt will reach only a little over $30 billion.
The two principal measures that have generally been advanced
for tapping mass purchasing power are the general Sales Tax and
the individual Income Tax* The Sales Tax has the merit tha.t it
hits directly at consumer spending. Its defects are that it dis
tributes the burden in an inequitable manner, and is incapable of
imposing sufficient pressure on luxury spending. The individual
income tax has the virtue that it can exempt the lowest incomes,
and can be made progressive. Under present conditions, it is dif
ficult to increase it as much as we need, because it makes no al
lowance for fixed commitments to repay debts, to pay insurance
premiums, and to make regular savings — forms of expenditures
tha.t exert no inflationary pressure.
The spendings tax has the merits of both the Sales Tax and. of
further increases in the individual income tax, while having the
defects of neither. It hits directly at spending, permitting debt
repayment, insurance premiums,- P-fet the like to Do deducted. At
the seme time it is progressive, and places a severe penalty on
luxury spending.
Our problem
deal effectively
not be ignored,
of these fa.ctors
has many facets. We must raise revenue. We must
with inflation, Questions of simple equity.must
ITo solution which fails to take into account all
will do the job that must be done.
TREASURY DEPARTMENT
Washington
(The following address by Randolph E. Paul, General Counsel
of the Treasury, before the Victory Conference Luncheon of
the Research Institute of America, in the Wedgewood Room
of the Waldorf-Astoria Hotel, Hew York City, is scheduled
for delivery at 2 p.m., Eastern War Time, Monday, September
7, 1945, and is for release at that time«)
One of the "problems of conducting a war is to finance it. I
should be the last one to call it a minor -problem, but I think that
we should recognize that it is a secondary -problem. Our first task,
of course, is to raise and equi-p and train an a.rmy and navy which
can do the job that has to be done. Rut this cannot be done by
wishing it. It has to be organized and -planned and -paid for. Our
armed men cannot function unless we -provide and maintain the pro
ductive machinery at home. And to kee-p all of this machinery moving
at high sneed takes money in unprecedented amounts.
It is not merely a matter of raising the money. It is really
a Question of how it is raised. In deciding how the money should
be obtained, there are two major questions which must be kept in
mind: What is the effect of any -pro-posed method of raising money
upon the problem of inflation? And how does the method proposed
distribute the economic burden of the war?
A basic economic fact today is that something more than half
of our resources will soon be devoted to the production of instru
ments of war. One out of evnry two wage earners will be receiving
income for contributing to the production of goods that he cannot
purchase. Unless wn utilize to the utmost all possible controls,
the excess of purchasing power over the volume of consumer goods
produced must lead to a rise in prices. And such a rise would add
immeasurably to the costs, and to the hardships of war.
One of the ways to combat inflation is to reduce the amount
that consumers try to spend. Inflation, itself, does not reduce
the quantity of goods available for people to buy; but it does
change the distribution of those goods in a. very unfair manner, de
priving those of sma.ll incomes of goods which they should have,
thus leaving more of an already scanty supply for people who can
afford to pay the increased prices. What we must devise is a means
which will not only reduce the demand for goods, but also distrib
ute that reduction in an equitable manner.
33-14
The simple, "but startling, fact is that taxes are not them
selves the cost of war. The cost is there inevitably. Taxes have
a very different function. Their function is to distribute that
cost among the members of the community, in as fair a manner as
possible, while maintaining our economic system in a vigorous po
sition during the war years, and for the post—war period.
The insistent auestion remainsi How should we raise the tax
revenues we must have? On examination, this Question turns out
to be, not a. matter of how, but of where. On whom should the bur
den be imposed?
One answer to this basic Question is given by many who a.rgue
that it is desirable that every individual in the community, re
gardless of his income, be required to pay part of the additional
taxes. The Treasury has■taken a different view, and has endeav
ored to formulate a tax policy which recognizes that there are
large groups in the community whose standards of living are so
low, that they should not be called upon to pay any more than the
substantial amount of taxes they are now required to pay.
Admittedly, there is no such thing as an absolute minimum
standard of living. Standards of living: that we have no hesitancy
in reducing; today seemed very low in better times, when we could
use all our resources for the production of consumer goods. But
it is one thing to say that we must adjust our potions of the min
imum standard of living to the changed situation; it is a very
different thing to say that we must discard completely the^idea
that there is a group in our community i»rith standards of living so
low that we cannot afford to reduce them still further.
The auestion is more than one of mere fairness or equity.
shall lose more than we gain, if f#* so reduce the standard of liv
ing of our citizens as to impair their morale and their productive
efficiency.
Our people are ready to pay the price that the war imposes.
They are ready to bear its heavy burdens. But they do, demand,
and" quite properly, that these burdens be distributed fairly; tha*t
we count not heads, but the ability of individuals to share in the
cost.
A gen eral retail sales tax is vigorously advanced in many
quarters. Whet is the effect of a sales tax upon inflation? How
would such a tax operate to distribute the economic^burden of war?
The sales tax does not give an adequate answer to either of these
questions.
That the sales tax distributes the cost of the war in an in
equitable manner needs little comment. The s^les tax falls heaviest
on individuals with the lowest standards of living, since such in
dividuals are forced to spend all of their income on the "basic ne
cessities of life. The sales tax falls least heavily oh persons
whose incomes leave them a substantial margin for savihgs or for
luxury spending. Fo one would propose that we enact an income tax
without exemptions at a rate of 10 percent on a $500 incdmei at a
rate of 6 percent on a $2,500 income, and at a rate of 3 percent
on a $10,000 income* Tet such a proposal would distribute the bur
den in the same way as a flab 10 percent retail sales tax. The
only difference is in name, not in substance.
A sales tax is too crude an instrument to perform the function
of inflation control. It cannot discriminate between persons who
can, and who cannot, reduce their purchases substantially. It hits
all alike. In consequence, it is impossible to impose a sales tax
at sufficiently high rates to curtail the consumption of persons
whose living standards are liberal, without at the same time levy
ing an intolerable burden on tens of millions of our citizens. If
imposed at low rates, the sales tax will exercise little or no re
straining influence on the persons who are in the best position to
reduce their standards of living.
The results we desire can be accomplished in a far more
straightforwa.rd manner by means of a spendings tax.
That tax is designed to serve two complementary functions,
First, to withdraw money from the purchasing stream, and thus to
deal directly with the inflation problem; and, second., to distrib
ute the war burden where it can best be borne.
The spendings tax withdraws money from the purchasing stream
in two ways. In the first place, it requires that all ind.ividuals,
except those with the very lowest incomes, turn over to the Treasury
a percentage of the amount they spend. The money so turned over is
obviously no longer available to compete for the purchase of goods.
But the spendings tax does more than that. It also gives an in
centive to save ra.ther than to spend. And the money which is saved,
though not taken as tax revenue, is nevertheless removed from the
spending stream.
As a major instrument for withdrawing purchasing power directly,
the Treasury proposes that all individuals with incomes above sub
sistence levels be required to turn over to the Treasury 10 percent
of the amount they spend, tie propose that a married couple with no
children be exempt from this contribution only if their income is
less than ¿1,000 a. year; that a, married couple with two children be
exempt only if their income is less than $1,500 a year; - and that
a single person be exempt only if his income is less than $500 a
year.
This is going: far down the income scale, farther than any of
us would like to go in ordinary times* But these are not ordinary
times. We can now afford to exempt only persons at the very lowest
living levels*
Because we morose going farther down the income tax scale
than would he tolerable in ordinary times, we think that the 10
percent that people are to contribute, should not be a permanent
contribution, but should be returned to them after the war when we
can once again use all our resources for the production of consumer
goods and services.
This 10 percent contribution vrill be paid by over 30 million
persons, and will withdraw approximately $4,5 billion in purchasing
power. Because it is levied on spending, and not on income, it
vrill give individuals an incentive to save. Any amounts they save
will be subtracted from their income in computing the amount they
must contribute. Thus there is automatic adjustment for those who
must use part of their incomes for the re-payment of debt, or for
other fixed commitments.
The incentive to save, however, vrill be small in the upper
reaches of the income scale. Individuals at these levels have
ample margins with which to meet a. 10 percent addition to the cost
of goods and. services, particularly when this addition is to be re
turnable to them alter the war, Conseauently, the Treasury pro
poses, as an integral part of its program, a steeply graduated tax
on luxury spending. This tax would not be returnable after the war,
since it would be paid only by persons with relatively liberal
standards of living.
This graduated spendings tax would, apply to a, married couple
without children, only if they spent more than $2,000 on consumer
goods and. services. The first $2,000 such a married couple spent
would, be free from tax. It would, constitute a basic expend.iture
ration. The married couple could, of course, spend any amount
above this that they wished, but they would have to pay an increas
ingly severe price for doing so. Bor the first $2,000 they spent
above their ba.sic ration they would have to pay 10 percent; for the
next $2,000 they would have to pay 20 percent. The additional
price they would have to pay for each dollar of exnenditure would
increase, until any married couple that spent more than $20,000
above its expenditure ration, would have to turn over to tne treasury
75 cents for every additional dollar they spent.
The graduated spendings surtax provides the element of flexi
bility that a sales tax so sadly lacks. It makes it possible to
apply d.ifferentia,! pressure to persons at different places in the
income scale. By use of the spendings surtax it is possible to
discourage high level luxury spending without at the same time
- 5 -
imposing a heavy "burden on parsons with low standards of living.
In short, the spendings surtax is selective in its impact, bringing
pressure to "bear where pressure is needed.
These proposals of the Treasury will reach over two-thirds of
total consumer spending, A spendings tax will reach over $50
"billion out of total consumer spendings in the neighborhood of $75
billion. A retail sales tax with as broa.d a, scope as fee.sible,
will reach somewhat less than this amount. A retail sales tax with
food exempt will reach only a little over $30 billion.
The two principal measures that have generally been advanced
for tapping mass purchasing power are the genera,! Sales Tax and
the individual Income Tax. The Sales Tax has the merit that it
hits directly at consumer spending. Its defects are that it dis
tributes the burden in an inequitable manner, and is incapable of
imposing sufficient pressure on luxury spending. The individual
income tex has the virtue that it can exempt the lowest incomes,
and can be made progressive. Under present conditions, it is dif
ficult to increase it as much as we need, because it makes no al
lowance for fixed commitments to repay debts, to pay insurance
premiums, and to make regular savings — forms of expenditures
tha.t exert no inflationary pressure.
The spendings tax has the merits of both the Sales Tax and. of
further increases in the individual income tax, while having the
defects of neither. It hits directly at spending, permitting debt
repayment, insurance premiums, and the like to be deducted.. At
the same time it is progressive, and places a severe penalty on
luxury spending.
Our problem
d.eal effectively
not be ignored.
of these fa.ctors
has many facets. Ue must raise revenue, Ue must
with inflation. Questions of simple equity must
ITo solution which falls to take into account all
will d.o the job that must be done.
- 3 ~
IV.
X*
PAIMART
Payment at par and accrued interest, If any, for no tea allotted hereunder
muet be made or completed on or before September
2 $, 19 4 2 , or on later allotment.
In every case «here payment is not so completed, the payment with application up
to 5 percent of the amount of notee applied for shall, upon declaration made by tht
Secretary of the Treasury in hie discretion, be forfeited to the United States.
'
Any qualified depositary will be permitted to make payment by credit for notes
allotted to it for itself and its customers up to any amount for which it
t*
qualified in excess of existing deposits, when so notified by the Federal Reserve
Bank of its district.
V.
1.
GUiSRAL PROVISIONS
As fiscal agents of the United States, Federal Reserve Banks are authorI
lead and requested to receive subscriptions, to make allotments on the basis and up
to the amounts indicated by the Secretary of the Treasury to the Federal Reserve
j
®anks of the respective districts, to issue allotment notices, to receive payment
for notee allotted, to make delivery of notee on full-paid subscriptions allotted,
and they may issue interim receipts pending delivery of the definitive notee.
2 . The Secretary of the Treasury may at any time, or from time to time,
prescribe supplemental or amendatory rules and regulations governing the offering,
which w i n be communicated promptly to the Federal Reserve Banks.
I
HasKt M a u i ,
jr..
Secretary ot the ft-eaetuy.
-
2
-
in payment of income and profit« taxes payable at the maturity of the notes.
4.
The notes will be acceptable to secure deposits of public moneys, but
will
not bear the circulation privilege.
5.
Bearer notes with interest coupons attached will be issued in denomination*
of $100, $500, $1,000, #5,000, $10,000 and $100,000.
The notes will not be issued
in registered form.
6 . The notes will be subject to the general regulations of the fre&suiy Depart,
aant, now or hereafter prescribed, governing United States notes,
HI.
1*
308SCHIPTIG» AMO
allotmjkt
Subscriptions will be received at the Federal Beserve
and at the Treasury Department, Washington.
Banks and Branches
Subscribers must agree not to sell or
otherwise dispose of their subscriptions, or of the securities which may be allotted
thereon, prior to the closing of the subscription books.
Banking institutions
generally may submit subscriptions for account of customers, but only the Federal
Reserve Banks and the Treasury Department are authorised to act
as official agencies,
Others than banking institutions will not be permitted to enter subscriptions ex
cept for their own account.
Subscriptions from banks and trust companies for their
own account will be received without deposit.
be accompanied by payment of
2,
Subscriptions from all others must
5 percent of the amount of notes applied for*
The Secretary of the Treasury reserves the right to reject any subscrip
tion, in whole or in part, to allot less than the amount of notes applied for, and
to close the books as to any or all subscriptions at any time without notice! and
any action he may take in these respects shall be final.
Subject to these reserva
tions, subscriptions for amounts up to and including #25,00 0 will be allotted in
full.
The basis of the allotment on all other subscriptions will be publicly
announced, and allotment notices will be sent out promptly upon allotment.
1-1/4 PSSCaiT TRJiASUOT
Ditad and
MOTES OP a m 11« O-I945
beating interest from September 25, 1942
Dae March
Interest payable March 15 and September
1942
iapartment Circular
1 5 , 19y
15
TREASURY DfiPAKTttaiT,
80 . 694
Office of the Secretary,
Washington, September 10 ,
19&
fisc&l Service
B«r«au of the Public Debt
I* C O T K or MOfIS
1.
\ -V"/s
She Secretary of the Treasury, pursuant to the authority of the
U b e r t y Bond Act,
as
amended, twite, subscriptions, at par and accrued interest,
from the p ~ p l . of the Unit«! States for note, of the United
1-1/4 percent Twweury fiotee of Sarie. 0-1945.
States,
designated
Die amount of the offering i.
$1,500,000,000, or thereabout«»
H.
1.
O^SCRIPflOS OF »0TSS
The notea «ill be dated September 25, 1942, and »ill bear Interest free
that date at the rate of 1-1/4 percent per annua, payable on a semiannual basis on
haroh 15 and September 15 in each year until the principal amount becomes payable.
» V
will mature March 15, 1945, and will not be subject to call for redemption
prior to maturity.
2 . The income derived from the notes shall be subject to all Fsderal taxes,
now or hereafter imposed.
The notes shall be subject to estate, inheritance, gift
or other excise taxes, whether
Federal or State, but shall be exempt from all taxa
tion now or hereafter imposed on the principal or interest thereof by any State,
or any of the possessions of the United States, or by any local
3-
taxing authority.
Ttia notea will be accepted at par during such time and under such roles
regulations as shall be prescribed or approved by the Secretary of the Treasury
- 3 hereunder must be made or completed on or before September 21, 1942, or on later
allotment*
In every ease «here payment 1« not ao completed, the payment with
application op to 5 percent of the amount of certificates applied for shall, upon
declaration made by the Secretary of the Treasury In his discretion, be forfeited
to the United States*
Any qualified depositary «ill be permitted to sake payment
by credit for certificates allotted to it for itself and its customers up to any
amount for which it shall be qualified in excess of existing deposits, when so
notified by the Federal Reserve Bank of its District«
f.
1«
aiKEEài m m s i c m
As fiscal agents of the United States, Federal Reserve Banks axe author-
ised and requested to receive subscriptions, to make allotments on the basis and
up to the amounts indicated by the Secretary of the Treasury to the Federal Re
serve Banks of the respective districts, to issue allotment noticee, to receive
payment for certificates allotted, to make delivery of certificatea on full-paid
subscriptions allotted, and they may issue interim receipts pending delivery of
the definitive certificates*
2*
Hie Secretary of the Treasury may at ary time, or from time to time,
prescribe supplemental or amendatory rules and regulations governing the offerimg, which will be communicated promptly to tho Federal Reserve Banks*
a m irnmn,
jr
.,
Secretary of the Treasury*
- 2 4»
Bearer certificates with one interest coupon attached sill be issued in
denominations of $1*000, $5*000* $10*000 and $100*000«
The certificates «ill not
be issued in registered fere«
5«
The certificates will be subject to the general regulations of the
Treasury Department* now or hereafter prescribed* governing United States certifi
cates«
111«
1,
SUBSCRIPTION AM)
a LLOTKSNT
Subscriptions «ill bs received at the Federal Reserve Banks and Breaches
and at the Treasury Department* Washington*
Subscribers must agree not to sell
or otherwise dispose of their subscriptions* or of the securities which
allotted thereon* prior to the dosing of the subscription books.
m y be
Banking insti
tutions generally may submit subscriptions for account of customers* but only
tbs Federal Reserve Banks and ths Treasury Department are authorised to act as
official agencies«
Others than banking institutions will not bs permitted to
miter subscriptions except for their own account.
Subscriptions from banks and
trust companies for their own account will be received without deposit*
Sub
scriptions from all others nest be accompanied by payment of 5 percent of the
amount of certificates applied for«
2.
The Secretary of the Treasury reserves the right to reject any subscrip
tion* in whole or in part* to allot leas than ths amount of certificates applied
for* and to close the books as to any or all subscriptions at any tins without
notice | and any action he may take in these respects S h a n be final«
Subject to
these reservations* subscriptions for amounts up to and including $25*000 will be
allotted in
full* The basis of the allotment on all other subscriptions will be
publicly announced* and allotment notices will bs sent out promptly upon allo taen t.
XV,
1«
PAYMENT
Payment at par and accrued interest* If any* for certificates allotted
Ü81TSD STATES OF ÂMBRIGA
0
.6 5 m C S K T TREASURY CERTIFICATES OF INDEBTEDNESS OF SERIES C-1963
Dated and bearing interest from September 21, 1962
Due ifey 1, 1963
TREASURY DEPARTMENT,
Office of the Secretary,
Washington, September IQ,
1962
Department Circular Ho. 691
\%
Fiscal Sendee
Bureau of the Public Debt
I.
1.
OFFERING OF CERTIFICATES
The Secretary of the Treasury, pursuant to the authority of the Second
Liberty Bond Act, as attended, inrites subscriptions, at par and accrued interest,
from the people of the United States for certificates of indebtedness of the
United States, designated 0.65 percent Treasury Certificates of Indebtedness of
Series 0-1965«
The aaount of the offering is $1,500,000,000, or thereabouts.
il.
1.
v E s t m m m or
certificates
The certificates will be dated September 21, 1962, and «ill bear interest
fro© that date at the rate of 0.615 percent per annun, payable on an annual basis at
the maturity of the certificates.
They «ill mature May 1, 1963, and will not be
subject to call for redeoption prior to maturity.
2.
The income derived from the certificates shall be subject to all Federal
taxes, no« or hereafter Imposed.
The certificates shall be subject to estate,
inheritance, gift or other excise taxes, «bather Federal or State, but shall be
exempt from all taxation no« or hereafter lapoaed on the principal or interest
thereof by any State, or any of the possessions of the United States, or by any
local taxing authority.
3«
The certificates will be acceptable to secure deposits of public moneys*
v
They «ill not be acceptable in payment of taxes and «ill not bear the circulation
privilege.
Subscriptions for both 1sane© will be received at the Federal
Keserve Banks and Branches, and at the Treasury Department, Washington.
Banking institutions generally may submit subscriptions for account of
customers, but only the Federal Reserve Baraks and the Treasury Depart
ment are authorised to act as official agencies. Subscriptions from
banks and trust companies for their own account «dll be received with
out deposit, but subscriptions from all others must be accompanied by
payment of 5 percent of the amount applied for*
The bases of allotment of subscriptions over $25,000 «dll be publicly
announced.
Payment for any certificates allotted must be made or completed
on or before September 2 1 , 1942 , or on later allotment, and for the notes
on or before September 25, 1942, or on later allotment*
The certifl cates
will be redeemed in cash at maturity and will carry no exchange privileges.
The texts of the official circulars follow:
îftg&^UE! DEPARTMENT
■ashington
FOR
awf/v £ mmim imm?àfmsÿ
Thursday » heptomber i.0 » 1 /42»
9/9/42
Press Sendee
No*
Secretary of the Treasury Morgenthau today announced the offering,
through the Federal Reserve Banks, for cash subscription at par and
accrued interest, of II,5»00,000,000, or thereabouts, ofo*6$ percent
Treasury Certificates of Indebtedness of .Series C-1943, and of
$1,500,000,000, or there bouts, of 1-1/4 percent Treasury Notes of
aeries C-1945*
In order to insure aware extensive participation in this
offering the subscription books for both issues will remain open two
days, and ail subscriptions up to $25,000 «dll be allotted in full*
There will be no restrictions as to the basis for subscribing to these
issues*
The certificates win be dated September 21, 1942, «dll be payable
on May
1, 1943#
and will bear interest at the rate of 0.65 percent per
annum, payable on an annual basis at the maturity of the certificates*
They will be issued in bearer form only, in denominations of $1,000,
$5,000, $10,000 and #100,000*
The notes will be dated September 25, 1942, will Mature March 15,
1945 , and, will bear interest at the rate of 1 -1/4 percent per annum, payable
on a semiax'diual basis on March 15 and September 15 in each year until the
principal amount deceases payable,
they «ill be issued in bearer form only,
in denominations of $100, $500, $1,000, $5#000, $10,000 and 1100,000*
Pursuant to the provisions of the Public Debt Ret of 1941# interest
upon the securities new offered shall not have any exemption, as such,
under Federal Tax Acts now or hereafter enacted.
The full provisions relat
ing to taxability are set forth in the official circulars released today.
TREASURY DEPARTMENT
Washington
FOR RELEASE, MORNING* NEWSPAPERS,
Thursday, September 10, 19^2.
970/lfë
Press Service
No. 33-15
Secretary of the Treasury Morgenthau today announced the
offering, through the Federal Reserve Banks, for cash subscrip
tion at par and accrued interest, of $1,500,000,000,
or there
abouts, of O.65 percent Treasury Certificates of Indebtedness of
Series C-19^3, and of $1,500,000,000, or thereabouts, of 1-1/^
percent Treasury Notes of Series C-19^5*
In order to insure more
extensive participation in this offering the subscription books
for both issues will remain open two days, and all subscriptions
up to $25,000 will be allotted in full.
There will be no re
strictions as to the basis for subscribing to these issues.
The certificates will be dated September 21, 19^2, will be
payable on May 1, 19^3> and will bear interest at the rate of
O .05 percent per annum, payable on an annual basis at the matu
rity of the certificates. They will be issued in bearer form
only, in denominations of $1,000, $5,000, $10,000 and $100,000.
The notes will be dated September 25 , 19^2, will mature
March 15, 1 9 ^5 > and will bear interest at the rate of 1 - 1 / 1+ per
cent per annum, payable on a semiannual basis on March 15 and
September 15 in each year until the principal amount becomes pay
able. They will be issued in bearer form only, in denominations
of $100, $500, $1,000, $5,000, $10,000 and $100,000.
Pursuant to the provisions of the Public Debt Act of 19^1,
interest upon the securities now offered shall not have any
exemption, as such, under Federal Tax Acts now or hereafter en
acted. The full provisions relating to taxability are set forth
in the official circulars released today.
Subscriptions for both issues will be received at the Federal
Reserve Banks and Branches, and at the Treasury Department,
Washington. Banking institutions generally may submit subscrip
tions for account of customers, but only the Federal Reserve Banks
I
- 2 -
and the Treasury Department are authorized to aot as official
agencies. Subscriptions from banks and trust companies for
their own account will be received without deposit, but sub
scriptions from all others must be accompanied by payment of
5 percent of the amount applied for.
The bases of allotment of subscriptions over $25,000 will
be publicly announced. Payment for any certificates allotted
must be made or completed on or before September 21, 1942, or
on later allotment, and for the notes on or before September 25 ,
19^2, or on later allotment. The certificates will be redeemed
in cash at maturity and will carry no exchange privileges.
The texts of the official circulars follow:
UNITED STATES OF AMERICA
0.65 PERCENT TREASURY CERTIFICATES OF INDEBTEDNESS OF SERIES C-1943
Due May 1, 1943
Dated and bearing interest from September 21, 1942
1942
Department Circular No. 691
TREASURY DEPARTMENT,
Office of the Secretary,
Washington, September 10, 1942,
Fiscal Service
Bureau of the Public Debt
I.
OFFERING OF CERTIFICATES
1. The Secretary of the Treasury, pursuant to the authority of the Second
Liberty Bond Act, as amended, invites subscriptions, at par and accrued interest,
from the people of the United States for certificates of indebtedness of the
United States, designated 0.65 percent Treasury Certificates of Indebtedness of
Series C-1943* The amount of the offering is 61^500,000,000, or thereabouts.
II.
DESCRIPTION OF CERTIFICATES
1. The certificates will be dated September 21, 1942, and will bear interest
from that date at the rate of 0.65 percent per annum, payable on an annual basis at
the maturity of the certificates. They will mature May 1, 1943, and will not be
subject to call for redemption prior to maturity.
2. The income derived from the certificates shall be subject to all
Federal taxes, now or hereafter imposed. The certificates shall be subject
to estate, inheritance, gift or other excise taxes, whether Federal or State,
but shall be exempt from all taxation now or hereafter imposed on the principal
or interest thereof by any State, or any of the possessions of the United
States, or by any local taxing authority.
3. The certificates will be acceptable to secure deposits of public
moneys. They will not be acceptable in payment of taxes and will not bear
the circulation privilege.
4* Bearer certificates with one interest coupon attached will be issued
in denominations of §~L30QQ3 65>000, 610,000 and 6100,000. The certificates
will not be issued in registered form.
5. The certificates will be subject to the general regulations of the
Treasury Department, now or hereafter proscribed, governing United States
certificates.
-
III.
2
-
SUBSCRIPTION AND ALLOTMENT
1. Subscriptions will be received at the Federal Reserve Banks and
Branches and at the Treasury Department, Washington. Subscribers must agree
not to sell or otherwise dispose of their subscriptions, or of the securities
which may be allotted thereon, prior to the closing.of the subscription books.
Banking institutions generally may submit subscriptions for account of
customers, but only the Federal Reserve Banks and the Treasury Department
are authorized to act as official agencies. Others than banking institutions
will not be permitted to enter subscriptions except for their own account.
Subscriptions from banks and trust companies for their own account will be
received without deposit. Subscriptions from all others must be accompanied
by payment of 5 percent of the amount of certificates applied for.
2. The Secretary of the Treasury reserves the right to reject any sub
scription, in whole or in part, to allot less than the amount of certificates
applied for, and to close the books as to any or all subscriptions at any
time without notice] and any action he may take in these respects shall be
final. Subject to these reservations, subscriptions for amounts up to and
including 525,000 will be allotted in full. The basis of the allotment on
all other subscriptions will be publicly announced, and allotment notices
will be sent out promptly upon allotment.
IV.
PAYMENT
1. Payment at par and accrued interest, if any, for certificates
allotted hereunder must be made or completed on or before September 21, 194-2,
or on later allotment. In every case where payment is not so completed, the
payment with application up to 5 percent of the amount of certificates
applied for shall, upon declaration made by the Secretary of the Treasury
in his, discretion, be forfeited to the United States. Any qualified de
positary will be permitted to make payment by credit for certificates
allotted to it for itself and its customers up to any amount for which
it shall be qualified in excess of existing deposits, when so notified by
the Federal Reserve Bank of its District.
V.
GENERAL PROVISIONS
1. As fiscal agents of the United States, Federal Reserve Banks are
authorized and requested to receive subscriptions, to make allotments on the
basis and up to the amounts indicated by the Secretary of the Treasury to
the Federal Reserve Banks of the respective districts, to issue allotment
notices, to receive payment for certificates allotted, to make delivery of
certificates on full-paid subscriptions allotted, and they may issue interim
receipts pending delivery of the definitive certificates.
3 2# The Secretary of the Treasury may at any time, or from time to tirtie,
prescribe supplemental or amendatory rules and regulations .governing the
offering, ■which will be communicated promptly to the Federal Reserve Banks.
HENRY MCR GENTHAU, JR.,
Secretary of the Treasury.
UNITED STATES OF AMERICA
1-1/4 PERCENT TREASURY NOTES OF SERIES C-1945
Dated and bearing interest from September 25, 1942
Due March 15, 1945»
Interest payable March 15 and September 15
TREASURY DEPARTMENT,
Office of the Secretary,
Washington, September 10, 1942.
1942
Department Circular No. 694
Fiscal Service
Bureau of the Public Debt
I.
OFFERING OF NOTES
1. The Secretary of the Treasury, pursuant to the authority of the
Second Liberty Bond Act, as amended, invites subscriptions, at par and
accrued interest, from the people of the United States for notes of the
United States, designated 1-1/4 percent Treasury Notes of Series C-1945.
The amount of the offering is $1,500,000,000, or thereabouts.
II.
DESCRIPTION OF NOTES
1. The notes will be dated September 25, 1942, and will bear interest
from that date at the rate of 1-1/4 percent per annum, payable on a semi
annual basis on March 15 and September 15 in each year until the principal
becomes payable. They will mature March 15, 1945, and will not be subject
to call for redemption prior to maturity.
2. The income derived from the notes shall be subject to all Federal
taxes, now or hereafter imposed. The notes shall be subject to estate, in
heritance, gift or other excise taxes, whether Federal or State, but shall be
exempt from all taxation now or hereafter imposed on the principal or interest
thereof by any State, or any of the possessions of the United States, or by
any local taxing authority.
3. The notes will be accepted at par during such time and under such
rules and regulations as shall be prescribed or approved by the Secretary of
the Treasury in payment of income and profits taxes payable at the maturity
of the notes.
4. The notes will be acceptable to secure deposits of public moneys,
but will not bear the circulation privilege.
-
2
-
5. Bearer notes "with interest coupons attached will be issued in de
nominations of $100, $500, $1,000, $5,000, $10,000 and $100',000. The notes
will not be issued in registered form,.
6. The notes will be subject to the general regulations of the Treasury
Department, now or hereafter prescribed, governing United States notes.
III.
SUBSCRIPTION AND ALLOTMENT
1. Subscriptions will be received at the Federal Reserve Banks and
Branches and at the Treasury Department, Washington. Subscribers must agree
not to sell or otherwise dispose of their subscriptions, or of the securities
which may be allotted thereon, prior to the closing of the subscription books.
Banking institutions generally may submit subscriptions for account of
customers, but only the Federal Reserve Banks and the Treasury Department
are authorized to act as official agencies. Others than banking institutions
will not be permitted to enter subscriptions except for their own account.
Subscriptions from banks and trust companies for their own account will be
received without deposit. Subscriptions from all others must be accompanied
by payment of 5 percent of the amount of notes applied for.
2. The Secretary of the Treasury reserves the right to reject any sub
scription, in whole or in part, to allot less than the amount of notes applied
for, and to close the books as to any or all subscriptions at any time without
notice $ and any action he may take in these respects shall be final. Subject
to these reservations, subscriptions for amounts up to and including $2 5 , 0 0 0
will be allotted in full. The basis of the allotment on all other sub
scriptions will be publicly announced, and allotment notices will be sent
out promptly upon allotment.
IV.
PAYMENT
1. Payment at par and accrued interest, if any, for notes allotted
hereunder must be made or completed on or before September 25, 1942, or on
later allotment. In every case where payment is not so completed, the pay
ment with application up to 5 percent of the amount of notes applied for shall,
upon declaration made by the Secretary of the Treasury in his discretion, be
forfeited to the United States. Any qualified depositary wall be permitted
to make payment by credit for notes allotted to it for itself and its
customers up to any amount for which it shall be qualified in excess of ^
existing deposits, when so notified by the Federal Reserve Bank of its district.
V.
GENERAL PROVISIONS
1. As fiscal agents of the' United States, Federal Reserve Banks are
authorized and requested to receive subscriptions, to make allotments on the
- 3basis and up to the amounts indicated by the Secretary of the Treasury to
the Federal Reserve Banks of the respective districts, to issue allotment
notices, to receive payment for notes allotted, to maKe delivery of notes
on full-paid subscriptions allotted, and they may issue interim receipts
pending delivery of the definitive notes.
2. The Secretary of the Treasury may at any time, or from time to time 3
prescribe supplemental or amendatory rules and regulations governing the
offering, ■milch "will be communicated promptly to the Federal Reserve Banks.
HENRY MORSEFTIIiUJ, JR.,
Secretary of the Treasury.
FOR IMMEDIATE RELEASE
September 9. 1942.
3
3"
The Bureau of Customs announced today preliminary figures showing the
quantities of coffee authorized for entry for consumption under the quotas
for the twelve months commencing October 1, 194-1, provided for in the InterAmerican Coffee Agreement, proclaimed by the President on April 15, 1941,
as follows:
Country of Production
Signatory Countries:
Brazil
Colombia
Costa Hica
Cuba
Dominican Republic
Ecuador
El Salvador
Guatemala
Haiti
Honduras
Mexico
Nicaragua
Peru
Venezuela
:: Quota Quantity :
Authorized for entry
:: (Pounds) l/ :
for consumption
: (Pounds)
::
: ¡Is of (Date)
1,821,836,025
617,483,151
39,105,707
15,726,029
23,523,302
29,415,140
123,701,103
104,900,424
53,068,211
4,191,694
96,438,728
40,893,390
4,897,12^^
57,080,663..
Non-signatory countries:
British Empire, except
Aden and Canada
Kingdom of the Netherlands
and its possessions
Aden, Yemen, and Saudi
Arabia
Other countries not signatories of the Inter-American
Coffee Agreement
1/
2/
August 29, I942
tt
9a , 468,454
483,451,535
Sept. 5, 1942 2/
31,904,055
August 29, I942
6,662,204
(Import quota filled)
Sept. 5, 1942 2f
18,859,275
87,240,336
August 29, I942
Sept. 5, 1942 2/
92,691,729
«
y
40,559,687
(Import quota filled)
40,333,426
August 29, 1942
«
32,407,372
3,214,440
Sept. 5, 1942 2/
«
2/ 51,335,654
22,976,474
(Import quota filled)
25,570,406
(Import quota filled)
5,034,821
(Import quota filled)
15,959,761
(Import quota filled)
Quotas revised effective February 26, 1942, and July 16, 1942.
Per telegraphic reports.
-oOo-
TREASURY DEPARTMENT
Washington
FOR IM M E D IA T E RELEASE,
Thursday^ S e p t e m b e r 10» 1942, '
Press Service
No. 33-16
The B u r e a u of Customs a n n ounced today p r e l i m i n a r y figures
showing the qua n t i t i e s of coffee a u t h o r i z e d for entry for c o n
s u m ption u n d e r the quotas for the twelve m o n t h s
O c t o b e r 1, 1941,
Agreement,
c o m m encing
p r o v i d e d for in the I n t e r - A m e r i c a n Coffee
p r o c l a i m e d by
the P r e s i d e n t on A p ril 15,
1941,
as
follows :
Country of Production
Signatory Countriesi
Brazil
Colombia
Costa Pica
Cuba
Dominican Eepublic
Ecuador
El Salvador
Guatemala
Haiti
Honduras
Mexico
Nicaragua
Peru
Venezuela
Non-signatory countries!
British Empire, except
Aden and Canada
Kingdom of the Netherlands
and its possessions
Aden, Yemen, and Saudi
Arabia
Other countries not signa
tories of the Inter-American
Coffee Agreement
Quota Quantity,
Authorized for Entry
(Pounds) 1!
I
for consumption_____
_________ !As of (Date)
:
(Pounds)
1,821,836,025
617,483,151
39,185,707
15,726,029
23,523,302
29,415,140
123,781,103
104,900,424
53,868,211
4,191,694
96,438,728
40,893,390
4,897,122
57,080,665
August 29, 1942 921,468,454
it
483,451,535
Sept. 5, 1942 2/ 31,904,055
August 29, 1942
6,662,204
(import quota filled)
Sept. 5, 1942 2/ 18,859,275
August 29, 1942 87,240,336
Sept. 5, 1942 2/ 92,691,729
n
2 ! 40,559,687
(import quota filled)
August 29, 1942 40,333,426
0
32,407,372
3,214,440
Sept. 5, 1942 2j
it
2/ 51,335,654
22,976,474
(import quota filled)
25,570,406
(Import quota filled)
5,034,821
(import quota filled)
15,959,761
(import quota filled)
1j Quotas revised effective February 26, 1942, and July 16, 1942
2j Per telegraphic reports.
I t
V 7
FOR IMMEDIATE RELEASE,
September 9. 1942,
The Bureau of Customs announced today preliminary figures showing the quanti
ties of wheat and wheat flour entered, or withdrawn from warehouse, for consumption
under the import quotas established in the President's proclamation of May 28,
1%1
ptioj
as modified by the President's proclamation of April 13, 1942, for the twelve months
commencing May 29, 1942, as follows!
Country
of
Origin
•
•
•
•
:
:
j
•
•
Canada
China
Hungary
Hong Kong
Japan
United Kingdom
Australia
Germany
Syria
New Zealand
Chile
Netherlands
Argentina
Italy
Cuba
France
Greece
Mexico
Panama
Uruguay s ' * ^
Poland a#d Danslg^*
Sweden
Yugoslavia
Norway
Canary Islands
Rumania
Guatemala
Brazil
Union of Soviet
Socialist Republics
Belgium
tkt
WHEAT
:
Imports
Established sMay 29, 1942 to
Quota
¡August 29. 19^2
(Bushels)
(Bushels)
795,000
—
100
—
100
100
—
—
100
2,000
100
—
1,000
100
—
1,000
100
100
100
100
800,000
795,000
—
—
—
—
Wheat flour, semolina,
crushed or cracked wheat, and
similar wheat products
•
Imports
Established i May 29, 1942, to
Quota
: August 29. 1942
(Pounds)
(Pounds)
—
—
—
_
-
3,815,000
24,000
13,000
13,000
8,000
75,000
1,000
5,000
5,000
1,000
1,000
1,000
14,000
2,000
12,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
-
-
-
—
795,000
-oOo-
4,000,000
3,792,620
—
-
-
UK
J<
—
—
44
-
¡mVj
j
-
!
m
— .
3,792,6«,
¿44
j
1
j
k b
T R E A S U R Y DEPARTMENT
Weis hington
Press Service
FOR IMMEDIATE RELEASE,
Thursday, September 10, 1942.
Ho*
r? n rj
33-1
<
The B u reau o f Customs announced to d a y p r e li m i n a r y f i g u r e s showing th e quan
fa coajii
titie s
o f wheat and wheat f l o u r e n te r e d , o r withdrawn from w areh o u se, f o r con
sum ption under th e im p o rt q u o tas e s t a b lis h e d in th e P r e s i d e n t ’ s p ro c la m a tio n o f
May 2 8 , 1 9 4 1 , as m o d ified by th e P r e s i d e n t ’ s -p ro clam atio n o f A n r il 1 3 , 1 9 4 2 ,
f o r th e tw e lv e months commencing May 2 9 , 1 9 4 2 , a s f o llo w s :
semolina,)
•
•
tedtod,■
t prodacts!
Imports 1
ay29,id
tostM
Wheat f l o u r , se m o lin a ,
cru sh e d o r c ra c k e d w h eat, and
WHEAT
s i m i l a r wheat p ro d u c ts
•
:
Im p o rts
Im p o rts
* E s t a b lis h e d
May 2 9 , 1 9 4 2 to E sta.b lish ed :M a.y 2 9 , 1 9 4 2 , to
Quota
Quota
: August 2 9 . 1 9 4 2
August 2 9 , 1 9 4 2
t
C ou n try
of
O rig in
(Pounds))
3,7W
Canada
China
Hungary
Hong Hong
Ja n an
U n ited Kingdom
A u s tr a lia .
Germany
Syria.
Few Z ealan d
C h ile
F e t herla n d s
A rg e n tin a
Ita ly
Cuba
P ra n ce
G reece
M exico
Panama
Uruguay
P olan d and D anslg
Sweden
Y u g o sla v ia
Norway
Canary I s la n d s
Humani a.
Guatem ala
B ra z il
Union o f S o v ie t
S o c i a l i s t R e p u b lics
Belgium
(B u s h e ls )
(B u s h e ls )
(Pounds)
(Pounds)
7 9 5 ,0 0 0
7 9 5 ,0 0 0
3 , 8 1 5 ,0 0 0
2 4 ,0 0 0
1 3 ,0 0 0
1 3 ,0 0 0
8 ,0 0 0
7 5 ,0 0 0
1 ,0 0 0
5 ,0 0 0
5 ,0 0 0
1 ,0 0 0
1 ,0 0 0
1 ,0 0 0
1 4 ,0 0 0
2 ,0 0 0
1 2 ,0 0 0
1 ,0 0 0
1 ,0 0 0
1 ,0 0 0
1 ,0 0 0
1 ,0 0 0
1 ,0 0 0
1 ,0 0 0
1 ,0 0 0
1 ,0 0 0
1 ,0 0 0
3 ,7 9 2 ,6 2 0
)
—
—
—
—
100
—
100
100
-
—
100
2 ,0 0 0
100
1 ,0 0 0
100
_
—
—
—
—
—
—
—
—
_
—
—
—
_
_
—
_
m
—
—
—
—
—
_
mm
1 ,0 0 0
100
100
100
100
8 0 0 ,0 0 0
—
—
—
-
—
—
—
—
44
i*
—
—
_
_
—
_
_
-y
—
—
..
—
—
—
m
_
40
—
—
—
—
4 , 0 0 0 ,0 0 0
3 ,7 9 2 ,6 6 4
COTTON CARD STRIPS,/COMBER WASTE, LAP WASTE, SLIVER WASTE, AND ROVING WASTE,
WHETHER OR NOT MANUFACTURED OR OTHERWISE ADVANCED IN VALUE, Annual quotas
commencing September 20, by Countries of Origin:
7j
Total quota, provided, however, that not more than 33-1/3 percent/of the
quotas shall be filled by cotton wastes other than card etrips/and comber
wastes made from cottons of 1-3/16 inches or more in staple length in the
case of the following countries: United Kingdom, France, Netherlands,
Switzerland, Belgium, Germany and Italy:
Country of
Origin
United Kingdom,. ....
Canada,,,,,,,,*• ....
France......... ....
British India. ....
Netherlands.»••• ....
Switzerland,.•••....
Belgium..... . ••....
Japan. ........ . .....
China...... . •. •....
Egypt.......... ....
Cuba,
....
Germany........ ....
Italy,......... ....
:
:
*
«
Established
TOTAL QUOTA
4,323,457
239,690
227,420
69,627
68,240
44,388
38,559
341,535
17,322
8,135
6,544
76,329
21,263
(In
:
:
•
•
•é
Pounds)
TOTAL IMPORTS :
Sept. 20, 1941,î
to Ausr. 29.1942:
434
231,613
—
69,627
—
Established : Imports Sept, j
33-1/3% of s 20,1941, 6o
Total Quota : . Aug. 29 . 1942 ]/
1,441,152
75,807
22,747
14,796
12,853
25,443
7,088
434
-
-■
_
I
\
<
■1
Total
\J
2/
5,482,509
301,674
1,599,886
434
Included in total imports, column 2.
The Presidents proclamation, signed March 31, 1942, exempts from import quota
restrictions card strips made from cottons having a staple 1-3/16 inches or
more in length.
FOE IMMEDIATE RELEASE
September 9. 1942.
3
j ■-/ F
The Bureau of Customs announced today that preliminary reports from the Collec
tors of customs show imports of cotton and cotton waste chargeable to the import
quotas established by the President’s proclamation of September 5, 1939, modified
by the proclamations of December 19, 1940, and June 29, 1942, during the period
September 20, 1941, to August 29, 1942, inclusive, as follows:
J*«
j]0
J
I
ìli
COTTON HAVING A STAPLE OF
COTTON OF LESS THAN 3/4
FACTURE OF BLANKETS AND
commencing September 20,
Country of
Origin
LESS THAN 1-11/16 INCHES (OTHER THAN HARSH OR ROUGH
INCH IN STAPLE LENGTH AND CHIEFLY USED IN THE MANU
BLANKETING, AND OTHER THAN LINTERS). Annual quotas
by countries of origin:
Tin Pounds)
:
Staple length less
:
than 1-1/8”
j
: Imports Sept,
s Established : 20, 1941, to
:
Quota
: Ausr. 29. 1942
Egypt and the AngloEgyptian Sudan.•••••.
783,816
Peru....*«•••••••••••••
247,932
British India.........
2,003,483
C
h
i
n
a
.
1,370,791
Mexico..•••••••••••••••
8,883,259
Brazil.......••••••••••
618,723
Union of Soviet Social
ist Republics.......
475,124
A r g e n t i n a . 5,203
Haiti. •«•••.......
237
Ecuador...............
9,333
752
Honduras.......
Paraguay.••••••••••••••
871
Colombia..............
124
Iraq.... .............
195
British East Africa....
2,240
Netherlands East
Indies....•••••..»•••
71,383
Barbados•••••••••.....
Other British West
Indies ! / • • • • .... . •
21,321
Nigeria..........••••••
5,377
Other British West
Africa 2 /*»•••••••••
16,004
Algeria and Tunisia....
Other French Africa ^/. _______ M 2
2/
k!
¡||W
j
Staple length 1-1/8 " or more
but less than l-ll/l6,t
: Imports Sept. 20,
Established : 1941, to August 29,
Quota
: 1942»
_
247,952
70,264
8,883,259
618,723
203
2
9,333
43,451,566
2,056,299
64,942
2,626
3,808
42,295,422
3,122,300
196,930
3
435
506
6
-
-
-
29,909
41,759
-
12,554
-
30
30,139
—
2,002
1,634
—
_
- ■
9.829.766
V
3/,
I!|feiipi
[ ft*
IIirti
45.656.420
4/
¿ 5.656.420,
.516.882
Total
Other than Barbados, Bermuda, Jamaica, Trinidad, and Tobago,
Other than Gold Coast and Nigeria.
Other than Algeria, Tunisia, and Madagascar.
Figures are shown by country of origin, although a ’’global 9u°ta was
by Presidential proclamation of June 29, 1942, effective July 29, 1942.
Co
iljp tii
!Pai
In.
lis lili
lUmii
Ë1L,
iti. .
nador..
Maras.,
'itisli Ea<
Irlands
tiriti
j Piriti
i■^rica2
Il direna
Phed
TREASURY DEPARTMENT
Washington
EOR IMMEDIATE RELEASE,
Fridayy . September 11, 1942.
Press Service
No. 33— 18
The Bureau of Customs announced today that preliminaxy reports from the
collectors of customs show imports of cotton and cotton waste chargeable to
the import quotas established by the Presidents proclamation of September 5,
1939, modified by the proclamations of December 19, 1940, and June 29, 1942,
during the period September 20, 1941, to August 29, 1942, inclusive, as fol
lows i
COTTON HAVING- A STAPLE OP LESS THAN 1-11/16 INCHES (OTHER THAN HARSH OR ROUGH
COTTON OP LESS THAN 3/4 INCH IN STAPLE LENGTH AND CHIEFLY USED IN THE MANU
FACTURE OP BLANKETS AND BLANKETING, AND OTHER THAN LINTERS). Annual quotas
commencing September 20, by countries of origin?
__________________________
(In Pounded------------------------ ;------:
Staple length less
: Staple length l-l/8,r or
:________than 1— l/8"
:more but less than 1-11/16"
Country of
*
• Imports Sept.?
•Imports Sept.
Origin
:Established *. 20, 1941, to : Established :20,1941, to
___________
:
Quota
i Aug. 29, 1942?
Quota
;Aug. 29.1942.
Egypt and the AngloEgyptian Sudan......
Peru....... .........
British India........
China,...............
Mexico............ .
Braz il..,.............
Union of Soviet Social
ist Republics.......
Argentina............
Haiti................
Ecuador.......
|..•
Honduras........ ....
Paraguay..............
Colombia......... .
Iraq.................
British East Africa....
Netherlands East
Indies....... .
Barbados............ .
Other British West
Indies 1/.........
Nigeria..............
Other British West
Africa 2J .........
Algeria and Tunisia....
Other French Africa 3/.
783,816
247,952
2,003,483
1,370,791
8,883,259
618,723
247,952
70,264
8,883,259
618,723
475,124
5,203
237
9,333
752
871
124
195
2,240
203
2
9,333
—
71,388
-
43,451,566
2,056,299
64,942
2,626
-
3,808
42,295,422
3,122,300
-
196,930
3
—
435
506
29,909
..
6
41,759
12,554
21,321
5,377
16,004
30,139
30
2,002
1,634
689
45,656,420 4/ 45,656,420
9.829,766
14.516.882
Jotal
Other than Barbados, Bermuda, Jamaica, Trinidad, and Tobago.
Other than Gold Coast and Nigeria.
3/ Other than Algeria, Tunisia, and Madagascar,
Figures are shown by count iy of origin, although a "global" quota was
established by Presidential proclamation of June 29, 1942, effective
July 29, 1942,
U
ii
COTTON CARD STRIPS 2/, COMBER WASTE, LAP WASTE, SLIVER WASTE, AND ROVING WASTE,
WHETHER OR NOT MANUFACTURED OR OTHERWISE ADVANCED IN VALUE. Annual quotas
commencing September 20, by Countries of Origin:
Total quota, provided, however, that not more than 33-1/3 percent of the
quotas shall be filled by cotton wastes other than card strips 2/ and
comber wastes made from cottons of 1-3/16 inches Or more in staple length
in the case of the following countries: United Kingdom, France,
Netherlands, Switzerland, Belgium, Germany and Italy:
__tin’Pounds) .... ................... .......
; Established : TOTAL IMPORTS
î Established :Imports Sept.
33-1/3# of :20, 1941, to
Sept*
20,
1941,
:
TOTAL
QUOTA
:
Country of :
i to Aug. 29. 1942: Total Quota :Aug. 29 . 1942 1/
Origin
:
434
1,441,152
434
United Kingdom... 4,323,457
231,613
239,690
Canada..........
75,807
227,420
France..... .
69,627
69,627
British India....
22,747
—
68,240
Netherlands......
14,796
—
44,388
Switzerland......
12,853
—
38,559
Belgium.........
341,535
“
J apan............
—
—
17,322
China.......... .
*■**
w
*
—
8,135
Egypt...........
—
6,544
Cuba........... .
25,443
76,329
Germany.........
7,088
21,263
Italy...........
—
5,482,509
301,674
—
•
p
*
1,.599,886
434
1/ Included in total imports, column 2.
2/ The President’s proclamation, signed March 31, 1942, exempts from import quot
restrictions card strips made from cottons having a staple 1-3/16 inches or
more in length.
i
-2-
Commodity
:
Established Quota
:Period & Country: Quantity
: Unit of :Imports as of
: Quantity :August 29. 1%7
Silver or black foxes,
furs, and articles:
Paws, head, or other
separated parts
Piece plates
Articles, other
than piece plates
Crude petroleum, topped
crude petroleum, and
fuel oil
>
Molasses and sugar
sirups containing
soluble nonsugar
solids equal to
more than 6% of
total soluble
solids
i
12 mos. from
Dec. 1, 1941
500
Pounds
(Import quota
filled)
M
550
Pounds
None
It
500
Unit
26
Calendar year
Venezuela
2,082,574,771
Gallon
326,439,310
Netherlands
630,097,196
Gallon
255,507,457
94,662,490
Gallon
(Import quota
filled)
J
Other countries 150,868,343
Gallon
(Import quota
filled)
Colombia
J
Calendar year
1,500,000
Gallon
665,663
- ,e t
FOR B5MEDIATE RELEASE,
September 9. 194-2.
The Bureau of Customs announced today preliminary figures for imports of
commodities within quota limitations provided for under trade agreements, from
the beginning of the quota periods to August 29, 194-2, inclusive, as follows:
:
Established Quota
: Unit of : Imports as of
:Period & Country: Quantity : Quantity: August 29. 1942
Commodity
Cattle less than 200
pounds each
100,000
Head
60,925
Cattle, 700 pounds or
more each (other than
dairy cows)
Quarter year from
July 1, 1942
Canada
51,720
Other countries
8,280
Head
Head
19,652
(Tariff rate
quota filled)
Whole milk, fresh or sour
Calendar year
3,000,000
Gallon
Cream, fresh or sour
Calendar year
1,500,000
Gallon
Fish, fresh or frozen
filleted, etc., cod,
haddock, hake, pollock,
cusk and rosefish
Calendar year 15,000,000
--------------------------------------- j
---------------- /
Calendar year
3,553
-----------------/
White or Irish potatoes
certified seed
Other
12 months from
Sept. 15, 1941 90,000,000
12 months from
Sept. 15
60,000,000
Cuban filler tobacco,
unstemmed or stemmed
(other than cigarette
leaf tobacco), and
scrap tobacco
Calendar Year 22,000,000
Red Cedar Shingles
Calendar year
Pound
10,440,539
Pound
33,030,534
Pound
1,253,855
Pound
(unsteramed
equivalent)
2,617,111
17,079,141
Square
2,113,641
i
Silver or black foxes,
furs, and articles:
Foxes valued under
$250 ea. and whole
furs and skins
Tails
Period MayNov. 1942
All countries
12 months from
Dec. 1, 1941
41,774
5,000
Number
Piece
15,738
(Import quota
fillsd)
TREASURY DEPARTMENT
Washington
Press Service
No. 33-19
EOR IMMEDIATE RELEASE,
Thursday, September 10, 1942.
The Bureau of Customs announced today preliminary figures for imports of
commodities within quota limitations provided for under trade agreements, from the
Commodity
Unit of : Imports as of
Quota
:
Established 1
: Period & Country : Quantity ; Quantity JAugust 29. 194(
Cattle less than 200
pounds each
Calendar year
Cattle, 700 pounds or
more each (other than
dairy cows)
Quarter year fro
July 1, 1942
Canada
Other countries
Whole milk, fresh or sour
Calendar year
5,000,000
Callon
3,553
Cream, fresh or sour
Calendar year
1,500,000
Gallon
546
Fish, fresh or frozen
filleted, etc., cod,
haddock, hake, pollock,
cusk and rosefish
Calendar year
15,000,000
Pound
10,440,539
90.000.
Pound
000
33,030,534
60.000.
Pound
000
1,253,855
White or Irish potatoes
certified seed
Other
12 months from
Sept. 15, 1941
■12 months from
Sept. 15
100,000
Head
51,720
8,280
Head
Head
60,925
19,652
(Tariff rate
quota filled)
Cuban filler tobacco,
unstemmed or stemmed
(other than cigarette
leaf tobacco), and
scrap tobacco
Calendar year
22,000,000
Calendar year
2,617,111
Square
2,113,641
Red Cedar Shingles
Silver or black foxes,
furs, and articles:
Foxes valued under
$250 ea. and whole
furs and skins
Period - May Nov. 1942
All countries
41,774
Number
15,738
12 months from
Dec. 1, 1941
5,000
Tails
Pound
(unstemmed
equivalent)
17,079,141
Piece
(import quota
filled)
-
Commodity
2
-
: Unit of : Imports as of
:
Established Quota
: Period & Country : Quantity * Quantity :August 29, 194;
Silver or black foxes,
furs, and articles»
Articles, other
than niece plates
Crude petroleum, topned
crude netroleura, and
fuel oil
Pounds
(import quota
filled)
ti
550
Pounds
n
500
Unit
12 months from
Dec, 1, 1941
Calendar year
Venezuela
Callon
326,439,310
630,097,196
Callon
255,507,457
94,662,490
Callon
(import quota
filled)
150,868,343
Callon
(import quota
filled)
1,500,000
Callon
665,653
Colombia
Other countries
Calendar year
C
“
>
< f§
'3,082,574,771
Motherlands
Molasses and sugar
sirups containing
soluble nonsugar
solids equal to
more than 6% of
total soluble
solids
CD
fi
O
Piece nlates
500
S3
Paws, head, or other
sepera.ted narts
TREASURY DEPARTMENT
Washington
POR RELEASE, MORNING NEWSPAPERS,,
friday, September 11» 1942____ .
9/10/42
Ï5x~
The Secretary of the Treasury, by this nubile notice, invites tenders
for S ¿no.ooo.ooo
. or thereabouts, of
on a di scount^basi s under competitive bidding.
be dated
.Santemberl6, 19A2
t0 *e i8BUBd
The bills of this series will
and will mature ---- Dec^
r
^
1942,----
n
•n ■ u 4- •iri+p'rpc;t
Thov will "be issued in
when the face amount will be payable withou. inter. .
. i•
-p ftn nno
000 $10.000, $100,000,
bearer form only, and in denominations of *1,000, h.o .OOO, w ,
.
$500,000, and ¥1,000,000 (maturity value).
be received at EedenJ. Reserve Banks and Branches up to the
closing hour, two o'clock p. m., Eastern » * * * 1 time, t o ^ e g e r l U m n .
Tenders will not be received at the Treasury Department, Washington.
Each tender
must be for an even multiple of ¥1,000, and the price offered must be expressed
on the basis of 100, with not more than three decimals, e. g., 99.925.
may not he used.
Eractions
It is urged that tenders he nade on the pointed forms and for
warded in the special envelopes which will he supplied hy Federal Reserve Barks
or Branches on application therefor.
•4-vi^-n+ ^p-nnent
hanks and
Tenders will he received without
deposit from
irom incorporated
n
trust companies and from responsible and recognised dealers in investment securi
ties.
Tenders from others must be accompanied by payment of 10 percent of the
....
fnT unless the tenders are accompanied by
face amount of Treasury bills applied for, uni
an exoress guaranty of payment by an incorporated bank or trust company.
immediately after the closing hour, tenders will be opened at the federal
s 3 -y
ò
-
2
-
Reserve Ranks and Branches,,following which public announcement will be made
by the Secretary of the Treasury of the amount and price range of accepted
bids.
Those submitting tenders will be advised of the acceptance or rejec
tion thereof.
The Secretary of the Treasury expressly reserves the right
to accept or reject any or all tenders, in whole or in part, and his action
in any such respect shall be final.
Payment of accepted tenders at the
prices offered must be made or completed at the Federal Reserve Bank in
cash or other immediately available funds on
September^l6^
----- •
The income derived from Treasury bills, whether interest or gain
from the sale or other disposition of the bills, shall not have any exemption,
as such, and loss from the sale or other disposition of Treasury bills shall
not have any special treatment, as such, under Federal tax Acts now or here
after enacted.
The bills shall be subject to estate, inheritance, gift, or
other excise taxes, whether Federal or State, but shall be exempt from all
taxation now or hereafter imposed on the principal or interest thereof by
any State, or any of the possessions of the United States, or by any local
taxing authority.
For purposes of taxation the amount of discount at which
Treasury bills are originally sold by the United States shall be considered
to be interest.
Under Sections 42 and 11? (a) (l) of the Internal Revenue
Code, as amended by Section 115 of the Revenue Act of 1941, the amount of
discount at which bills issued hereunder are sold shall not be considered
to accrue until such bills shall be sold, redeemed or otherwise disposed
of, and such bills are excluded from consideration as capital assets.
Accordingly, the owner of Treasury bills (other than life insurance com
panies) issued hereunder need include in his income tax return only the
difference between the price paid for such bills, whether on original
- 3 -
issue or on subsequent purchase, and the amount actually received either
upon sale or redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss.
Treasury Department Circular No* 418, as amended, and this
notice, prescribe the terms of the Treasury bills and govern the condi
tions of their issue*
Copies of the circular may be obtained from any
Federal Heserve Bank or Branch*
TREASURY DEPARTMENT
Washington
POR RELEASE, f f l l l f NEWSPAPERS,
Friday, September 11, 1942.
9/10/42
The Secretary of the Treasury, by this public notice,
invites tenders for $ 400,000,000, or thereabouts, of 91 -bay
Treasury bills, to be issued on a discount basis under com
petitive bidding.
The. bills of this series will be dated
September 16, 1942, and will mature December 16, Ij4<-, when
the face-amount will be payable without interest.
They will
be issued in bearer form only, and in denominations of $1 ,000,
$5 ,000, $10 ,000, $100 ,000, $ 500,000, and $1 ,000,000 (maturity
va
alu e ),
Tenders will be received at Federal Reserve Banks and
Branches u p to the closing hour, two o ’clock p. m., Eastern
War time, Monday, September 14, 1942. Tenders will not Joe
received at the Treasury Department, Washington.. nach^tender must be for an even multiple of $1 ,000, and the price of
fered must be expressed on the basis of 100 , with not more
than three decimals, e, g., 99*925* Fractions may not be
.used. It is urged that tenders be made on the printed forms
and forwarded in the special envelopes which will be supplied
by Federal Reserve Banks or Branches on application therefor.
Tenders will be received without deposit from incorpor
ated banks and trust companies and from responsible and recog
nized dealers in investment securities
Tenders from others
must be accompanied by payment of 10 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorpor
ated bank or trust company.
Immediately after the closing hour, tenders will be^
opened at the Federal Reserve Banks and Branches, following
which public announcement will be made by the Secretary of
the Treasury of the amount and price range of accepted bids.
Those submitting tenders will be advised of the acceptance or
rejection thereof. The Secretary of the Treasury expressly^
reserves the right to accept or reject any or all tenders, in
33-20
(Over)
2
whole or in part, and his action in any such respect shall be
final. Payment'of accepted tenders at the prices offered must
be made or completed at the Federal Reserve Bank in cash or
other immediately available funds on September 16, 1942.
The income derived from Treasury bills', whether interest
or gain from the sale or other disposition of the bills, shall
not have any exemption, as such, and loss from the, sale or
other disposition of Treasury bills shall not have any special
treatment, as such, under Federal .tax Acts now or .hereafter
enacted. The bills shall be subject to estate, inheritance,
gift, or other excise taxes, whether Federal or State, but
shall be exempt from all taxation now or hereafter imposed on
the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing
authority. For purposes of taxation the amount of discount at
which Treasury bills are originally sold by the United States
shall be considered to be interest. Under Sections 42 and
117 (a) (1) of the Internal Revenue Code, as amended by Sec
tion 115 of the Revenue Act of 1941, the amount of discount at
which bills issued hereunder are sold shall not be considered
to accrue until such bills shall be sold, redeemed or other
wise disposed of, and such bills are excluded from considera
tion as capital assets. Accordingly, 'the owner of Treasury
bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference be
tween the price paid for such bills, whether on original issue
or on subsequent purchase, and the amount actually received
either upon sale or redemption at maturity during the taxable
year for which the return is made,-as ordinary gain or loss.
Treasury Department Circular No. 418, as amended, and this
notice, prescribe the terms of the Treasury bills and govern
the conditions of their-issue. Copies of the circular may be
obtained from any Federal Reserve Bank or Branch.
-oOo-
/
TREASUfftflDEPA RTMENT
Washington
FOR RELEASE, AFTERNOON NEWSPAPERS,
Thursday, September 17, 1942.
_
9/10/42
Press Ser
No. 33-21
Secretary of the Treasury Morgenthau today made public, in
accordance with a provision of the Internal Revenue Code, a list
of individuals receiving from corporations compensation for
personal services in excess of $75,000 for the calendar year 1940
or fiscal years ending in 1941.
Included also were a few supple
mental listings of previously unreported figures for the calendar
year 1939 or fiscal years ending In 1940.
The Secretary of the Treasury is required by Section 148 (f)
of the Code, as amended by Section 407 of the Revenue Act of 1939,
to make public the names of such individuals as were reported by
employing corporations In their income tax returns
The list
compiled shows the amounts paid to officers and employees by re-
other compensation for personal services.
Section 148 (f) of the Internal Revenue Code, as amended by
Section 407 of the Revenue Act of 1939, is as follows:
’’Comoensation of Officers and Employees: — Under
regulations prescribed by the Commissioner with the
approval of the Secretary, every corporation subject
to taxation under this chapter shall,^in Its return,
submit a list of the names of all officers and em
ployees of such corporation and the respective amounts
paid to them during the taxable year of the corporation
by the corporation as salary, commission, bonus, or
'other compensation for personal services rendered, lx
the aggregate amount so paid to the individual is In
excess of $75,000.
2
"The Secretary shall compile from the returns
made a list containing the names of, and the amounts
paid to, each such officer and employee and the
name of the paying corporation and shall make such
list available'to the public. It shall be unlawful
for any person to sell, offer lor sale, or circulate,
for any consideration whatsoever, any copy or reproduction of any list, or part thereof, authorized to
be made public by this Act or by any prior Act re
lating to the publication of information derived
from income tax returns 5 and any offense against
the foregoing provision shall be a misdemeanor and
be punished by a fine not exceeding {¡'¡>1,000 or by
imprisonment not exceeding one year, or both, at
the discretion of the court: Provided, that nothing
In this sentence shall be construed to be applicable
with respect to any newspaper, or other periodical
publication entitled to admission to the mails as
second-class matter."
The names of the corporations and of the officers and
employees who received compensation in excess of $>75,000, as
reported to the Secretary by the Bureau of Internal Revenue,
are as follows:
NAME OF CORPORATION
AMD OFFICERS OR
EMPLOYEES
CALENDAR OR
FISCAL YEAR
ENDED
SALARY
COMMISSION
BONUS
■OTHER .
COMPENSATION . .
-- -1---- :__2
TOTAL
ALABAMA
THE BIRMINGHAM NEWS COMPANY
.Hanson, Victor H.
LIBERTY NATIONAL LIFE INSURANCE CO .
Jordan, R. C,
WATERMAN STEAMSHIP CORPORATION
Nicolson, N. G.
Roberts, E. A.
'
-1
12/31/40
9,000.00
94,200.00
103,200.00
12/31/40
37,119.99
9/30/ui
■
76,000.00
129,000.00
87,119.99
76,000.00
129,000.00
ARIZONA
ARIZONA LUMBER &' TIMBER COMPANY
Gibson, Bruce
12/31/40
178,114.07
178,114.07
CALIFORNIA
BULLOCK’S, INC.
Winnett, P* G,
CHARLES CHAPLIN FILM .CORPORATION
Chaplin, Charles
DESMOND’S
- Hue¿man, Ralph
DOUGLAS AIRCRAFT COMPANY, INC.
Douglas, Donald W.
Douglas, Donald W.
1 /31/1+i
12/31/1w>
7/31/41
11 /30/40
11 /3Q /41
SAMUEL GOLDWYN INC., LTD.
6/30/41
Brennan, Walter
Cooper, Gary
HEARST CONSOLIDATED PUBLICATIONS, INC.12/31/40
Hearst, William Randolph
«.-■
75,000.00
95,000.00
20,000.00
163,000.00
60,000.00
'75,000.00
101,250.00
-
163,000.00
32.422.00
92,422.00
so.09.
519.09
-_75,Q8Q.OO
101,769.09
80,458.34
287,671.00
80,458.34
287,671.00
100,000.00
100,000.00
!+
NAME OP CORPORATION
AND OPPICSRS OR
EMPLOYEES
CALENDAR OR
PISCAL YEAR.
ENDED
Sa La RY
COMMISSION •
BONUS
OTHER
COMPENSa TION
TOTAL
CALIFORNIA (Con» )
HEa RST PUBLICATIONS, INCORPORATED
Barham, Prank P.
.
IDAHO MARYLAND MINES CORPORATION
MacBoyle, Errol
LOS ANGELES TURE CLUB, INC.
Struh, Charles H,
NORTH AMERICAN AVIATION, INC.
Kindelberger, James H.
Kindelberger, James H.
Atwood, John L.
OCCIDENTAL LIRE INSURANCE COMPANY
Leisure, H. M.
FACIEIC GAS AND ELECTRIC COMPANY
Black, James B.
PHIL BERG-BERT ALLENBERG, INC.
Berg, Phil
Allenberg, Bertram
ROSENBERG BROS. & COMPANY
Oppenheimer, Arthur C.
SAFEWAY STORES, INCORPORATED
Warren, L. A.
DAVID 0; SELZNICK PRODUCTIONS, INC.
Selznick, David 0.
Hitchcock, Alfred
OÔ -ÖOO *.OOT
12/31/1*0
80,000.00-
80,000.00
12/31/40
12,000.00
25,937.50
97,937.50
6/30/1*1
12,000.00
116,073.1*7
1*1 ,000.00
125,000.00
128,073.^7
12/31/1*0
350.00
166,350.00
9/30/1*1
12/31/1*0
12/31/1*0
12/31/1*0
12/31/U0
1*5 ,000.00
75,000.00 .
150.00
120,150.00.
23.333.33
55,000.00
200.00
78,533-33
188,391*.87
188,391*. 87
75,000.00
1 ,210.00 '
136,812.50
99.500.00 •
5/31/1*!
12/31/1*0
10/31/1+1
76,210.00
136,812.50
99.500.00-
25,000.00
90,3^2.75
115,31*2.75-
60,000.00 •
59 »666. 30
119,666.3b
182,000.00
157,375.00
** •
182,000.00
157,375.00
1
NAME OF CORPORATION
AND OFFICERS OR
EMPLOYEES_____
CALENDAR OR
FISCAL YEAR
ENDED
SALARY
COMMISSION
BONUS
OTHER
COMPENSATION
TOTAL
CALIFORNIA (Con.)
STARLIGHT, INC.
9/30/^1
La Cava, Gregory
'Salary accrued during period ended
September 30, 19Ul, bufc^ Ly pro
visions of contract dated November 2,
I9U0, payable only at ra te of.
$2,000.00 per week.
Wa l t e r w a n g e r p r o d u c t i o n s , i n c o r p o r a t e d 6/30/41
Wanger, Walter F. .
WELLS FARGO BANK & UNION TRUST CO,
12/31/UO
Lipman, F, L*
131,250.00
131,250.00
130,000.00
130,000.00
50,000.00
26,833.33
6U,500.00
lo g . 3 3 3 .56
2 5 , 7 5 0 .0 0
76,233*33
' CONNECTICUT
AUTO—ORDNANCE CORPORa TION
Hoover, Lawrence E, de S.
Maguire, Russell
J. L. LUCAS & SON, INC.
Lucas, Frank B.
lO/31/Ul
12/31/^0
"
9 0 ,2 5 0 .0 0
1 0 8 ,333*56
8 0 , 8 2 0 .0 0
8 0 , 8 2 0 .0 0
DELA viARE
AMERICAN SUPPLIERS, INCORPORATED
Lipscomb, J. E., Jr.
BENEFICIAL MANAGEMENT CORPORATION
Watts, Charles R.
THE COCA-COLA COMPa NY
Woodruff, R. W.
Acklin, A. a .
1 Sibley, J . A.
0 0 •ö/iT * JL ÖT
A n *n o o -
T
12/31/^0
I2/31/UO
12/31/UO
100,000.00 •
lOO.OOO.ÇO
.
I
105,170*00
8 2 0 .0 0
105,990.00
102,333.3U
87,000.00
87,000.00
U50.00
U00.00
U50.00
1 0 8 , 7 2 3 *3 ^
p s a jx r
■aiooo-^O'^-S.K
“ O -PTä b c L
OO-Sit‘
00 "OOO*2
87.U00.00
87.U50.00
3 1
Tti/xi/ OT
•OKI
* RN.OXCLOn.CtOHIÆ X O I S Z T E S
»V-
-r r
*0
<XXA.^CX
* TIO-I-XT3 W
,
HAMS QI CORPORATION '
CALENDAR OE
~ ---------- Q ¡m m —
AND OFFICERS OR
FISCAL'TEAR
SALARY
COMISSIONBONUS
COMPENEMPLOYEES__________________ ENDED __________________________ __ ________
SAT ION
6
TOTAL
DELAWARE (Con.)
COLUMBIA GAS & ELECTRIC CORPORATION 12/31/40
Gossler, Philip G«
E. I. du PONT de NEMOURS & COMPANY
I2/3I/UO
Bolton, Elmer K,
Brown, J. Thompson
Carpenter, Walter S., Jr.
Crane, Jasper E.
du Pont, Laramot
Echols, Angus B.
Eliason, James B.
Purst, Edward W.
Harrington, Willis F*
McCoy, John W.
Richter, William
Robinson, Edmund G.
Rykenboer, Edward A*
Stine* Charles M. A.
Wardenburg, Frederic A.
Yancey, Edward B,
Yerkes, Leonard A#
HERCULES POWDER COMPANY
IZ fc l/k O
Dunham, R. H.
Higgins, C. a »
VICE CHEMICAL COMPANY
6/30/41
Preyer,.W, Y«,
Richardson, H. S.
90.000.
00
33.000.
^5,333.35
112,500.00
^5,333.35
91,666.69
50,166.65
33,375.00
39,204.00
^5,333.35
^5.333.35
'42,900.00
42,900.00
32,400.00
^5,333.35
33,600.00
37,000.00
49,500.00
00
51 ,750.00
66,250.00
93,750.00
66,250.00
66,250.00
43,500.00
46,500.00
70,650.00
70,650.00
50,750.00
65,500.00
52,500.00
66,250.00
53,500.00
50,250.00
65,500.00
50,000.00
50,000.00
52,000.00
36,000.00
90,000.00
240.00
220.00
180.00
200.00
240.00
i4o. 00
220.00
240.00
200.00
240.00
240.00
220.00
220.00
220.00
35,SOG. 00
32,700.00
.
48,750.00
39,000.00
84.750.00
111.823.35
206.470.00
111.763.35
91,866.69
116,656.65
77.015.00
85.704.00
116.203.35
116.223.35
93.550.00
108.640.00
84.900.00
111 .823.35
87.320.00
87.470.00
115.220.00
85.800.00
88,700.00
560.00*
5IO.OO
101,310.00
75¿510.00
2
CALENDAR OR
FISCAL YEAR
SIDED
máme of corporation
AND OFFICERS OR
EMPLOYEES_____
SALARY
COMMISSION
BONUS
OTHER
COMPENTOTAL
SATION _____________
ILLINOIS
BLACKETT-SAMPLE-HUMMERT, INC* Sample, J. G*
Blackett, Kill
Hummert, S. F.
Hummert, A. S,
b o r g -Wa r n e r ., c o r p o r a t i o n
Vi Davis, C. 3.
Ingerso11, R. C.
• Gamble, D. E,
BRINK'S, INCORPORATED
. Allen, Frank
Allen, John D*
THE GEL0TEX CORPORATION
Dahlberg, Bror
CHICAGO R0T0PRINT COMPANY
Geiger, Alfred B.
CONTINENTAL ILLINOIS NATIONAL BANK
AND TRUST COMPa NY OF CHICAGO,
•Cummings, Walter J,
.CRANE -CO*
Nolte, C. B.
.
.
R*. R* DONNELLEY & ‘SONS COMPa NY .
Donnelley, Thomas E.
. -Littell, C. G,
. ^Zimmerman, H. P.
Fa i r b a n k s , m o r s e & c o m p a n y
.Mörse, Robert H, *
GREAT LAKES CARBON CORPORATION
S&akel, George
2/28/41
130,000.00
130,000.00
60.000.-oo
72,523.62
70,505.55
12/31/40
9 ,6 4 0 . 4 9
14.500.00
31,613,91
2 4 . 2 5 0 .0 0
75.000. 00
51.0 0 0. 00
51.0 0 0. 00
12/31/40'
84,999* 84
git, 999.8V
lO/31/^l
3/3i/i+l
12/31/^0
35,000.00
157,8 7492
15,000.00
68,026.37
* 85,269,84
85,269.84
900.00
193.774 98
83,026.37
150,700,00
80,000.00
700 .-00
80,700.00
4,244*40
60,309. SS
1 1 9 .5 2 4 .7 0
7 1 , 7 1 4 .8 2
60,000.00
60,000.00
75,000.00
4 0 ,0 0 0 .0 0
21,222.00
26,200.00
10/31/^1
270*00
270.00
700.00
12/31/40
8 1 , 5 3 4 S8
145,724.70
■ 75.959.22
—
* o t S * S/
0 0 * ó í£ " * x o x
0 0 'OtS
00 *096
O O *000 *
OO *O S Z * 3+7
OO *OOO*35
nC
120,700.00
700.0Ò
115,000.00
•s
00-000‘gC
0 0
00
00
90,050.00
S3 ,919.91
7 5 . 5 5 5 .-po
550.00
1,300,00
305.00 ■
150,000.00
12/31/40
i2 l3 i¡b o
130.000.
130.000.
132', 523.62
8 0 ,1 4 6 ,0 4
- ji
- m
s ' * Jte Ä S C ta
CALENDAR OR
FISCAL YEAR
ENDED
NAME OE CORPORATION
AND OFFICERS OR
EMPLOYEES
SALARY
COMMISSION
OTHER
COMPEN
SATION
BONUS
TOTAL
ILLINOIS (Con.)
HALES & HUNTER COMPANY
Woolman, C. S.
HARRISON WHOLESALE COMPANY
Arenberg, A. L*
HILLMAN’S, INC.
Loeb, Herbert A.
HOUSEHOLD FINANCE CORPORATION
Henderson, B. E,
INDEPENDENT-PNEUMATIC TOOL'CO.
. Hurley, Neil' C,, Sr.*
THE INGERSOLL MILLING MACHINE CO.
Perry, R. S,
INTERNATIONAL HARVESTER COMPANY
. McAllister, S. G*
McAllister, S. G.
12/31/^0
1/3l/4l
•
12/31/^0
12/31/^0
11/30/^1
.25,000.00
75.000.
00
1 0 0 ,0 0 0 .0 0
7 5 ,0 0 0 .0 0
50.000.
00
.125,000.00
_25,000.0s
12/31/^0
12/31/^0
S7#^99oS6
1,900,00
99.399.96
100,000.00
121,710.00
61,458.35
20,000.00 1,710.00
30,730.00 1,070.06
50,000.00
45,102.63 ' 250.00,
95.352.63
96.000.
96.000.
93,25S.35
96,000.00
,96,000.00
00
00
49,937.34
34,500.00
I2/31/UO
* o o p •05?
76,052.21
58,052.21
.10,000.00
s4.437.34
100.096.75
106.446.76
6+7
0 0
85,660.08
60,660.00
10/3Q/^Q
10/31/^1
295,300.3s
■84,066.20
12/31/^0
10/31/41
12/31/^0
McCormick, Fowler
JEWEL TEA COMPANY » INC.
Karker, M. H.
LADY ESTHER, LTD.
.Busiel, Syma
Busiel, Alfred
LINK-BELT COMPANY
Kauffmann, A.
LORD & THOMAS, INC.
Francisco, Don
■Coons, Sheldon R.
285,280.38
10,020.00
0 0
- 00c
0+ 7/ xs:/ ;
hame of corporation
and officers o r
EMPLOYEES
CALENDAR OR
FISCAL YEAR
ENDED
COMMISSION
SALARY
BONUS
__________
OTHER
COMFENTOTAL
SaTION_____ __
ILLINOIS (Con.)
Ma RS INCORPORATED
Mars, Mrs. E. V.'
MIAMI CORPORATION
Erminger, H. B., Jr.
W.H. MINER, INC.
Withall, A. P*
MONTGOMERY WARD & CO., INC.
Avery, S. L.
NEEDHAM, LOUIS AND BRORBY, INC.
Louis, J. J.
NORTHWEST ENGINEERING COMPANY
Houston, L. E.
THE PEPSODENT CO.
Smith, Kenneth G.
SEARS, ROEBUCK AND CO.
Carney, Thomas J.
J. p, SEEBURG CORPORATION
Seeburg, J. P*
Seeburg, N. M.
A. E. STALEY MANUFACTURING COMPANY
Staley, Augustus E.
STANDARD OIL COMPANY (INDIa NA)
Seubert, Edward G.
STANDARD RAILWAY EQUIPMENT COMPANY
Arnold, D» R.
Frank, A. A.
Helwig, Ac A.
TRIBUNE COMPANY
..
Macfarlane, W* E.
Rose, L. H.
UNITED DRILL a ND TOOL CORPORATION
Kearins, M. J.
12/31/1+0
12/31/1+0
12/31/1+0
1 /31^1
1 2 0 ,0 0 0 .0 0
120,000.00
1+50.00
75.000. 00
75,1+50*00
100,1+62.51
50.000. 00 50,1+62.51
1+50.00
1 0 0 , 0 0 0 .0 0
100,1+50.00
12/31/1+0
79.1+53-75
12/31/1+0
100.000. 00
50,000,00
50,000.00
12/31/1+0
‘135 »017.1+6
135,017.^
1 /31/1+1
9/30/iu
12/31/UO
12/31/1+0
12/31/1+0
75.000. 00
12,500.00
27,500.00
50.000. 00
50.000. 00
i+5.555.!+i+'
95.555-l+l+
87.19^99
36.000.
6.7.235.8l+
37.19^.90
00
103,235-81+
1 1 0 .0 0 0 .
110,000.00
100,0JO.00
160.000. 00
60,000.00
1+0,000.00
60.000. 00
1+0,000,00
00
100 ,0 0 0 .0 0
60,000.00
100.000. 00
12/31/1+0
91+,1+06.1+9
117 .901+.59
12/31/1+0
87.352.67
62,352.63
2*+,99.9.81+
xxo ct
/Tf
/2t
•o o o \ 0"^"® •
*-v
S
L
*013.X * S'WXOXUu =» ccaox
%
NAME 01 CORPORATION
; ; a N D OEEICBRS OR
EMPLOYEES.
calendar or
EISÇAL -YEAR
ENDED
SALARY
.. ^
... . . ... ..... ....... ........... ......... 10
OTHER
COMMISSION
BONUS
, C0MPENTOTAL
___________________________’ SATIQ.N--
INDIANA
SERVEL, INC.
.Rutbenburg, Louis
•.
60,QOO.OO
27,500.00
-88,700.00
1,200.00
. ./ KENTUCKY .
ERANKEORT DISTILLERIES, INC.
Jones, Lawrence
Brownlee, James E,
•>
IO/31/UI
6/30/Hx.
95,000.00
125,000.00
.
V
M
-.95 »000.00
,125,000.00
.LOUISIANA
THE SOUTHERN COTTON OIL COMPANY
Petersen, A. Q»
8/3O/J+I
50,000.00
25,000.00
1 ,305*00
I'
. . .76,305*00
' •* •* 1•* \
MARYLAND
ACACIÂ MUTUAL LIEE INSURANCE CO.
.Montgomery, William
. ' .
THE BALTIMORE SALESBOOK COMPANY
Speer, Talbot T.
COMMERCIAL CREDIT COMPANY ,
Duncan, A. E.
•CONSOLIDATED GAS ELECTRIC LIGHT a ND
POWER COMPANY OE BALTIMORE
W^ner, Herbert A.
•
CROWN. CORE & SEa L COMPa NY, INC.*
McManus, Charles E.
,
12/31/40
12/31/^0
75.000.00
39,350.00
200.00
. 75,200*00
•
*'
.. .: 75,350.00
n
36^.000.00
12/31/40
85,000.08
12/31/40
¿5,000.08
75,000.00
3^0.91
. 75.340.91
100,000.00
200.00
,100,200.00
12/31/40
11
KAKE 01 CORPORATION
AND OFFICERS OR
f>V EMPLOYEES_____________
CALENDAR OR
FISCAL YEAR
ENDED
OTHER
COMMISSION
BONUS
COMPEN_____________ .
. .- ,........ ....SATION_
TOTAL
"t SALARY
MARYLAND (Con,)
THE HECHT COMPANY
Dulcan, C. B . , Sr.
RUSTLESS IRON AND STEEL CORPORATION
Turtle, C. E.
l/3l/Ul
12/31/UO
67.30U.7g
50,000.00
Uo.ooo.oo
li7 .30U. 7S
U5-,0OO.OO
• 85,000.00
17 ,579.00
29,350.si
17 ,579.00
107,579.00
161,350,81
•" -107,579*00
MASSACHUSETTS
DRAPER & COMPANY, INC,
Dana, Robert W,
Draper, Paul A.
Green, Malcolm
DRAPER TOP COMPANY
Cuneo, Everett L.
Draper, James B.
.
Draper, Joseph ?*
Thurmond, George M.
VM. FILENE»S SONS COMPANY
Frost-» Edward J.
Kirstein, Louis B.
'/
HUNT-SPILLER MFG. CORPORATION
Eilet, Victor W.
THE IIAHEY CLINIC
‘Lahey, Dr. Frank H.
Lahey, Dr . Frank H.
LEVER BROTHERS COMPANY
Countyray, F. ¿U
11 /30/U1
18,000,00
11 /30/U1
i/31/ul
OO * 0 0 3
75,500.00
2U.500.00
2U.500.00
2U.500.00
2U.500.00
-
75,500.00
75,500.00
75,500.00
Ho,000.00
80,000.oo
100,000,00
100,000.00
100,000.00
• 100,000.00
»
-
80,000.00
-80,000.00
12/31/U0
S5,U77.S7
S5,U77,S7
12/31/39
12/31/U0
6/30/U1
82,500.00
82,500.00
82,500.00
82,500.00
*?
30,000.00
OO* OOO* OOt
OO •OOS’ 'O O T
72,000.00
102,000.00
72,006.00
18,000,00
30,000.00
0 0 “ooo * S i
U08.778.70
ott/x£ /sx
t —•
-oiscx •
•U 38.77s.70
1
«1© x
rsnarnwT .T
,rTv'C
T
T ^ s
• ©Tixrs'i^o^
°S* HH:00 ' K.ROtLO
^ a© q .a o H
»ao-uS^ajiv
jro jLK^rdcv^oo >333.^0^
12
NAME OE CORPORATION
AND OFFICERS OR
EMPLOYEES
CALENDAR OR
FISCAL YEAR
ENDED
SALARY
COMMISSION
BONUS
OTHER
COMPEN
SATION
TOTAL
MASSACHUSETTS (Con.)
PEPPERELL MANUFACTURING COMPANY
Leonard, Russell H.
UNITED SHOE MACHINERY CORPORATION
Winslow, Sidney W., Jr,
U. S. BRANCH OF THE EMPLOYERS1
LIABILITY ASSURANCE CORPORATION,
LIMITED
Stone, Edward C.
Palmer, Sydney H*
6/30/41
60,000.00
100,000.00
40,000.00
2/28/41
90,000*00
90,000.00
12/31/40
161,322.42
42,429.43
81,000.00
40,000.08
242,322.42
82,429.51
MICHIGAN
EX-CEÏiL-0 CORPORATION
Huher, Phil
LEE ANDERSON ADVERTISING COMPANY
Anderson, Lee
BOHN ALUMINUM & BR a SS CORPORATION
Bohn, Chas. B.
Mar key, P. A*
BURROUGHS ADDING MACHINE COMPANY
Backus, Standisti
Doughty, A. J.
CHRYSLER CORPORATION
Chrysler, W. P,
Keller, K. T.
Hutchinson, B. E.
Zeder, Fred M.
11/30/41
24,000.00
111 ,027.45
135.227.^5
36,000.00
53,000.00
89,000.00
12/31/40
12/31/40
40.000.
20.000.
00
00
86.763.05
86.763.05
100.00
126.843.05
106.863.05
150.00
150.00
85.150.00
80.150.00
80.00
12/31/40
85*000.00
80,000.00
12/31/40
125,758.00
100,000.00
90.000.
85.000.
00
00
700.00
800.00
25O.OO
125.75S.00
100,700*00
90,800.00
85,250.00
Ü K g OP CORPORATION
Ai® OPPICERS OR
EMPLOYEES •
calendar or
PISCa L YEAR
.
SALARY
ENDED
other-
COMMISSION
_________ ,
SOSOS
______________
COINERSAT ION
’
■■TOTAL
.....
MX CHIPAIT (Cou. )
THE DETROIT EDI SOIT COMPARI
Dow, Alex
PORD MOTOR COMPARI
Pord, Edsel B.
Martin» P. B,
Sorensen, C. E.
Craig, B. J.
Wibel, A* M.
GENERAL MOTORS CORPORATIÒR
Archer, Thomas ÏV
Biechler, Elmer G,
Bradley, Albert
Breech, Ernest R."
Brown, Donaldson Coyle, Marvin E.
Crawford, James M*
.Curtice, Harlow &
Dreystadt, Nicholas
Earl, Harley J.
Evans, Ronald K 0
Pisher, Alfred J.
Bisher, Edward B.
Pisher, Lawrence P.
Pisher, William A 0
Grant, Richard H.
Howard, Graeme K.
Hunt, Ormond E.
12/31/240
12/31/1+0
56O.OO
S8,000.00
' 1I+1+,619.61+
• 178,258.91+
177,0014.91+
109,1+66.36
82,951.06
11+14/619.6**
178,258.91+
177,00^.914
109.U66.36
82,951.06
12/31/1+0
u
1+0,000.00
50,*000.00
100,000.00
31+/166.60
100,000.00
100,000.00 '
36.000.
75.000.
1+5 ,000.00
59,166.^66
50.000.
75.000.
75.000.
75.000.
75,000.00 ;
75,000.00
1+5,000.00
85,080.62
88,560.00
550.00
500.00
350.00
00
00 150.00
00
00
00
00 1+50.00
150.00
1+00.00
350.00
l+i,.l+2l+.00
1+2,096.00
132,760.00
1+1+»1+1+8.00
132,816.00
106,320.00
51 ,696.00
87,888.00
39,120.00
1+2,621+.00
62,256.00
31,008.00
85,1+88.00
108,ll+l+. 00
19,200.00
110,688.00
1+5,1+08.00
113,280.00
86,281175
1+.857.-75
96,839.00
14,71+3.00
21+8,680.25
15,362.25
83,596.10
14,981.50
15,366.00 ' 2I+8»682. 00
12,1453.75
219,123.75
93,669.00
5.973.00
173,01+6.00
10,008.00
88,1+1+3.00
l+,323.00 *
106,792.1+1
5 .OOI.75
119,087.75.
6,831.75
3.559.50 -i09', 567+50
9,820.50 • 170,308.50
196,398.00
12,80l+.00
•96,630.75
2,280.75
198,892;00'
12,801+; 00
95.ss5.25
5.^77.25
211,51!+.'62
12,80l+.00
'NAME OE CORPORATION.....
CALENDAR OH
* '-AND OEEICERS OH
EISCAL YEAR
______ EPLOYEES
_______________ ENDED
Ik
SALARY
COMMISSION
BONUS
OTHER
COMPEN*
SATION
TOTAL
MICHIGAN (Con.)
GENERAL MOTORS CORPORATION (Con.)
Kettering, Charles E.
Klinger, Harry J.
Knudsen, William S.
Kroeger, Erederick C.
Kunkle, Bayard D.
McCuen, Charles L.
Mooney, James E.
Prentis, Meyer L.
Sloan, Alfred P. Jr.
....
Smith, John T.
,
Tanner, Eloyd 0. .
Wetherald, Charles E.
Wilson, Charles E.
GENERAL MOTORS SALES CORPORATION
Holler, William E.
GIBSON REERIGERa TOR COMPANY
Gibson, C. J.
GRSAÎD LAOS STEEL. CORPORATION
Eihk, George R.
THE- J, L.-HUDSON COMPANY
Webber, J. 3. . ,
Webber, Oscar
Webber', R. H*
S.. S,. KRES&E COMPANY
Williams, R. R.
Tuttle, C. B.
'
12/31/^0
12/3l/bO
100 I 000.00
60.000. 00
62*500.00
38,o6toto
39¿^62.32
62,016.10
75,‘OOo*oo
35.000. 00
200,^000.00
100,*000.*00
36.000.00
to, 999.92100,0 0 0 .0 0
150.00
250.00
- too. 00
500.00
550.00
600*00
60,000.00
133.3to.00 15,too. 00 ^
53.856.00 5 .926.50
13^,592.00 21,713.25'...
to.760.00
5.703.75
62.256.00 6.831.75
50,6to. 00 5.301.75
loto t o o . 00 12,soto 00
to,6to.00
5.232.75
132.768.00 15.362.25
to,22to00
5,013.0c'
61.392.00 7 .069.50
ito, 5to. 00 15.362.25
65,664.00
7/31M
I2/3I/UO
7.572.75.
100 ,0 00.00
62,500.00
60,000.00
133,236.75
122,500.00
4
ris*
12/31/lK)
. V
i08,550.07
117 ,957.85
i92,6otooo
8^,872.75
200.500.00
2to ,.680.25
81.237.00
118,tol.to
256,506.25
100,000,00
l/31/^l
V
2to,9to.oo
119,782.50
219,055.25
91,528.2^
89.250.00
89.250.00
•'
9 r .I to .6 6
l62i2to ,66
Ii7,to8.33
8.9.250.00
89.250.00
15
NAME OF CORPORATION
and officers or
___ EMPLOYES
CALENDAR OR
FISCAL YEAR
ENDED
SALARY
COMMISSION
• BONUS
OTHER
COMPEN
SATION
TOTAL
MICHIGAN (Con.)
METAL MOULDINGS CORPORATION
Chamberlin, C. P.
NASH-KELVINATOH CORPORATION
Armstrong, W. F.
Mason, George W,
Pierce,- E... R*.
NATIONAL BANK OF DETROIT
McLucas, Walter S,
NATIONAL ELECTRIC WELDING MACHINES
.COMPANY
• Brueckner, Julius R.
PACKARD MOTOR CAR COMPANY
Gilman, M. M.
RINSHED-MASON COMPANY
Ellis, Robert
SENIOR INVESTMENT CORPORATION
Fisher, Fred J.
UNIVERSAL CREDIT CORPORATION
Kanzler, Ernest
N. A. WOODWORTH COMPANY
•Woodworth, N. A*
.YELLOW TRUCK & COa CK MANUFACTURING
COMPANY
.
Bahcock, Irving B..
12/31/to
24.000.
9/30/41
50,000.00
100,000.00
25,000.00
74,999.99
125,000.07
82,144.97
12/31/40
50.000.
10/31/41
• 97,215.32
00
73.2x5.s2
209.00
107.-H+1+.97
37.375.00
00
12/31/40
75.27O.OO
75,270.00
167,836.69
167,836,69
12/31/40
144,000,00
144,000.00
12/31/40
h
/30/41
90,000.00
90.000.
00
11 .000.
00,51!+.75
59
12/31/40
1.43,667.64
73.152.89
59.048.56
50,179.92
OO *0?5c? *
O O "O S3 * 6 0
37,375.00
81,134.08
81,134.08
12/31/40
12!+.999.99
225,209.07
on/tC/ST:
109,228.48
-
-...
NAME Off CORPORATION
AND OFFICERS OR
EMPLOYEES
16
CALENDAR OR
FISCAL YEAR
ENDED
salary
COMISSION
BONUS
.' OTHER .
. COMPEN-,
SATION
...TOTAL
MINNESOTA
AMERICAN HOIST & DERRICK COMPANY
Crosby, Frederic
Daviè, Harold W.
GENERAL MILLS, INC.
Davis, D. D.
NORTHERN PUMP COMPANY
'
Hawley, John B.fJr.
* •'' 4 MISSOURI
11 /30/1*1
30,000.00
6,330.00
63,300.00
S3.300.00
128,681,67
122,351.67
5/31/41
80,000.00
.
80,000..00
. 6/30/41
72,000.00
100,000.00
172,000*00
75*000.00
35,000,00
110,000.00
io,000.00
10,000.00
75.006.25
75,006.25
85,006.25
‘‘
ANHEUSER-BUSCH, INC.
Busch, Adolphus, III
CURIES CLOTHING COMPANY
Curlee, S. H . , Sr.
Curlee, .S, H . , Jr.
D !ARCY “ADVERTISING COMPANY
Ia661 A« Xi»
JAMES R. KEARNEY CORPORATION
Kearney, James R., Sr.
LAV/TON-BYRNE-BEUNER INSURANCE
AGENCY COMPANY
Lawton., Carl S.
LIGGETT & MYERS TOBACCO COMPANY
Andrews, J. ¥.
Carmichael, W. D.
Carroll, Ben
Few, B. F.
Thurston, E. H.
Whitaker, G. W.
12/31/1*0.
11 /30/1*1
12/31/1*0
12/31/1*0
149,s 47. 00
12/31/1*0
-ii*9,8i*7.-oo
75*000.00
12/31/1*0 ,
11 ,1*1*5.62
123,689.23
35*OQQ. 00
25,000.00
25,000.00
25,000.00
25,000.00
25,000.00
85,006.25
86,1*1*5.62
.■. 1
123,629.23
n
53,363.76
53,363.76
53.363.76
53.363.76
53,363.76
53.363.76
88,363.76
78,363.76
78,363.76
78,363.76
78,363.76
78,363.76
11
NAME OF CORPORATION
AND OFFICERS OR
EMPLOYEES
CALENDAR OR
PISCAL y e a r
ENDED
. SALARY
COMMISSION
BONUS
TOTAL
■- A
MISSOURI (Con,)
MAY DEPARTMENT STORES COMPANY
May, Morton, J.
Dauby, Nathan, L.
THE PULITZER PUBLISHING COMPANY
Pulitzer, Joseph
OTHER
"COMPEN
SATION
l/jL/41
100.00
100,000.04
100,100.04
131^252.26
131,252.26
12/31/1«
100,000.00
145,228.23
45,228.23
NEBRASKA
J. L. BRANDEIS & SONS
Brandéis, George
1 /31/U1
50,000.00
27.637.53
.
77,637.53
NEW JERSEY
ATLAS CORPORATION
O&lu®, Floyd B,
P. BALLANTINE & SONS
Badenhausen, Carl W.
Badenhausen, Otto A,
DENGUE,- INC,
Seltzer, Theodore
BESSEMER INVESTMENT COMPANY
Layman, David T., Jr.
BRISTOL MYERS COMPANY
Bristol, Henry P.
CAMPBELL SOUP COMPANY
Dorrance, Arthur C.
COLGa TE-Pa LMOL Iv e -p e e t c o m p a n y
Little, E. H.
12/31/Í40
f > ■:
3/31/iti
40,000.00
3s.000.00
12/3l /**0
75,000.00
75,000.00
, 1001000*00
•••1
115,000.00
113,000.00
1 ,000.00
138.767.9s
36,137.15
8.0,009.00
1;.■ -./"•
.76,137.23
31,463.60
93,000.00
« r •• k
131,463.68
100,000.00
12,000.00
125,767.92
12/31/40
80,000.00
12/31/40
40,000.08
7/31/4l
93,000.00
12/31/40
100,000.08
NAME OP CORPORATION
AND OPPICERS OS
_______ EMPLOYEES
CALENDAR OR
PISCAL YEAR
ENDED
SALARY
____________________ ___________________
18
OTHER
COMMISSION
BONUS
COMpENTOTAL
______ t________ _
SAT ION
NSW JERSEY (Con.)
CONGOLEUM-NAIHN, INC.
Hawkes, Albert V.
PORSTMANN WOOLEN CO.
Porstmann, Curt E.
HARMON COLOR WORKS, INC.
Chartrand, Victor J.
HELLER BROTHERS COMPANY
Heller, Paul E.
HOPPMaNN-LA ROCHE, INC.
Bob st., E. H.
INTERNATIONAL CIGAR MACHINERY CO.
Patterson, R. L.
THE PRUDENTIAL INSURANCE COMPANY
OP AMERICA
D ’Olier, Pranklin
THE SINGER MANUPACTURING COMPANY
Alexander, Sir Douglas, Baronet
UNITED STATES PIPE AND POUNDRY CO.
Russell, N. P. S.
12/31/40
80,000. 00
80,000.00
11/30/41
25,000.00
61,742.23
200.00
12/31/40
17 ,100.00
7/31/41
63.923.55
72,000.00
86,942.23
31,023.55
14,032.20
86,032.20
12/31/40
117 ,000.00
1?17 ,OOO.4.OO
12/31/40
153.189.49
153.189.49
12/31/40
100,000.00
100,000.00
12/31/40
100,000.00
50,000.00
60,000.00
31 ,885.00
100.00
91,985.00
65,000.00
47,000.00
520.00
112,520.00
150,000.00
12/31/40
NEW YORK
AIR REDUCTION COMPANY, INC.
Adams, C. E.
ALLIED CHEMICAL & DYE CORPORATION
Atherton, H. P.
ALLIED STORES CORPORATION
Puckett, B. Earl
12/31/40
12/31/40
125,000.00
125,000.00
1/31/41
30,000.00
35,655.31
115,655.31
12
CALENDAR OR
'
.EISCAL YEAR
SALARY
COMMISSION
BONUS
ENDED
______ _
_______________________
hams os corporation
and oesicers or
EMPLOYEES____
‘
OTHER' .
COMPENTOTAL
SATIQN ______ -
NEW YORK (Con.)
B. ALTMAN AND COMPANY
Bui;kef John S.
AMERICAN CAN COMPANY
. Phelps, Henry-W.
Baker, Herbert A.
AMERICAN CYANAMID & CHEMICAL CQKP*
Derby, H. L.
AMERICAN ELANGE & MSG. CO. ,: INC*
Parish, R. L.
Parish, R. L.
.
,
AMERICAN LOCOMOTIVE COMPANY
DiQkeriaan, W. C.
AMERICAN SMELTING AND REFINING CO.
Brownell» Srancis H.
. Guess, H. A.
AMERICAN TELEPHONE & TELEGRAPH CO.
Giiford, W. S.
Cooper, C. P.
Bracelen, C. M.
THE AMERICAN TOBACCO COMPANY
Hahn, Paul M.
. Hill, George W.
. Hill, George W..,, Jr.
Neiley, Charl.es S.
Riggio, Vincent
AMERICAN Na TEEWORKS AND ELECTRIC
. COMPANY, -INCORPORATED
• .’•
Porter».H* Hobart-
T
T
fe - S G S > ~
S rr
O O *000*Ö3T
x£T * S S 9 * S S
l/3l/^l
12/31/4o
22,500.00
75,000.00
.1 ,500.00 ,,151 ,500.00
.1 ,500.00';; 84,000.00
150,000.00
82,500.00
12/31/^
11 /30/^0
11/30/41
12/31/40
12/31/40
12/31/^0
12/3l/IiO
97,560.00
.80*00
44,928.00
52,904.62
35,000.00
«35 ,-ooo.00
75,000.00
85,000.00
*
•m
97,832.62
-■I
110,000.00
120,000.00
721.00
75,000.00
75,721.00
77.062.50
77.062.50
■ 77,062.50
77,062.50
-206,250*00
99.999.96
- 85,539.77
3,900.00 210,150.00
1,800.00
50.000. 00
251,849.22
456,415.36
251,849-21
251.849.21
251.849.22
201,849.22
336,415.36
201.849.21
201.849.21
201.849.22
120,000.00
• 50,000.00
50.000.
50.000.
00
00
12/31/40
240.00
7 5 , 0 2 0 .0 0
00-000 *o£
O O “OOO*531
T-h/lC /1
on/XC/3X
101,799-96
85,539*77
tsto'x ii v a o a a o o
KOI i-wHO<raoo
75,260-^00
K'JTHO
“
H
OX1
--1
Œ
C
V
S
.O aSCX-I-TV
ccjlcl “s* -TV•rr
•q
•«una'p'V
NaME OP CORPORATION
a ND OPPICSRS OR
EMPLOYEES
-------------------------------- —
Ca l e n d a r o r
PISCAL YEAR
ENDED
---------------------------------------------------------------------------------------------------—
z 2 ; --:■
^
salary
commission
...........
bonus
...................................................................................................................
other
compen-
20
total
— --------------- ---------------------- SAT ION
NEW YORK (Con.)
12/31/1*0
12/31/1*0
-
50,000.00
•
75,000,00
50,000.00
.
1/31/^!
12/31/1*0
66,000.00
1*3,070.00
50,000.01*
27,500.00
2/28/Ul
12/31/1*0
100,000.00
5 ,150.00
so,150.00
220.00
109,290.00
77,500.01*
53»213.39
86,033.93
139,21*7.32
1*8,000.00
^3.237.00
91,237.00
12/31/1*0
ii*7,7Si. 81+
1^ 7,031.S2
12/31/1*0
12/31/1*0
100,159. ^
• 75,000.00
75,000,00
100,159.1*1*
534.99
698.31
75,53^*99
75,698.31
12/31/1*0
OQ -"J
OQ VJ1
O O
O .O .
.
O O
O O
ASIATIC PETROLEUM CORPORATION
Wilkinson, H.
BANKERS TRUST’COMPANY
Colt, S. Sloan
BEST AND COMPANY, INCORPORATED
Le Boutillier, Philip
BLYTE a ND CO., INC.
Mitchèli, Charles E.
b r o o k l y n -m a n k a t t a n t r a n s i t c o r p .
Dahi, G„ M.
CARTER CARBURETOR CORPORATION
Weed j Hugh H. C.
CELANÉSE CORPORATION OP AMERICA
Dreyfus, Dr. Camille
Dreyfus* Dr. Henry
CENTRAL HANOVER BANK & TRUST COMPANY
Gray, William S., Jr.
CERRO DE Pa SCÒ COPPER CORPORATION
Clark, Edward H.
Kingsmill, Harold
THE .CHASE NATIONAL BANK OP THE
‘CITY OP NEW YORK
Aldrich, Winthrop W.
Campbell, H. Donald
CHEMICAL BANK AND TRUST COMPANY
Johnston, Percy H.
Houston, Prank K.
175*000.00
100,000.00
12/31/1*0
100,000.00
75,000.00
1 ,500.00
182,-500.00
108,800.00
100,000.00
76,500.00
21
CALENDAR OR
FISCAL YEAR
SAL-ARY ■
COMMISSION
ENDED _______________________________ _
NAME OF CORPORATION
AND OFFICERS OR
EMPLOYEES
BONUS
OTHER .
COMPENTOTAL
SATION_______ _
NEW YORK (Con,)
CHICAGO TRIBUNE-NEW YORK NEWS
SYNDICATE, INCORPORATED
Gray & Gray
CITIES SERVICE COMPANY
Jones, W. Alton
CLUETT, PEABODY & CO., INC.
Palmer, C. R.
COLUMBIA BROADCASTING SYSTEM,
Paley, William S.
KLauber, Edward
COLUMBIA PICTURES CORPORATION
Arthur, Jean
Binyon, Claude
Bischoff, Samuel
Briskin, Samuel J .
Briskin, Samuel J.
Cohn, Harry
Cohn, Harry
Cohn,t Jack
Cohn, Jack
Dunne, Irene .
Grant, Cary
Grant, Cary
Hall, Alexander
Hall, Alexander
Higgles, Wesley
Ruggles, Wesley
Stihl, John
Stevens, George
Young, Loretta
12/31/40
000-.oo
80,966.¿2
101.966.82
150,000.00
300.00
150.300.00
a,
12/31/40
12/31/40
95,000.00
95^000:00
12/31/40
OO*OOÖ•T
6/30/40
6/30/40
6/30/41
6/30/40
6/30/41
6/30/40
6/30/41
6/30/40
6/30/41
6/30/41
6/30/40
6/30/41
6/30/40
6/30/41
6/30/40
6/30/41
6/30/41
6/30/41
6/30/40 “
204.319.82
100,679.76
110;833.33
94,500.00
121,041.67
89,‘200.00
118,800.00
134,166.53
130,000.00
76,666.53
78,000.00
135,000.03
206,250.00
131,250.00
98,666.67
91,666.67
199,999.80
120,384.50
75,166.67
174,359.00
170,000.00
oo —
OOO •S i.
OO "OOO* OOT
O O *0 0 0 *O O T
110,833. 33
94.500.00
121,041.67
89.200.00
118.800.00
149,766.53
145.600.00
76,666.53
88.400.00
135.000.
206.250.00
131.250.00
98.666.67
91.666.67
199,999.80
120,384.50
75.166.67
174.359.00
170.000.
15.600.00
15.600.00
10,400.00
O+l/li/21
XîîV«â3<00
•H*
p'^'OxiOfT
- M <
3C
o
g.
*H
* ‘V t ° d .<
^
-txr,aO
W
03
00
NAME OF CORPORATION
AND OFFICERS OR
EMPLOYEES
CALENDAR OR
FISCAL YEAR
ENDED
SALARY
COMMISSION
BONUS
OTHER
COMPEN
SATION
2a
TOTAL
NEW YORK (Con.)
COMMERCIAL INVESTMENT TRUST, INC.
Dietz, Arthur 0,
CONSOLIDATED OIL CORPORATION
Sinclair, H. F.
Sinclair, E. W.
Stanford, G. T.
CORN. EXCHANGE BANK TRUST COMPANY
Frew, Waiter E.
Sherer, Dunham B.
THE CROWELL-COLLIER PUBLISHING CO.
Beck, Thomas H.
CRUCIBLE STEEL COMPANY OF AMERICA
Hufnagel, F. B.
THE DELAWARE, LACKAWANNA AND
"WESTERN RAILROAD COMPANY
Davis, J. M.
THE DIAMOND MATCH COMPa NY
Fairbu.ru, W. A.
DONAHUE AND COE, INCORPORATED
Churchill, E* J.
T. M. DUCHE AND SONS, INCORPORATED
Graessle, W. F.
H. BUIS AND COMPANY, INCORPORATED
Steur-, John A. C.
EASTMAN KODAK COMPANY
Lovejo'y, Frank W.
EMERSON RADIO AND PHONOGRAPH CORP.
Abrams, Ben
00
‘ AS ~ n
00
-6
.00 - s s x • ;
12/31/40
100,000.00
90.00
100,090.00
12/31/40
I2/.3I/UO
200.000.
100.000.
8 0 , 8 3 3 .3 1
75.000.
75.000.
93O.OO200.930.00
i,o 4 o.oo 1 0 1 . 0 4 0 .0 0
so ,833.31
00
00
00
00
720.007 5 *7 2 0 .0 0
980.0075,980.00
1 2 /^ l/kO
75*000.00
2 4 0 .0 0
7 5 *2 4 0 .00
12/31/40
i 4 o,ooo. 00
1 4 0 , 0 0 0 .0 0
12/31/40
75,000.00
3,020.00
78,020.00
12/3l/40
100,000.00
100,000.00
12/31/40
128,380.00
11/30/41
3,120.00
s5.306.43
88,426.43
3/3l/4l
10,000.00
50,585.04
56,211.21
116,796.25
12/31/40
150,000.00
13,125.00
163,125.00
10/3l/4l
82,551.60
21
-NAME OF CORPORATION
.AND OFFICERS OH
SMP LOISES___
CALENDAR OH
FISCAL YEAR
; ..
SALARY
. . . .
COMMISSION
COMPENSATIOH
BOEUS
'TOTAL
■ -
HEW YORK (Con«)
WILLIAM ESTY. AND COMPANY, INC.
E s t ^ , William C.
ethyl gasoline
corporation
Webb, Earle W.
THE FIRST NATIONAL BANK OF THE
-CITY OF NEW YORK
Fraser, Leon
Welldon, Samuel A.
FOX WEST -COAST AGENCY CORPORATION
-Skouras, Charles P.
•Skouras, Charles P.
GANS •-'STEAMSHIP LINE
Meyer, Richard
GENERAL ANILINE AND FILM CORP.
•Schmitz, Dietrich A.
Hutz, R.
GENERAL ELECTRIC COMPANY
Reed, Philip D.
-Wilson, Charles E.
GENERAL FOODS CORPORATION
•Chester, Colby M.
Francis, Clarence
•Igleheart, Austin S.
Prescott, John S.
Metcalf, Charles W.
'Young, Udell- C. GENERAL MOTORS ACCEPTANCE CORP.
-Schumann, John J», Jr.
12/31/40
12/31/40
12/31/40
12/31/39
12/31/40
12/31/40
12/31/40
12/31/40
12/31/to
12/31/to
-
100,000.00
75.000.
75.000.
00
00
75.000.
78.000.
00
00
*
-
. 8 4 , 0 0 0 .0 0
69,999.96
- ,60,000.00
45.000.
50,246.36
45.000.
65,000.00
' 78,000.00
'78,000. do
' 81,895.17
550.00
550.00
.90,000.00
85,000.00
50.000.
75.000.
120,553*25
1,300.00 . ‘ 76.300.00
76.300.00
•1,300.00
S I, 8 9 5 . IT
4 0 , 0 0 0 .0 0
03
00
» •
60,000. bo
'90, 5 5 0 *00
■ $5,550.00
, ’ 90,000.03
135,000.00
8 4 , 0 0 0 .0 0
57.000.
4 8 .000.
37.500.00
43.300.00
37.500.00
00
00
4 0 0 .0 0
Ttl/xC /ot
O O " O O O *O S T
O O *5 3 T "it
1,835.25'
3$,7 1 8 .0 4
so,600.00
100,000.00
Otr/xC /3X
8 2 , 128 . 0 0 ’
00
00
* 126,999.96
1 0 8 , 0 0 0 .0 0
82,500.00
■ 93,546.36
.... 82,500.00
• 9, 738, 00; / : 157,266.00
NAME OP COBPOEATOT '
. AND GPPICEES OE
EMPLOYEES
____ __________________________________________________________________
- 24
CALENDAE OE
O T H E E .....
PISCa L YEAE
SALAEY
COMMISSION
BONUS
COMPEN' TOTAL
ENDED
”
‘ ______
SAT ION'' ' v_________
NSW YOEX (Con.)
x/3x/i+x
82
X2/3X/U0
4s
'U5
45
45
82,600.00
,600.00
■ 76,000.0a*
6 8 . 4 0 0 .0 0
53.200.00
53.200.00
00
00
00
0
0
0
0
0
, 0 * 0»
0000
0000
GTMBEL BEOTHEES, INCOEPOEa TED
. Gim^el, Bernard P.
W. E. GBACE AND COMPANY
.Iglehart, D. S„
.
Garni, A.
Eoig, H. J.
Holloway, W. G.
Up] GEEAT ATLANTIC AND PACIPIC
TEA COMPANY ( NEW JEESEY )
,Adams, 0. C.
^Brooks, C. A,
Byrnes, W. Jfi.
• Smith, E. B.
GUAEa NTX. TEUST COMPANY OP NEW YOBK
Conway, William Palen
Stepson, Eugene W.
KE a EST ENTEEPEISES, INCOEPOEATED
.Berlin, E. E.
HECHTa LEVIS & KAHN, INCOEPOEATEi) '
Bendixsen, a .
HUEOK ATTEACTIONS, INCOEPOEa TED
Anderson, M.
INGEESOLL-KAND COMPANY
.Doubleday, George
INTEENa TIONa L BUSINESS MACHINES'.COEPOEATION
Watson, Thomas J,
JQHNSrMANVILLE COEPOEATION _
-i; •
Brown, Lewis H.
1 2 4 , 000.-00
113: 4 oo.00
yO onn
Lw^o-Uw
98,200.00
2/28/41
60.00
101.919.00
•101,919.00
101.959.00
100,060.-00
6,376.08
*1 0 , 0 4 6 .6 6
106,376.08
8 5 , 0 4 6 .6 6
101 ,919.00
101 ,919.00
101 ,919.00
100 ,000.00
12/3l/^+0
4 0 .0 0
100 ,000.00
75 ,000.00
12/31/40
'20 ,000.00
12/31/UO
.
12/31/^0
12/31/^0
.12/31 A o
6 4 , 8 5 6 .0 2
49 .999.92
3/31/UX
114,855.94
*■
95.526.7s
‘
‘. r i -
•138; 549.66
13s ,'549.66
; 72 ,000.00
.•
100 ,000,00
’ s 6 , 0 0 0 .0 0
.115,526.7s
*
78,000.00
446,294.26
546,294.26
1 , 8 0 0 .0 0
9 7 , 8 0 0 .0 0
_____E3
NAME OP CORPORATION
AND 0PPICERS OR
EMPLOYEES
CALENDAR OR
FISCAL YEAR
ENDED
----- “
SALARY
‘
COMMISSION
BONUS
OTHER
COMPEN
SATION
TOTAL
NEW YORE (Con.)
JOHNSON AND HIGGINS
La Boyteaux, W. H.
Coe, George V.
Davey, W. N.
Lowe, Henry W.
Keegan, J. S.
Hunt, E. F.
KENNEGOTT COPPER CORPORATION
Birch, Stephen
Stannard, E. T.
KING FEATURES SYNDICATE, INC.
McManus, George
Ripley, R. L.
Young, Murat
LENNEN AND MITCHELL, INCORPORATED
Lennen, Philip W.
LEWYT METAL PRODUCTS COMPANY, INC.
Lewyt, Alexander
LOEW1S,INCORPORATED
Astaire, Fred
Barrymore, Lionel
Be ery, Wal1ac e
Beery, Wallace
Berkeley, Busty
Berman, Pandro S.
Bernstein, David
Bernstein, David
Borzage, Prank
Borzage, Prank
CO -OO0izs
<=>°-00» *X
12/31/40
220.00
100.00
1 9 4 , 4 2 1 .7 8
124,429-94
126¿374.l6
2 4 0 .0 0
220.00
.2 4 0 .0 0
220.00
126i 374,l6
1 0 0 , 4 5 1 .2 5
77 ,768.71
12/31/40
350.00
75,000.00
100,000.00
12/31/40
I2/31/4O
12/31/40
35.000.
8/31/Ì+I
8/31/41
8/31/41
8 /31/40
g/3 l / 4 l
8 /3 1 /UO
8/31/Ul
00 " 0 0 0 •9 6 _
00*000*oox
1 0 2 , 5 5 3 .3 4
1 1 8 , 4 5 1 .1 7
1 1 0 , 5 5 3 .2 0
1 0 2 , 5 5 3 .8 4
1 1 8 , 4 5 1 .1 7
cm/x E / á x
on/tc /si;
n o , 553.. 20
' 8 0 , 0 2 0 .0 0
1 0 0 , 2 0 0 .3 5
133.333-24
79.375.00
278.750.00
251.250.00
1 0 1 , 9 5 3 .3 3
156.000.
00
10,400.00
93.600.00
93.600.00
169.000.
00
169.000.
00
75,350.00
1 0 0 , 8 0 0 .0 0
65,200.35
00
8/31/UO
8/31/40
8/31/40
126,614.1-6
126 ,594.i 6
100,691.25
77,988.71
8 0 0 .0 0
20.00
8 0 , 0 0 0 .0 0
1 9 4 , 6 4 1 .7 8
1 2 4 , 5 2 9 .9 4
122,522.73
. 1 3 3 . 3 3 3 -2 4
7 9 , 8 7 5 -0 0
278.750.00
251.250.00
1 0 1 , 9 5 8 -3 3
156.000.
2 1 7 , 3 2 9 .1 9
1 1 3 , 3 2 9 .1 9
1 0 , 4 0 0 .0 0
226,522.73
169.000.
169.000.
_
L
AliTVVl— ïtliÔ Ï?
QTSxno-cti, •
k o Xa ^ g o á H o o '
ho'
iìiìwk h h 3iAt
SVHltXXTIO"VT* sssKisna t v'
00
00
00
NAME OF CORPORATION
AND OFFICERS OB.
EMPLOYEES
26
CALENDAR OB
ElSCAL YEAR
ENDED
SALARY
COMMISSION
BONUS
OTHER
COMPEN
SATION
TOTAL
NEW YORK (Con.)
LOEWIS, INCORPORATED (Con. )
Bren, Milton H.
Brown, Clarence
Brown, Clarence
Cantor, Eddie
Candor, Eddie
Chertok, Jack
Chodorov, Edward
Cohn, J. J.
Cohn, J. J.
Colhert, Claudette
Considine, J.
Jr.
Considine, J. W v Jr.
Conway, Jack
Conway, -Jack
Crawford, Joan
Crawford, Joan
Cukor, George
Cukor, George
Cummings, Jack
Cummings, Jack
Douglas, Melvyn
Douglas, Melvyn
Eddy, Nelson
Eddy, Nelson
Eleming, Victor
Eleming, Victor
Eranklin, Sidney
Eranklin, Sidney
8/31/kO
8/317 40
8/3l'/kl
8/31/kO
8/31/kl
8/31/41
8/31/40
8/51/40
8/3l/hl
8/31/40
8/31/40
8/31/41
8/31/40
8/31/41
8/31/40
8/31/41
8/31/40
s/31/ui
100,000.00
100,000.00
201,666.66
• 220,000.00
119,600,00
78,000.00
78,000.00
201,666.66
220,000.00
119,600.00
78,000.00
78,000.00
78,000.00
78,000.00
104,000.00
104,000.00
125,000.00
130,000.00
172,000.00
182,000.00
182,000.00
318,365.5 9
266,538.30
182,000.00
189,975.00
104,000.00
i
104,000.00
125,000.00
130,000.00
172,000.00
182,000.00
182,000.00
318,365.59
266,538.30
182,000.00
189,975.00
8/3l/40
8/31/41
8/31/40
8/31/41
* ’ 91,000.00
91,000.00
92,625.00
113,583.32
S/31/40
8/31/41
8/31/40
s/31/1+1
8/31/ijo
8/31/41
113,583.32
150,7^9.99
164,500.00
150,749.99
.177,750.00
164,500.00
177,750.00
92,625.00
185,666.66
185,666.66
142,000.00
177,70s . 33
182,000.00
142,000.00
177,708.33
182,000.00
27
NAME OE CORPORATION
AND OEEICERS OR
EMPLOYEES
CALENDAR OR
EI SCAL YEAR
ENDED
OTHER .f
SALARY
COMMISSION
BONUS
COMPENDI-
TOTAL
S.ATIQN__
NEW YORK (Con.)
LOEtf1S, INCORPORATED (Con.)
Gable, Clark
Gable, Clark
Garbo, Greta
Gar land ,•Uudy
Gibbons, Cedric
Gibbons, Cedric
Glazer, Benjamin
Goet z., Ben
Grant, Cary•
Hyman, B* H;
Hyman, B- H.
Katz,.Sam
Katz, Sam
Leonard, Robert Z.
Leonard, Robert Z.
Le Roy,.Mervyn
Le Roy,*Mervyn
Li chtmàn,■-•Al T
Lichtman, Al
Lighton, Louis D.
Lighton, Louis D.
Loew, Arthur M.
Loew, Arthur M.
Loos, Anita
Loos, Anita
*
- : •
Loy, Myrna
Loy, Myrna
298,544.73
8/3l/40
8/31^1
8/31/41
8/31/41
8/31/40
8 /3 1 /Ui
S/31/U0
298,544.73
S/31/U1
104.000.
00
125.000.
216,409.13
00
8/31/41
8/31/40
8/31^1
8/31/40
8/31/41
8/31/40
8/31/41
8/31/40
8/31/41
8/31/40
8/31/41
8/31/40
8/31/41
8/31/40
8/31/41
8/31/40
8/31/41
-8/31/40
8/31/41
357*500.00
203,333.33
100,902.64
91.000.
91.000.
00
00
00
49,789.50
60,989.58
182,000.00
00
182.000.
182,000.00
00
00<
00:
104.000.
125.000.
266,196.63
268,989.58
252,356.60
00'
00
277.979.17
203,041.66
208.000.
72,267.45
91,484.38
147.000.
91,000.00
91,000.00
160.666.68
138.166.69
96,356.60
121,979.17
156,650.00
156,000.00
156,000.00
1
100,902.64
91 .000.
91 .000.
93.333.33
93*333.33
208.000.
156,000.00
156,000.00
203,041.66
208,000.00
182,000.00
357,500.00
203,333.33
00
1 8 2 ,0 0 0 .0 0
1 8 2 ,0 0 0 .0 0
228,917.45
247,484.38 ]
156,000.00
147.000.
00
182.000.
00
182,000.00
91 ,000.00
91,000.00
160.666.68
138.166.69
P
-
-
-
Mffl OP CORPORATION
AND OPPICERS OR
EMPLOYEES
—
.
____ ,. -■ -
-TTTTT^-::,'... ....
:■--------------------- :-----------T--------------- -------— H
__
CALENDAR OR
PISCAL YEAR
ENDED
SALARY
S/31/UO
8/31/41
8/31/40
8/31/ta
8/31/40
8/31/in
8/31/40
8/31/41
300,000.00
173.333-31*
116,791.67
9.
6,250.00
156,000.00
156,000.00
IO5 .555.5I
158,600.00
8/31/41
8/31/41
8/31/41
83,l4l, 82
83,141.56
83,141.74
78,000.00
78,000.00
156,000.00
156,000.00
78,000.00
81,125.00
191,250.00
2ii.4i6.66
99,726.12
99,691.80
82,333.31*
79.333.35
79.833-31
267,500.00
256,250.00
114,400.00
81,941.66
COMMIé^ïON
28
OTHER
CQMPENSATION
BONUS
TOTAL
NEW YORK (Con.)
LOEW» S, INCORPORATED (Con. )
MacDonald, Jeannette
MacDonald, Jeannette
Mahin, John Lee
Mahin, John Lee
Mankiewicz, Joseph
Mankiewicz, Joseph
Mannix, E. J.
Mannìx, E. J.
Marx, Chico
Marx, Groucho
Marx, Harpo
.Mayer , J. G.
Mayer, J. G.
Mayer, Louis B.
Mayer, Louis R.
McGuinness, James
McGuinness, James
Montgomery, Robert
Montgomery, Robert
Morgan, Prank
Morgan, Prank
Muriin, Jane
Pidgeon, Walter
Powell, Eleanor
Powèll, William
Powell,, William
Rapi, Harry
Rapi, Harry
fr
■—TI-Ì-- -■
A
MI
-----------------«--
-- ------ :-- —
t
- st?
8/31/40
8/31/41
8/31/40
8/31/41
8/31/40
8/31/40
8/31/1*1
8/31/40
8/31/41
8/31/40
8/31/41
8/31/40
8/31/40
8/31/41
8/31/40 v
8/31/1*1
Ah III 1
96,356.60
121,979.17
548.425.6o
30,1+9!*.79
300,000.00
173,333-34
116,791.67
96,250.00
156,000.00
156,000.00
201,912.11
280,579-17
83.l4l.82
83,141.56
83,141.74
54i .q 48.69
24,089.15
... ... ^ .. -.--a
78,000.00
78,000.00
697,04g..69
704,425.60
78,000.00
81,125.00
191,250.00
211,416.66
99,726.12
99.691.so
82,333.34
■79.333.35
79.833.31
267,500.00
256,250.00
138,439.15
112,436.45
—
---
J
2i
Na m e Of CORPORATION
a n d OEEICERS OR
employees
CALENDAR OR
EISCAL YEAR
ENDED
-- ------------------- ;
OTHER
COMMISSION
BONUS
COMPEL!__________________ SAT ION
SALARY
TOTAL
_________
NEW YORE (Con.),
LOEW’S, INCORPORATED (Con.)
Robinson, Edward O.
Rodgers, William
Rodgers, W. E.
Rooney, Mickey
Ruben, J. Walter
Ruben, J. Walter
Rubin, J. Robert
Rubin, J. Robert
Russell, Rosalind
Saville, Victor
SaVille, Victor
Schenck, N. M.
Schenck, Nicholas M.
Seitz, G-eorge
Seitz, G-eorge
Shearer, Norma
Shearer, Norma
Stothart, Herbert
Stothart, Herbert
Stromberg, Hunt
Stromberg, Hunt
Sullavan, Margaret
Taurog, Norman
Taurog, Norman
Taylor, Robert
Taylor, Robert
Thau, Benjamin
Thau, Benjamin
g/ 31/iu
S/3l/^0
8/3 l M
8/31/41
S/3I/U0
g/31/^l
g/31/4-O
S/31/U1
8/31/41
8/31/40
8/31/41
8/31/40
s/3i/^i
8/31/40
8/31/41
8/31/40
8/31/41
8/31/40
s/31/41
8/31/40
.8/31/41
8/31/40
8/31/40
8/31/41
8/31/40
8/31/41
8/31/40
8/31/^
100.000.
104.000.
104.000.
1 0 0 ,0 0 0 .0 0
104.000.
104.000.
172,416.66
91.000.
00
00
9^,583-33
88.5400.00
00
128,070.19'
15 ,600.00
100 ,308.13
88.5400.00
15 .600.00
197,^99.99
91 .000.
91.000.
00
204,308.13
87.200.00
87.200.00
105.300.00
105.300.00
75,150.00
75,316.67
150.000.
150.000.
78.000.
78.000.
260.000.
220.000.
113.933-32
156.000.
156.000.
199.999.99
. 172,416.66
91.000.
94,583.33
232,070.19
8 0 , 3 3 3 -3 3
80,333-33
104.000.
00
00
00
104.000.
00
24,700.00
204,204.54
00
00
00
00
00
00
188,881.97
24.700.00
318,881.97
334,204.54
75.150.00
75,316.67
150.000.
00
150.000.
00
78.000.
00
78.000.
00
332,267.45
'297,^09.72
113.933.32
156.000.
00
72,267.45
77,409.72
00
00
156.000.
4 8 , 1 7 8 .3 1
00
00
60,989.58
00
00
199,999.99
197,^99.99
139,178.31
151,989.58
-I n / - tc /S
>
OO ”00*1 •-*tre"
1
“
*
SS
00
9
xC
*
62.
sc -ccc-6/.
OO -00S ■¿9«
/. ■'J/*
Otl/xt /s
x-n/ x c /s
x c /e
cj’
E' /
XX ~
V
M
.
TOTST.XXTIA
.
jcouraox^t
txo
ct
\
NAME OF CORPORATION
AND OFFICERS OR
EMPLOYEES
CALENDAR OR
FISCAL YEAR
ENDED
30
”
TOTAL
OTHER
SALARY
COMMISSION
BONUS
COMPEN—
____________________________________ SAT ION
NEW YORK (Con.)
LOEWS, INCORPORATED (Con.)
Thorpe, Richard
Thorpe, Richard
Tracy, Spencer
Tracy, Spencer
Van Dyke, W S.
Van Dyke, W. S.
Vidor, King
Vidor, King
Weingarten, Laurence
Weingarten, Laurence
Wilson, Carey
Wilson, Carey
Winninger, Charles
Young, Robert
Young, Robert
LUCKENBACH STEAMSHIP CO., INC.
Luckenbach, Edgar F.
R./H. MACY.& CO., INC.
Straus, Jack I.
¿Marks, Edwin I.
8/31/40
8/31/41
8/31/40
8/31/41
8/31/40
8/51/41
8/31/40
8/31/41
8/31/40
8/31/41
8/31/40
8/31/41
8/31/41
8/31/40
8/31/41
12/31/40
101
101,239.51
94,625.00
208,000.00
247
33
«
( , 0383
0 0 ,0 .0
229 750
00
/ou.uu
239 51
94 625 00
PDR^nnnnn
- ■ 0208,000.00
4 . 7 zo7 <7tz
ppg ooo.oo
aa
..
201,583.33
117 901 nn
II/, 250.00
155 250 00
1« n m ' m
24,089.15
^fi’m n 'nn
30,494.79
89* 858* 33
82*000"01
87 208 3P
pfv’
„
201,583.33
■ 117 250 00
-uw,, cou.uu
155,250.00
180,089.15
195,078.12
'
i: S * S
11^,208.34
86,800.00
89,858.53
82,000.01
«
■ ■87,208=82
.• 113, 208;34
'
97,916.66
1/31/41
97,916:66
11,950.00
12,089.00
/5,051.25
—
O
O
”0 0 0 *
------------1
1
,1
...............
240.00
260.00
„H
— ....................................................................................._......_ ...................__
83,728.75
87,380.25
-
<tll
31
NAME QE. -CORPORATION
. , CALENDAR OR
EISCAL YEAR
A ® OFFICERS OR
1,; ...EMPLOYEES
_________ '
SALARY
COMMISSION
BONUS
TOTAL
*
HEW YORK (Con.)
8/31/41
83,200.00
87,100.00
12/31/40
91,200.00
12/31/40
12/31/40
75.000. 00
3 i+,5 7 S.OO
30.000. 00 ...
50,000.00
25.000. 00
*18,000.00
8/31/41
75,000*00
40.000. 00
12/31/40
•
633.te
i.300.00-
'
81,500.00*
101,519.27
79,215.te
76,519.27
6 l . 2 l 5 .te
75,000.00
36,500.00
, '
99,999.84
75,000.00
-
150^ 000.00
100,000.00
1 1 0 , 2 1 1 .4 7
125,000.00
96.000. 00
12/31/40
12/31/40
91,200.00
. m *» m
.125*000.00
6/30/41
12/31/40
. 2 , 4 0 2 ,9 5 : 1 3 7 , 1)0 2 .9 5
135,000.00
12/31/40
12/31/40
16,900.00
00
0 0*
•
00
0
0
OJ 0
CO0
rH
MARCUS LOEW BOOKING AGENCY
Friedman, Leopold
Moskowitz; Charles C.
MANUFACTURERS TRUST COMPANY
Gibson, Harvey D.
THE MATHIESON ALKALI WORKS (INC*)
Allen,-E. M.
MCCALL CORPORATION
Warner, William B.
•McCRORY STORES CORPORATION
Coppedge, R. F.
-METROPOLITAN LIEE INSURANCE COMPANY
Lincoln, Leroy A.
THE MEYER .AND. BROWN CORPORATION
| Smith, William G., Jr*
Meyer, Herbert E,
MORGAN STANLEY-AND COMPANY, INC.
-Stanley, .Harold
•Hall, Perry E.
NATIONAL BISCUIT COMPANY
Tomlinson, R. E*
THE NATIONAL CITY BANK OE NEW YORK
* Rentschler, Gordon, S.
. v Burgess, W. Randolph
-NATIONAL DAIRY PRODUCTS CORPORATION
, Mclnnerney, Thomas H.
NATIONAL DISTILLERS PRODUCTS CORP.
Porter. Seton
OTHER
COÍCPENSATION
73.n3.76
1.940.00
2 . 0 8 0 .0 0
151,940,00
78,580.00
6OO.OO
96,600.00
4 , 7 0 0 .0 0
■4 , 3 0 0 .0 0
10 ^, 6 9 9 . 81)-
5 4 0 .0 0
150,540.00
79,300.00
173.713.76
NAME OE CORPORATION
AND OPEICERS OR
EMPLOYEES
..... ...... ..
CALENDAR OR
PISCAL YEAR
ENDED
SALARY
COMMISSION
BONUS■ ■
OTHER
COMPEN
SATION
,
J2
TOTAL
HEW YORK (Con.)
NATIONAL THEATRES AMUSEMENT CO.,IRC.
ökouras, Spyros P.
RESTLE*S MILK PRODUCTS, INC.
Horion, D. P.
T HE’NEW JERSEY ZINC COMPANY
Hayes, J. E.
NEW YORK LIEE INSURANCE COMPANY
Buckner, Thomas'A.
NEW YORK TELEPHONE COMPANY
Kilpatrick, J. L.
THE NEW YORK TRUST COMPANY
Buckner, Mortimer N.
Cates, Artemus I».
NEWS SYNDICATE COMPANY, INCORPORATED
Annenberg, M.
" Plÿnn,' F. M.
Holliss, R. C.
PARAMOUNT PICTURES, INCORPORATED
Benny, Jack
Butler, Prank Russell
Carroll, Madeleine
Colbert, Claudette
Crosby, Harry L., Jr. (Bing Crosby)
Preeman, Y. Prank
Griffith, Edward H.
Hathaway, Henry
Hope, Bob
Hornblow, Arthur, Jr.
1 2 /31/40
78,000.00
12/31/^0
57,500.00
, 90,000.00
. 90,000.00
1 2 /31/40
76,500.00
1 2 /31/40
3.163.50
77.325.16
79,663.50
77,325.16
1 2 /31/43
1 2 / 31/40
135,500.00
86,333.33
1 , 8 8 0 .0 0
8 8 , 2 1 3 .3 3
90,000.00
75.000.00
4 , 9 0 0 .0 0
4 , 8 5 0 .0 0
94,900.00
79,850.00
50,000.00
50,000.00
50,000.00
61,013.03
61,013.03
^1,013.03
111,013.03
111,013.03
111,013.03
■
1 2 /31/40
l/ 4 /4 l
125,000.00
- S I, 0 4 1 .6 7
98,599.99
150,000.00
3 0 2 , 3 1 4 .8 1
106,000.00
126,707.69
144,250.00
120,083.32
159,000.00
, 125,000.00
81, 0 4 1 .6 7
9 8 , 5 9 9 -9 9
150,000.00
3 0 2 , 3 1 4 .8 1
106,000.00
126,707.69
1 4 4 , 2 5 0 .0 0
120,083.32
159,000.00
CALENDAR OR
FISCAL YEAR
ENDED
M M E OF CORPORATION
AND OFFICERS OR
employees
---------- -------- — -------------- ~
SALARY
commission
bonds
OTHER
compen-
TOTAL
NEW YORK (Con.)
■p apa MOUNT PICTURES, INCORPORATED (Con.)
LeBaron, William
Leisen, Jamas Mitchell
MacMurray, Fred
March, FrederiCMilland, Raymond
Sandrich, Mark Rex
Sturges^ Preston
Veiller, Anthony DeWolfe
Wellman, William A.
Zukor, Adolph
Brackett, Charles
Stanwyck, Barbara
PHELPS DODGE CORPORATION
a s m
x ta B
-i o /t i /Ld
12/^1/^
-%/hn/ki
3/31/
185,562.56
143.750.00
248,333*33
I04,l66.67
84,682*52
103.125.00
147,583*33
84,250.00
•119,169.30
106,000.00
75.812.50
75.937.50
inc.
100,000.00
100,000.00
2 5 .0 0 0 .
2 5 .0 0 0 .
00
00
12/31/XO
48,000.00
87.500.00
87.500.00
62.500.00
62.500.00
240.00
100,000.00
os a
mtrica
T H ^ S aIEE’S^XSEST ASS'N,
Payne, Kenneth W,
62.56
1 8 5 , 5 0 0 .0 0
. 1 ^3 , 7 5 0 .0 0
. 2 4 8 , 3 3 3 -3 3
*io*+,166.67
. g4 , 6 8 2 .5 2
.103 ,125.00
. 147 -, 5 8 3 .3 3
8 4 , 2 5 0 .0 0
,119 .,169 .30
106 ,000.00
7 5 , 812.^50
7 5 »9 3 7 *50
Cates, Louis Si
PHILIP MORRIS & CO*, LTD. INC,
Clialkley, 0. H.
^ %
l/H/M-1
4l 500.00
100,240.00
89*500.00
».
99,500.00
9 9 ,5 0 0 .0 0
Cole, Albert L*
EEEVES BROTHERS, INCORPORATED
i/7 n/ki
6/3°/41
18,000.00
remington rand* incorporated
3/31
85,000.00
58,050.00
93,812.27
7 6 ,0 5 0 .0 0
2,015.00
'
160,827.27
Rand, J. H . , Jr.
00—
000“ s s t
OO"OOO* 6ÔX
9 0 * OST
3 S fH
00*oô3
*trnt
~ L o L *93t
*£80 * 0 3 “
C
^
•H'-pjctaft-pa
q.os.
»o t i o i l
*ABiws-oi-v'eH.
-_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ :_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ __ ____
NAME OF CORPORATION
AND OFFICERS OR
EMPLOYEES
CALENDAR OR
FISCAL YEAR
ENDED
SALARY
..
COMMISSION
3*+
BONUS
OTHER.
COMPEN
SATION
TOTAL
NEW YORK (Con.)
RKO R a d i o PICTURES, INCORPORATED
12/ 31/ko
Dunne, Irene
Edington, Harry
Kanin, Garson
Laughton, Charles
Milestone, Lewis
Pommer, Erich
Rogers, Ginger
Wood, Sam
ROCKEFELLER CENTER, INCORPORATED
12/31/1+0
Robertson, Hugh S.
RUSSELL, BURDSALL & WARD BOLT
AND NUT COMPANY
6/30/1«.
Ward, Evans
SAKS AND COMPANY
1 /31^1
Gimbel, Adam L.
SOCONY-VACUUM OIL COMPANY, INC,
12/31/^0
Brown, John A.
Corwin, Arthur F.
Sheets, Harold F.
STANDARD BRANDS, INCORPORATED
12/31/1+0
Smith, Thomas L.
STANDARD OIL CO. OF NEW JERSEY
12/31/ko
Sadler, E. J.
STANDARD OIL CO. (INC. IN NEW JERSEY) 12/31 A O
Farish, W. S.
Harden, Orville
Gallagher, R. W.
1
90,000.00
90,000.00
76,500.00
• 76.5OO.OO
97.500.00
170,^96.50
102,500.00
95.500.00
25^.^16.65
' 80,000.00
25l+,i+i6.65
80,000.0©
80,000.00
.. 80,000.00
97.500.00
170,1+96.5©
102,500.00
95,500.00
22,500.00
113,225.83
59,000.00
21,000.00
1+8,655.00
nl+, 1+1+0. 83
80,000.0©
120,000.00
120,000.00
80,100.00
80,000.00
80,100. ©3
80,000.00
75,000.00
90,000.00 1
50.00
75.O5O.OO
90,000.00
■125,000.00
90,000.00
125,000.00
90,000.0©
80,000.00
80,000.00
NAME 0E CORPORATION
AND 0EEICERS OR
EMPLOYEES
CALENDAR OR
PIS CAL YEAR
ENDED
SALARY
COMMISSION
__ ________________33.
OTHER
COMPEN“TOTAL
SATION
,
BONUS
NEW YORK (Con.)
STATES MARINE CORPORATION
Mercer, Henry D.
STERN BROTHERS
Riordan, William 0.
TALBOT BIRD & COMPANY
Bird, Samuel,Jr.
THE TEXAS COMPANY
Rodgers, W. S. S.
Rieher, T.
Klein, Harry T.
J i WALTER THOMPSON CO.
Resor, Stanley
t w e n t i e TH-CENTDRY EOX EILM CORP.
Kent, Sidney R.
Ameche, Don
Brown, Harry Joe
Cummings, Irving
Day, Richard W.
F d y e , Alice
Eonda, Henry
Johnson, Nunnally H.
King, Henry
Koenig, William
Lang, Walter
MacG-owah, Kenneth
Muni, Paul
Oakie, Jack
Power, Tyrone
Trot'ti, Lamar
Wurtzel, Sol M.
I2/3I/U0
1/31/1+x
76,975*00/
125,000.00
100,000.00
95,000.00
125.000.
100.000.
95.000.
00
00
00
8 1 , 0 0 0 .0 0
81.000.
00
150,000.00
ihb,666.b7
1 2 3 *3 3 3 *3 3
162,350.00
79,500.00
157.h58.32
172,208.33
89,000.00
157.500.00
79,500.00
. 107,916.67
9 7 . 5 8 3 .3 3
120,000.00
78.h16.66
..
150.000.
00
1^7,82^.15
123,333*33
162.350.00
79.500.00 ,
1,157*^S
157.95s. 3a
50Q.00
172,208.33
89,000.00
157.500.00
79.500.00
107,916.67
97.5s3.33
78,750.00
lh 6 ,500.00
00
*000*Ô2T
*S
0+1 / x £ / S X
(A S S H a r
JA EU St
H I
" O K I )
.
120.000.
00
78.h16.66
169.009.00
78,750.00
1h6.500.oo
^7,550.66
121,458.3^
00
" O O O • OS3
OO* OOO* 0 6
(K> * 0 0 0 *
75,180.00
180.00
76,975.00
12/31/^0
12/31/ho
25,000.00
50,000.00
1 2 /31/40
12/31/ho
95,000.00/,
95,000.00
~ o o
•JS
»
V *
1 ^ *
"V^
Æ
ÏÏME OF CORPORATION
CALENDAR OR
AM) OFFICERS OR
FISCAL YEAR
_______
EMPLOYEES ________________ ENDU'D
SALARY
COMMISSION
BOBUS
ii
OTHER
COMPEN
SATION
TOTAL
MEW YORK (Con.)
UNDERWOOD ELLIOTT FISHER:COMPANY - DELAWARE.
12/31/1(0
wagoner, P. D.
UNION BAG & PAPER CORPORATION
12/31/1+0
Calder, Alexander
UNION PACIFIC RAILROAD COMPANY
AND AFFILIATED RAILROAD COMPANIES 12/31/40
Jeffers, W. M.
UNITED ARTISTS CORPORATION
12/31/40
Silverstone, Maurice
UNITED STATES RUBBER COMPANY
12/31/40
Davis, F* B., Jr.
Tompkins, L. D.
Coughlin, E. J.
Smith, H. E.
Needhami T. J.
Roberts,- Elmer
Humphreys, H. E v Jr.
Adamson, Percy
UNITED STATES STEEL CORP. (N. J.)
12/31/40
Stettinius, E. R.^ Jr.
Olds, Irving S.
Voorhees, E. M,
UNIVERSAL PICTURES COMPANY, INC.
Abbott, Bud, and Costello, Lou
10/3l/41
Blumberg, N. J.
10/31/41
Boyer, Charles
10/31/41
Cowdin, J, Cheever
10/31/41
Crosby, Bing
10/31/40
108,000,00
108,580.00
5S0.00
60,000.00
26,790.00
75*000.00
86,790.00
725.00
75*725,00
136,000.00
156*000.00
150,000.00
48.000. 00
27.553.76
■48,000.00
36.000.00
36,000.00
36,000.00
67.938. 1 5
56.615.63
131.052.64
67.938.75
56.615.63
56.615.63
56.615.63
240.00
260.00
2*+0.00
240.00
.
150,260.00
116 .198.75
84,269.39
116.178.75
92,875.63
92,855.63
92,855.63"
131,052.64"
11 , 592.63
2,800.00
6,500.00
6,700.00
80,392.63
81,203.73
106,700.08
89.076.26
575.00
29i.9O5.5S
56,042.25
56,042*25
950.00
7^,703.73
100,000.08
202,829.32
87,850.00
220.,833.34
119 .000.00
150,000.00•
260.00
260.00
100.00
144.467.25
220,833*34
175.992.25
150,000.00
il
Na ME OE CORPORATION
ÜTD OîTICffiS OR
EMPLOYEES
CALENDAR OR
EISCAL YEAR
ENDED
_
SALARY
OTHER
COMMISSION
BONUS
COMPEN'^4oTAL
____________ S A T I O N ___________
NEW YORK (Con.)
UNIVERSAL PICTURES COMPANY,INC. (Con.)
10/31/40
Dietrich, Marlene
10/31/41
Dietrich, Marlene
10/31/41
Dunne, Irene
1 0 /31/40
Durbin, Edna Mae
10/31/^1
Durbin, Edna Mae
1 0 /3 l /40
Eields, W. C.
10/31/^1
Eields, W. C.
10/31/41
Pox, Matthew
10/31/41
Herbert, Hugh
1 0 /31/40
Koster, Henry
1 0 /31/41
Koster, Henry
10/31/41
Manning, Bruce
IO/31/4O
McLaglen, Victor
10/31/40
Pasternak, Jos.
1 0 /31/41
Pasternak, Jos.
10/31/41
Prutzman, Charles D.
10/31/41
Scully, William A.
10/31/41
Seidelman, Joseph
IO/31/4O
Seiter, William
10
/31/41
Seiter, William
10/31/
4L
Sullavan, Margaret
10/31/4L
Tone, Eranchot
10/31/41
Work, Cliff
12/31/40
.. t . Va n d e r b i l t c o m p a n y , i n c .
Vanderbilt, R. T.
Somerville, a . a .
g/31/41
'TTAGRAPH, INC.
Einfeld, S. Charles
Sears, G-radwell L.
91,000.00
91,000.00
00 *OOO •OST
00 *O O O *Stt
0 0 *o S s *
/'OX
•at.öjy.öo-ctc»
tvo*
-t
•o XT»iv« o o
* ir
*i» "*k *a»®<vo«vt®
P^-e ‘P1«« •
hams os corporation
AHD OSSICSRS OR
EMPLOYEES____________
____IS
calender or
SISCAL TSAR
ENDED
SALARY
COMMISSION
OTHER
BONUS
COMPEN______________SAT ION
TOTAL
HEW YORK (Con.)
WALLERSTEIN COMPANY, INC.
12/31 /40
Wallerstein, Leo
Graf, William
WARNER. BROS. CIRCUIT MANAGEMENT COEP. 8/31/41
Bernhard, Joseph
WARNER BROS. PICTURES, INC.
8/31/41
Bacon, Lloyd
Blanke, Henry
Brent, George
Cagney, James
Coffee, -Lenore
Curtiz, Michael
Davis, Bette
Dietrich, Marlene
Elynn, Errol
Sorhstein, Leo
Soy, Bryan
Goulding, Edmund
Hawks, Howard
Keighley, William
Litvak, Anatole
Lord, Robert
March, Srederic
Oakie, Jack
Oberon, Merle
Raine, N. R.
Robinson, Casey
Robinson, Edward G.
Schneider, S.
Steiner, Max
94,000.00
81,000.00
104,000.00
94.000.
81.000.
26,000.00
192.000. 00
99.750.00
127.000. 00
362.500.00
78,000.00
78 , 000.00
271,083.27
100.000. 00
240.000. 00
78,000.00
156.000. 00
91.590.00
110,766.66
133.166.67
115,000.00
142,325.00
100,000.00
82,812.50
85,000.00
81.150.00
130,000.00
192,000.00
99.750.00
127,000.00
362,500.00
187.200.00
76.000. 00
109.791.67
171.416.67
65.000. 00
00
00
13,000.00
1 8 7 , 2 0 0 .0 0
271,083.27
1 0 0 , 0 0 0 .0 0
240.000.
78,000.00
15 6 .0 0 0 .
9 1.50 0 .0 0
110 ,7 6 6 .6 6
133.166.67
115,0 0 0 .0 0
142,325.00
1 0 0 ,0 0 0 .0 0
8 2 , 8 1 2 .5 0
85,000.00
76,000.00
109.791.67
171.416.67
78,000.00
8 1 ,150.00
00
00
____________
KÄME OE COEPORATIOK
AKD OFFICERS OE
EMPLOYEES
CALENDAR OE
EI SCAL YEAS
EKDED
- -
-- ---- —
SALARY
COMMISSIOK
BOKUS
.. .
' OTHER
COMPEKSAT IOK
39
TOTAL
_______ _
KEW YOEK (Con.)
WARNER BEOS. P ICTUSES, IKC. (Con.)
Wallis, H. B.
Walsh, Raoul
Warner, Albert
Warner, H. M.
Warner, J- L.
Wood,. Sam
WESTERK ELECTRIC COMPANY, Ine.
Stoll, C. G.
THE WESTERK UHIOK TELEGRAPH CO.
White, Roy B.
E. W. WOOLWOETH COMPANY
Deyo, C. W.
•
'
Cornwell, A. L.
S/3X/ÌML
12/31/^0
12/31/^0
260,000.00
260,000.00
• 97,750.00
91,000.00
130,000.00
156,000.00
9 9 , 1 6 6 .6 7
13,000.00
26,000.00
26,000.00
75,000.00
4 8 0 .0 0
7 5 , 4 8 0 .0 0
85,000.00
1,855.00
86,855.00
12/31/^0
97,750.00
1 0 4 .0 0 0 .
156.000.
1 8 2 .0 0 0 .
9 9 , 1 6 6 .6 7
00
00
00
201,779.60
75.742.59
201,779.60A
7 5 *7 4 2 .5 9
HOSTH CAROLIKA
E. J* REYKOLDS TOBACCO COMPAKY
Williams, S. Clay
12/31/^0
100 ,000.00
•100,000.00
OHIO
THE AETKA PAPER COMPAKY
Howard, H. M.
THE AMERICAN ROLLING MILL CO. ■
Hook, Charles E.
Verity, Calvin
THE BUCKEYE TRACTIOH DITCHER CO. •
Schcmburg, William H.
12/31/^0
12/31/^0
lO/31/^l
36,000.00
3 9 *390.41
7 5 , 3 4 0 . 41 .
80,250.00
5 8 , 8 4 9 .8 4
2 5 , 563.27
1 8 , 7I+6.28
105,813.27
77,596.12
10,000.00
125, 587.15
135,587.15
4
-s¿g
-T6¿ Got
>-¿00■ 000 sâs
00 *000
“ï i o a e ^ o
ato-«C *
40
KÄME OE CORPORATION
ARD OFFICERS OR
EMPLOYEES
CALENDAR OR
PISCAL YEAR
ENDED
salary
COMISSION
BONUS
OTHER
COMPEN
SATION
TOTAL
OHIO (Con.)
CHAMPION SPARK PLUG COMPANY
Stranahan, Robert A.
Stranahan, Prank D.
THE CLEVELAND PNEUMATIC TOOL CO.
Greve, Louis W.
Greve, Louis W.
l/l/4l
I2/31/UO
170,000.00
120,000.00
170,000.00
120,000.00
12/31/40
i s , 000.00
128,198.32
— ll/30/^l
146,198.32
114,584.00
CLOPAY CORPORATION
Joiinson, Sam J.
EATON MANUPACTURING COMPANY
Eaton, J* 0.
THE ELECTRIC AUTO-LITE COMPANY
Martin, Royce G.
THE GENERAL TIRE AND RUBBER CO.
O ’Neil, W.
THE GLIDDEN COMPANY
Joyce, Adrian D.
GOODYEAR TIRE AND RUBBER COMPANY
Litchfield, P. W.
THE GRUEN WATCH COMPANY
Katz, Benj. S.
INDUSTRIAL RAYON CORPORATION
Rivitz, Hiram S.
THE ANDREW JERGENS COMPANY
Jergens, Andrew
Nelson, Joseph D.
15,000.00
90,055-71
lO5 .O55.7i
45,000.00
55,000.00
100,000.00
100,000.00
7,500.00
I2/31/UO
I2/31/UO
II/30/U1
IO/3I/U1
10,000.00
3/31/41
I5O.OO
94,003.70
107,650.00
104,003.70
96,000.00
I2/31/UO
60.OO
100,000.00
96,060.00
100,000.00
36,000.00
46,893.45
82,893.45
75.000.00
27,500.00
102,500.00
95.633.57
184,636.42
100,633.57
12/31/40
11/30/40
II/3O/41
Jergens, Andrew
Nelson, Joseph D.
114,584.00
I2/31/Ì+O
5,000.00
5,000.00
5,000.00
5,000.00
v
139,319.03
157,S19.03
189,636.42
144,319.03
162/8I9.O3
i+X
CALENDAR OR
M M E OF CCEP0R.iTIOK
aID OFFICERS OR
EMPLOYEES_____
FISCAL YEAR
SALARY
ENDED____________ _____
COMISSION
BONUS
OTHER
COMPEN
SATION .
TOTAL
OHIO (Con.)
KROGER'GROCERY & BAKING CO.
Morrill, Albert H.
Bracy., Harry W.
THE F.,AND R. LAZARUS AND CO.
Lazarus, Simon
Lazarus,, Fred, Jr.
THE R. K. LeBLOND MACH IHE TOOL CO.
Groene, William F.
LeBlond, Richard E.
LeBlond, R. K.
Pierle, Henry C.
Schp.lt z, E. G.
THE MIDLAND STEEL PRODUCTS CO. •
Kulas, E. J.
Stoner, Gordon
THE RATIONAL ACME COMPANY
Chapin, F. H.
THE NATIONAL Ca SH REGISTER CO.
Deeds, E. A.
OWENS-ILLINOIS GLASS COMPANY
Levis, William E.
PERIODICAL PUBLISHERS’ SERVICE
BUREAU, INC.
Bull, H. G.
Dymond, 0. L.
Landry, William
Ory, L. E^
TTTP, PLAIN DEALER PUBLISHING CO.
McGarrens, John S.
the
12/31/^0
19,375.00
97,500.12
25,000.00
1 /31/M-X
12/31/^0
100.000.
100.000.
181,402.20
100.000.
100.000.
00
00
213,321.97
110.588.26
110.522.26
12/31/^0
12/31/^0
12/31/^0
117,568.91
122,9^5.71'
213,601.57-'
117,55^ 2^
117 ,7^.97
6,920.65
7 ,121.10
279-60
6,926.52
7 ,152.71
110,52s. 26
115,824.61
12/31/^0
116,875.12
206,1+02.20
99.450.00
76.950.00
80,000.00
60,000.00
20,000.-00
75 ,'000.00
■ 100,000.00
25,000.00
t*
125,000.16
12/31/HO
5/31/Ul
99,1*50.oo.
76,950.00
♦
125,000.16
ST.268-53
82,575.80
85,^66.69
103,ISS.7 1
110,102.30
60,000.00
170,102.30
/
00—
000 *s
9*
/ <£ *£ C 9 *O O T
str •gC‘9 *-frsrx
0 0 *ooo *5
00-000• 5
X+l/oC / XX
0+1/oC /XX
—
rr
x^
duo00 p
« .o a p t i v
*xai>ox®St
•OXXGlSJCOp
Mcvawoo simo'scair wncaccscv
00
00;
42
NAME 0? CORPORATION
AND OPPICERS OR
EMPLOYEES
CALENDAR OR
PISCAL YEAR
, ....
ENDED
other;
SALARY
COMMISSION
BONUS
COMPEN-'
SATION
. TOTAL
OHIO (Con.)
THE PROCTER & GAMBLE COMPANY
Deupree, R. R.
Barnes, P. M.
Brodie, R. K.
Huff, C; J.
SFICER MANUPACTURING CORPORATION
Carpenter, R. E.
THE"STANDARD OIL COMPANY (OHIO)
Holliday; W. T.
THOMPSON PRODUCTS, INCORPORATED
Crawford, P. C.
*
THE TIMKEN ROLLER BEARING COMPANY
Umstattd, W. E.
THE UNITED STATES SHOE CORPORATION
Cohen, A. B.
Salinger; A.
Stern, Jos. S.
6/30/1+1
8/31/Ul
100,000.00
4 0 , 0 0 0 .0 0
4 0 , 0 0 0 .0 0
30,000.00
100,000.00
60,000.00
50,000.00
200,000.00
100,000.00
100,000.00
8 0 , 0 0 0 .0 0
25,000.00
71,500.00
96,500.00
60,000.00
1 2 /31/40
90*000.00
90,000.00
1 2 /31/40
1 2 /31/40
1 1 /30/40
90,999*92
105,000.00
* ‘
25,000.00
25,000.00
25,000.00
%
110,542.80
110,542.80
'110,542.80
79.2SS. 76
7 9 , 2 8 8 .7 7
98,612.34
45,000.00
3,060.00
1 4 0 , 0 0 0 .0 0
79.2ss.76
50,000.00
1 2 /31/40
1 2 /31/40
35,000.00
85,5^2.80 .
25,000.00
25,000.00
25,000.00
1 2 /31/40
9 1 , 2 5 4 .9 2
8 5 , 5 4 2 .8 0
8 5 , 5 4 2 .8 0
1 1 /30/41
Cohen; A. B.
Salinger* A.
Stern; J, S.
Weil, H. E.
t h ^ Wa r n e r & s w a s s y c o m p a n y
Stilwell, C. J.
THE WHITE MOTOR COMPANY
Harrow, Thomas T.
THE TOUGHI0GHENY & OHIO COAL CO*
Brown, Robert Y.
255.00
•
104,288.76
104,286.76
1 0 4 , 2 8 8 .7 7
9 8 , 6 1 2 .3 4
95,000.00
10s, 757 .31
111 ,817.31
90,155.3 7
90,155,37
SAME OS' CORPORATION
a ND OSTI CEES OR
EMPLOYEES_____
CALENDAR OE
FISCAL YEAR
ENDED
SALARY
COMMISSION
-
BONUS
_________
OTHER
COMPENTOTAL
SAT ION_________ _
OKLAHOMA
CONTINENTAL OIL COMPANY
Moran, Pan
PHILLIPS PETROLEUM COMPANY
Phillips, Frank
WAEEEN PETROLEUM CORPORATION
Warren, W, K.
12/31/^0
12/31/40
100,000.00
100,000.00
,100.000.00
100,000.00
6/30/41
78 ,3 0 0 .0 0
78,3OO.OO
PENNSYLVANIA
ALUMINUM COMPANY OF AMERICA
Davis, Arthur V.
Hunt, Roy A.
ARMSTRONG CORK COMPANY
Prentis, E. W. , Jr.
BETHLEHEM STEEL COMPANY (DELAWARE)
Mackall, Paul
BETHLEHEM STEEL CO. (PENNSYLVANIA)
Grace, E. G.
»
McMath, R. E.
,
'•
Shrek, F. A.
Bent, Q.
Berkeley, Norborne
Larkin, J. M.
Holton, C. R.
Gross, J.-M.
.
Jacobs, M. L.
Cort, S. J.
Homer, A. B.
12/31/40
00
- 80,000,00
-Z.TSÎ * T T t
80,OOQ.00
12/31/40
1QÓ ,.0Q0.00
1 0 0 . 000 . 00
12/31/40
90,000.00
89.443.00
180,000.00
60,000.00
60,000.00
90,000.00
40.000. 00
298,144.00
79.506.00
79.506.00
59.443. 00
49.690.00
49.690.00
49.690.00
49.690.00
49.690.00
28.524.00
58.826.00
12/31/40
- • 40,000.00
50.000. 00
35.000. 00
40.000. 00
60,000,00
-37,500.00
Z£-SÖX- 0 6
r£
128,000.00
125.000.
- ¿ S / * SOT
00
~ogo “HZ
o+l/
/3T
0 - * l/ I f / 2 I
179.443.00
478,-144.00
139.506.00
139.SP6.00
179.443.00
89 ,690.00
89 ,690,00
99.690.00
84.690.00
89.690.00
88.524.00
96.326.00
^OO
j
t
i
a
r
v
«
î
v
i
o
o h o i o w
aniHn
s
l
t
e
l
o
ì
NAME 03F CORPORATION
AND OPPICERS OR
EMPLOYEES
CALENDAR OR
PISCAL YEAR
ENDED
44
SALARY
COMMISSION
BONUS
OTHER
COMPEN
SATION
total
PENNSYLVANIA (Con.)
CARNEGIE-ILLINOIS STEEL CORP.
.perry, J. L.
COPPERWELD STEEL COMPANY
Bramer, S. E,
PELS a ND COMPANY
Robson, A. Roy
HERSHEY CEOCOLa TE CORPORATION
Murrie, Wm. P* R.
JONES & LAÜGHLIN STEEL CORP’N.
Lewis, H. E.
- Parsons, L. M.
LEE RUBBER AND TIRE CORPORATION
Garthwaite, a * A.
- Garthwaite, A A.
LEEDS AND NORTHHUP COMPANY
Redding, C. S.
I Cary, C. R.
M c Cl o s k e y a n d c o m p a n y (De l a w a r e )
McCloskey, M. H . , Jr.
•THE MIDVALE COMPANY
Prevert, Harry L.
G. C. MURPHY COMPANY
‘ '
Mack, J. S.
Shaw, W. C.
national steel corporation
tfeir, Ernest T.
Pink, George R.
THE PENNSYLVANIA R a ILROAD COMPa NY
Clement. hL W.
12/31/40
85,000.00
130.00
12/31/40
25,000.00
io o ,i 4 o. 6 4
30,000.00
63,470.37
12/31/40
12/31/40
125,i 4o .64
9 3 . *+7 0 .3 7
91.550.00
9 1 , 5 5 0 .0 0
13/31/40
135,000.00
50,000.00
30,385.1^
1 3 5 , 0 0 0 .0 0
8 0 , 3 8 5 .1 4
39.999.96
60,000.00
9 9 . 9 9 9 .96
10/31/40
10/31/41
4 0 , 0 0 0 .0 0
3 5 , 6 9 0 .8 0
N
5/31/41
15.000.
12.000.
12/31/40
00
00
7 3 , ^ 5 .0 0
7 3 . ^ 5 .0 0
260,000.00
260,000.00
30,000.00
12/31/40
5 0 , 2 4 0 ,0 0
22,500.00
15,000.00
8^,031.91
63.023.93
31.250.00
62.500.00
60,000.00
13/31/^0
. 7 5 , 6 9 0 .8 0
■ 8 8 , 4 4 5 .0 0
8 5 , 4 4 5 .0 0
12/31/40
12/31/40
85,130.00
90,000.00
. 8 0 , 2 4 0 .0 0
106,531.91
. 7s.023.93
4 0 0 .0 0
. .300.00
121,650.00
1 2 2 , 8 0 0 .0 0
ifi
CALENDAR OR
FISCAL YEAR
ENDED
H äMB Of CORPORATION
AUD OffICERS OR
EMPLOYEES
SALARY
COMMISSION
OTHER
COMPEN
SATION
BONUS
TOTAL
PENNSYLVANIA (Con.)
12/31/^0
THE PHILADELPHIA NATIONAL BANK
Wayne, Jo sep h, Jr*
PITTSBURGH BUSINESS PROPERTIES, INC. 121^ 1 /kO
Hann, George R.
12/31/**0
PITTSBURGH PLATE GLASS COMPANY
Brown, Clarence M.
Wlierrett, H. S.
Higgins., H. B.
Clause, R* L.
9/30/^1
PLANTERS NUT AND CHOCOLATE COMPANY
Obici* A*
Peruzzi, M*
l/31/^l
JACOB SIEGEL COMPANY, INC.
Siegel, Jacob
12/3l /1+0
SMITE, KLINE, & ERENCH LABORATORIES
Kline, C. Mahlon
Royer, francis
12/311^0
TASTY BAKING COMPANY
Morris, H. C.
Baur, P. J.
12/31/to
THE UNITED GAS IMPROVEMENT CO.
Zimmermann, John E.
UNITED STATES STEEL CORPORATION Of
12/31/to
DELAWARE
fairless, B. f.
1 /31/to
. JOHN'WANAMAKER (PHILADELPHIA)
Shipley, C. R.
WESTINGHOUSS ELECTRIC & MnNUfACTURING
12/31/to
COMPANY
Robertson, A. W.
Bucher, George H.
<^>o£T
oo "
ÖO *“OOtT
-fero *
oo-ooo"09
00 *000•06
12,600.00
140.000.
50.000.
140.000.
140.000.
.
108,3142.00
8,3314.00
100,008.00
162,600.00
130,000.00
26.000.
39.000.
26.000.
26.000.
00
00
00
00
218,1416.76
88,517.62
5,000.00
7 ,500.00
146.500.00
00
146.500.00
00
3100
4.100.00
314.100.00
00
112,500.00
1400.00
1400.00
223,816.76
96,1417.62
135.500.00
100.100.00
100,100.00
90,000.00
90,000.00
86,1400.00
79,Î03.17
56,1400.00
51 ,603.17
30,000.00
27,500.00
92.772.
^8
92.772.
^8
92,772.^8
92,772**48
90,000.00
90,000.00
99,999.96
99,999.96
60,000.00
30,319.12
110,7^ 9.97
77.52^.97
51 .825.00
38.868.00
.
O O * O S 3 * TC
00
“ooo *St
00 “00 S*33
O+t/ T C / S T
90,319.12
2,050.00
2,050.00
R O I JLTTîO«MOO
1614.6214.97
118.14142.97
TSfffflliLS
TT^N-OX
-o
V» •a^o'OH
•«g *•N£
NAME 01 CORPORATION
AND OFFICERS OR
EMPLOYEES
CALENDAR OR
FISCAL YEAR
ENDED
SALARY
COMMISSION
BONUS
OTHER
COMPEN
SATION
TOTAL
TENNESSEE
COCA-COLA BOTTLING CO* (THOMAS), INC. 12/31/40
Hunter, Geo. T.
9s.335.62
* ' *J
TEXAS
ANDERSON, CLAYTON & CO.
Lamberth, A. H.
POLLOCK PAPER AND BOX COMPANY
Jacobs, Leslie L.
WEST PRODUCTION COMPANY
'West, J. M.
9s.335.62
7/31/^!
220,439.90
12/31/40
220.439.90
118.816.91
12/31/40
75.000.00
3 ,125.00
-78.125-00
VERMONT
CHICAGO STOCK YARDS COMPANY
Prince, Erederick H.
12/31/40
300,000.00
300,000.00
96,000.00
96,000.00
VIRGINIA
SKIPPY, INC.
Crosby, Percy L.
12/31/40
WEST VIRGINIA
STERLING PRODUCTS (INCORPORATED)
Weiss, W. E.
Diebold, A* H.
12/31/40
125.000.00
' 125,000.00
100.00
100.00
125,100.00
125,100.00
NAME 0? CORPORATION
and officers or
EMPLOYEES______
CALENDAR OR
FISCAL YEAR
ERRED
SALARY
COMISSION
OTHER
BONUS
C0MPENTOTAL
_______SATION_________
WEST VIRGINIA (Con.)
WEIRTON STEEL COMPANY
Weir, Ernest T.
12 /3 1 /1+0
30,000
93 ,750.00
123,75°•00
WISCONSIN
KIMBERLY-CLARK CORPORATION
Sensenbrenner, E. J.
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fOU &SLEÀSE, M Q M W Q N M S P A P M S ,
Prete Service
Fffiday» Septeaber 11, 1942.
Secreter/ of tbe fre&tury Morgenthau announeed last night tfeat
tfee aubscription booka for tèe carrent offering of 0.65 perecat fTeatiiry
Certificate» of Indebtedness of Serio* C-1943 and of 1-1/4 pereeat
freatory loto* of Serio» 6 4 H 5 «111 «loe» ai thè eloee of fratin+tm today,
Septeaber 11.
Sabscription» for «líber ittue addrested to o Federal Eeeerre
Bwdt, or Branch, or io thè f r e m e r Departeent, and placed la tbe
mt%
befare 12 o »clock laidnight Friday, Septeober 11, «111 be eonetéered a»
baviag been entered befare the «loe» of «he «ubscription books.
Announceaent of tèe aeount of etsbeeriptloiie and tbe batee of
aUotatat « m
probably be aade oa Wednetday, Septoaber 16,
€?
¿9
&
TREASURY DEPARTMENT
Washington
FOR RELEASE, H O M I N G NEWSPAPERS,
Friday, September 11, 1942«_____
Press Service
No* 33-22
Secretary of the Treasury Morgenthau announced last
night that the subscription books for the current offering
of 0*65 percent Treasury Certificates of Indebtedness of
Series C-1943 and of l~l/4 percent Treasury Notes of Series
C - 1945
will close at the close of business today, September 11.
Subscriptions for either issue addressed to a Federal
Reserve Bank, or Branch, or to the Treasury Department, and
placed in the mall before 12 o fclock midnight Friday,
September 11, will be considered as having been entered
before the close of the subscription books.
Announcement of the amount of subscriptions and the
bases of allotment will probably be made on Wednesday,
September 16.
-oOo-
appropriate and necessary under the provisions of this circular,
and under any instructions given by the Secretary of the Treasury,
3.
The Secretary of the Treasury may a.t any time or from time
to time supplement or amend the terms of this circular, or of any
amendments or supplements thereto, and may at any time or from time
to time prescribe amendatory rules and regulations governing the offering of the notes, information as to which will promptly be furnished
to the Federal Reserve Banks,
Henry Morgenthau, Jr,,
Secretary of the Treasury,
4.
Presentation and surrender«-
Notes bearing properly executed
requests for payment must be presented and surrendered to the agent that
issued the notes (as shown by the agent’s dating stamp), at the expense
and risk of the owner.
For the owner’s protection, notes should be for
warded by registered mail, if not presented in person,
5«
Disability or death,-
In case of the disability or death of
the owner, and the notes are not to be presented in payment of Federal
income, estate or gift taxes due from him or from his estate, instructions
should be obtainad -from the issuing agent before the request for payment
is executed, or the notes presented,
Partial redemption.-
Partial cash redemption of a note, correspond
ing to an authorized denomination, may be made in the sane manner as for full
cash redemption, appropriate changes being made in the request for payment.
In case of partial redemption of a note, the remainder will be reissued in
the same name and with the same date of issue as the note surrendered.
7,
Payment.- Payment of any note, either at maturity or on redemption
before maturity, will be made only by the Federal Reserve Bank or Branch, or
the Treasury Department, as the case may be, that issued the note, and will
be made by check drawn to the order of the owner, and mailed to the address
given in his request for payment.
VI.
1.
GENERAL PROVISIONS
Except as provided in this circular, the notes issued hereunder will
be subject to the general regulations of the Treasury Department, now or
hereafter prescribed, governing bonds and notes of the United States.
2.
Federal Reserve Banks and their Branches, as fiscal agents of the
United States, are authorized to perform such services or acts as may be
(b) Payment at maturity or on reelemption before maturity will
be made at par and accrued interest to the month of payment, except,
if a note is inscribed in the name of a
bank that accepts
demand deposits, payment at maturity or on redemption before maturity
will be made only at the Issue
price, oiA par, of the note.
However,
if a note is acquired by any such bank through forfeiture of a loan,
payment will be made at the redemption value for the month in which
so acquired.
2.
Execution of request for payment.-
The owner in whose name
the note is inscribed must appear before one of the officers authorized
by the Secretary of the Treasury to witness and certify requests for
payment, establish his identity, and in the presence of such officer
sign the request for payment appearing on the back of the note, adding
the address to which check is to be mailed.
After the request for
payment has been so signed, the witnessing officer should complete and
sign the certificate provided for hie use.
3*
Officers authorized to witness and certify requests for payment.-
All officers authorized to witness and certify requests for payment of
United States Savings Bonds, as set forth in Treasury Department Circular
No. 530, Fifth Revision, are hereby authorized to witness and certify
requests for cash redemption of Treasury notes issued under this circular.
Such officers include, among others, United States postmasters, certain
other post office officials, and the officers of all banks and trust
companies incorporated in the United States or its organized territories,
including officers at branches thereof.
TV,
1*
PROSTRATION IN PAY!TNT OF TAXES
During and after the second calendar month after the month
of purchase (as shown by the issue date on each note), during such
time, and under such rules and regulations as the Commissioner of
Internal Revenue, with the approval of the Secretary of the Treasury,
shall prescribe, notes issued hereunder in the name of a taxpayer
(individual, corporation, or other entity) may be presented and
surrendered by such taxpayer, his agent, or his estate, to the Collector
of Internal Revenue to whom the tax return is made, and will be re
ceivable by the Collector at par and accrued interest from the month
of issue to the month, inclusive (but no accrual beyond maturity),
in which presented, in payment of any Federal income taxes (current
and back personal and corporation taxes, and excess-profits taxes),
or any Federal estate or gift hpxes (current and back), assessed
against the original purchaser or his estate.
The notes must be
forwarded to the Collector at the risk and expense of the owner, and,
for the owner *s protection, should be forwarded by registered mail,
if not presented in person.
CASH REDEMPTION AT OR PRIOR TO MA.TURITY
1* 2f;nei,&1»- (a) ^uiy Treasury note of Tax Series C not presented
I
Payment of taxes, will be paid at maturity, or, at the option and re
quest of the owner, will be redeemed before maturity, but the notes may
be redeemed before maturity only during and after the sixth calendar
month after the month of issue (as shown on the face of each note), on
30 daysT advance notice.
The timely surrender of a note, bearing a
properly executed request for payment, will be accepted as constituting
the advance notice required hereunder.
-5his action in any such respect shall be final*
If an application is
rejected, in whole or in part, any payment received therefor will be
refunded.
The Secretary of the Treasury, in his discretion, may
designate agencies other than those herein provided for the sale of,
or for the handling of applications for, Treasury notes to be issued
hereunder*
3*
Delivery of notes*-
Upon acceptance of full-paid applications,
notes will be duly issued and, unless delivered in person, will be deliv
ered within the Continental United States, the Territories and Insular
Possessions of the United States, and the Qanal Zone,
No deliveries else
where will be made*
4.
Form of application*- In applying for notes under this circular,
care should be exercised to specify that notes of Tax Series C are desired,
and there must be furnished the name and address of the individual, corpora
tion, or other entity in which the notes are to be issued; and if address
for delivery of the notes is different, appropriate instructions should be
given.
The name should be in the same form as that used in the Federal tax
return of the purchaser, except that in the case of joint tax returns of
indiviauals, the notes should be inscribed individually - the notes will
not be issued in the names of two or more persons jointly.
The application
should be accompanied by remittance to cover the purchase price - that is,
par.
The use of an official application form is desirable, but not necessary*
Appropriate forms may be obtained on application to any Federal Reserve Bank
or Branch, or the Treasurer of the United States, Washington, D. C.; banking
institutions and security dealers generally will be supplied with forms for
the use of their customers*
-46,
Taxation»-
Income derived from the notes shall be subject to
all Federal taxes, now or hereafter imposed.
The notes shall be subject
to estate, inheritance, gift or other excise taxes, whether Federal or
State, but shall be exempt from all taxation now or hereafter imposed on
the principal or interest thereof by any State, or any of the possessions
of the United States, or by any local taxing authority.
III.
PURCHASE OF NOTES
1’ ¿Educations and payment.-
Applications will be received by
the Federal Reserve Banks and Branches, and by the Treasurer of the
ITniteu States, Washington, D. C,
Banking institutions and security
dealers generally may submit applications for account of customers, but
only the Federal Reserve Banks and the Treasury Department are authorized
to act as official agencies.
payment in full, at par.
Every application must be accompanied by
Any form of exchange, including personal checks,
will be accepted subject to collection, and should be drawn to the order
of the Federal Reserve Bank or of the Treasurer of the United States, as
payee, as the case may be.
The date funds are made available on collection
of exchange will govern the issue date of the notes.
Any depositary,
qualified pursuant to the provisions of Treasury Department Circular No. 92
(revised February 23, 1932, as supplemented) will be permitted to make pay
ment by credit for notes applied for on behalf of itself or its customers
up to any amount for which it shall be qualified in excess of existing deposi
2.
Reservations.- The Secretary of the Treasury reserves the right
to reject any application in whole or in part, and to refuse to issue or
permit to be issued hereunder any notes in any case or in any class or
classes of cases if he deems such action to be in the public interest, and
-3held by a corporation owning more than 50 percent of the stock, with
voting power, of another corporation, the notes may be transferred to
the subsidiary, upon request of the corporation and surrender of the
notes to the agent that issued them; and Provided further, if notes
pledged as collateral for a loan are acquired because of the failure
of a loan to bo paid, the notes will be redeemed at par and accrued
interest to the month in which acquired on surrender of the notes to
the agent that issued them, accompanied by proof of the date of
acquisition and by request of the pledgee under power of attorney given
by tho pledgor in whose name the notes are inscribed, and in any such
cases the limitations on redemption before maturity provided in paragraph
1(a) of Section V of this circular shall not apnly; the notes will not be
transferred to the pledgee.
The notes will not be acceptable to secure
deposits of public rftoney.
4.
Interest.-
Interest on. each $1,000 principal amount of notes
of Tax Series C will accrue each month from the month of issue, on a
graduated scale, as follows:
First to Sixth months, inclusive................ *$0.50 each month
Seventh to Twelfth months, inclusive.............
.80 »»
"
Thirteenth to Eighteenth months, inclusive............ 90 ”
"
Nineteenth to Twenty-Fourth months, inclusive.... . 1.00 «
"
Twenty-Fifth to Thirty-Sixth months, inclusive...., 1,10 "
0
5.
The table appended to this circular shows for notes of each denomina*’
tion, for each consecutive calendar month from month of issue to month of
maturity, (a) the amouiit of interest accrual, (b) the principal amount of the
note with accrued interest (cumulative) added, and (c) the approximate invest
ment yields.
In no case shall interest accrue beyond the month in which the
note is presented in payment of taxes, or fo r redemption b efo re m aturity as
provided in Section V of this circular, or beyond i t s m a tu rity .
be paid only with the principal amount.
Interest will j
t
f o r th e su rre n d e re d n o t e s : P r o v id e d , t h a t where l e s s th an $ 1 ,0 0 0 o f such
S e r i e s B -1 9 4 4 n o te s a r e so h e ld , th e y may be su rre n d e re d w ith th e ca s h
d if f e r e n c e t o be exchanged f o r a $ 1 ,0 0 0 S e r i e s C -1 9 4 5 n o te *
H .
1«
DESCRIPTION OF NOTES
G e n e ra l. - The n o te s o f Tax S e r i e s C w i l l ,
be d a te d a s o f th e f i r s t
in each i n s t a n c e ,
day o f t h e month in w hich paym ent, a t p a r ,
r e c e i v e d and c r e d i t e d by an a g e n t a u th o r iz e d t o
w i l l m ature 3 y e a r s from such d a t e ,
is s u e t h e n o te s *
is
They
and may n o t be c a l l e d by th e
S e c r e t a r y o f th e T re a s u ry f o r red em p tion b e f o r e m a t u r i t y .
A l l n o te s
is s u e d d u rin g any one c a le n d a r y e a r s h a l l c o n s t i t u t e a s e p a r a t e s e r i e s
in d i c a te d by th e l e t t e r ,fC" fo llo w e d by t h e y e a r o f m a t u r i t y .
t o th e p r o v i s io n s o f S e c t io n 1 7 o f t h i s c i r c u l a r ,
r e c e i v a b l e , a t p a r and a c c ru e d i n t e r e s t ,
e s ta te ,
and g i f t t a x e s .
S u b je c t
th e n o te s w i l l be
in payment o f F e d e r a l income,
I f n o t p re s e n te d in payment o f t a x e s ,
th e
n o te s w i l l be p a y a b le a t m a t u r i t y , o r , a t th e ow ner1s o p tio n and re q u e s t,
th e y w i l l be red eem ab le b e f o r e m a t u r i t y , s u b j e c t to t h e p r o v is io n s o f
S e c t io n 7 o f t h i s c i r c u l a r ,
2.
At th e tim e o f i s s u e ,
th e a u th o r iz e d i s s u in g a g e n t w i l l in s crib e
on th e f a c e o f each n o te th e name and a d d re ss o f th e ow ner, w i l l e n te r
th e d a te as o f w hich th e n o te i s
(w ith c u r r e n t d a t e ) .
is s u e d , and w i l l im p rin t h is d atin g stamp
The n o te s w i l l be is s u e d in d en o m in ation s o f $ 1 ,0 0 0 ,
$ 5 , 0 0 0 , $ 1 0 ,0 0 0 , $ 1 0 0 ,0 0 0 , $ 5 0 0 ,0 0 0 and $ 1 , 0 0 0 , 0 0 0 ,
E xch an g es o f a u th o rize d
d en om in ation s from h ig h e r t o lo w e r, b u t n o t from lo w er to h ig h e r may be
a rra n g e d a t t h e o f f i c e o f th e a g e n t t h a t is s u e d th e n o t e .
3.
The n o te s may n o t be t r a n s f e r r e d in o r d in a r y c o u r s e ;
th e y may be
p led g ed a s c o l l a t e r a l f o r lo a n s from banking i n s t i t u t i o n s , but no other
h y p o th e c a tio n w i l l be re c o g n iz e d by th e T re a s u ry D ep artm en t: P ro vid ed , if
Ô
U n ite d S t a t e s o f A m erica
TREASURY TAX SAVINGS NOTES
Tax S e r i e s C
Iss u e d a t P a r
Due 3 Y e a rs from is s u e Date
Redeem able B e fo re M a tu r ity a t O ption o f Owners
A cc e p ta b le a t P a r and A ccru ed I n t e r e s t in Payment o f F e d e r a l Incom e, E s t a t e ; and
G i f t T axes
1942
D epartm ent C i r c u l a r No. 696
TREASURY DEPARTMENT*
O f f ic e o f th e S e c r e t a r y ,
W ash in gton , Septem ber 1 2 , 1942,
F i s c a l S e r v ic e
B u reau o f th e P u b lic Debt
I.
1.
OFFERING OF NOTES
The S e c r e t a r y o f th e T r e a s u r y , p u rsu an t to t h e a u t h o r i t y o f th e
Second L i b e r t y Bond A c t, a s amended, o f f e r s f o r s a l e , to th e people o f the
U n ite d S t a t e s ,
a t p a r , an is s u e o f n o te s o f t h e U n ite d S t a t e s ,
T r e a s u ry N o tes o f T ax S e r i e s C, w hich n o te s ,
be r e c e i v a b l e ,
e s ta te ,
2.
a t p a r and a c c ru e d i n t e r e s t ,
d esig n a te d
a s h e r e i n a f t e r p ro v id ed , w ill
in payment o f F e d e r a l income,
and g i f t t a x e s .
The n o te s w i l l be p la c e d on s a l e Septem ber 1 4 ,
1 9 4 2 , and th e sale
w i i l c o n tin u e u n t i l te rm in a te d by th e S e c r e t a r y o f t h e T r e a s u r y .
3.
The s a l e o f T re a s u ry N o tes o f T ax S e r i e s B - 1 9 4 4 , p u rsu an t to Treasury
D epartm ent C i r c u l a r No. 6 7 4 , d a te d December 1 5 , 1 9 4 1 , w i l l te rm in a te a t the
c l o s e o f b u s in e s s on Septem ber 1 2 , 1 9 4 2 .
4.
jriny h o ld e r o f T re a s u ry n o te s ,
Tax S e r i e s B -1 9 4 4 , p u rch ased and bear
in g a d a te o f is s u e in Septem ber 1 9 4 2 , may s u rre n d e r such n o te s on or before
S eptem ber 3 0 , 1 9 4 2 , to th e ag en cy w hich is s u e d th e n o te s and r e c e i v e in ex*
change t h e r e f o r T re a s u ry n o t e s , Tax S e r i e s C -1 9 4 5 , o f l i k e f a c e amount
s c r ib e d in th e same name .and is s u e d a s o f th e f i r s t day o f Septem ber, 1942,
u
TREASURY NOTES— TAX SERIES A -1 9 4 5
P u rch a s e P r i c e and T ax-Paym ent V alue D uring S u c c e s s iv e Months
!
i
1
The t a b l e below shows th e p r i n c i p a l amount w ith a c c ru e d i n t e r e s t added
f o r n o te s o f e a c h d en o m in ation , f o r each month fro m Septem ber 1 9 4 2 to Septem
b e r 1945, in c lu s iv e .
The t o t a l shown f o r any den om in ation f o r any month while
th e n o te s rem ain on s a l e , i s t h e p u rch ase p r i c e , o r c o s t o f t h e n o te during
t h a t m6n th .
A lso th e t o t a l shown f o r any denom ination f o r .any month i s the
i
ta x -p a y m en t v a lu e o f t h e n o te i f r e c e i v a b l e during t h a t month in payment of taxes
1942:
Septem ber . . . . .
O cto b er . . . . . . .
November . . . . . .
December . . . . . .
1943;
J a n u a ry ................
F e b ru a ry . . . . . .
March .....................
A p r il .....................
May ..........................
Juno .......................
J u l y .......................
August ..................
Septem ber ...........
O cto b er ................
November . . . . . .
December .............
1944:
J a n u a ry . . ...........
F e b ru a ry . . . . . .
March .....................
A p r il . . . . . . ...........
May ..........................
Ju n e ........................
J u l y ..................... ..
August ..................
Septem ber ...........
O cto b er . . . . . . .
November .............
December . . . . . .
1945:
J a n u a rv . . . . . . .
F e b ru a ry . . . . . .
March .....................
A p r il .....................
May ..........................
Ju n e .......................
Ju ly . . . . . . . . . .
A u g u s t ............. ....
Septem ber . . . . .
£50
o
o
i—
i
£25
£*500
Cl,000
f>5,000
-------------------- — —
£ 2 5 .0 0
2 5 .0 4
2 5 .0 8
2 5 .1 2
£ 5 0 .0 0
5 0 .0 8
5 0 .1 6
5 0 .2 4
£ 100.00
2 5 .1 6
2 5 .2 0
2 5 .2 4
2 5 .2 8
2 5 .3 2
2 5 .3 6
2 5 .4 0
2 5 .4 4
2 5 .4 8
2 5 .5 2
2 5 .5 6
2 5 .6 0
5 0 .3 2
5 0 .4 0
50*48
5 0 .5 6
5 0 .6 4
5 0 .7 2
5 0 .8 0
5 0 ,8 8
5 0 ,9 6
51 ,.,04
51, 12
51., 20
1 0 0 .6 4
1 0 0 .8 0
1 0 0 .9 6
2 5 .6 4
25„68
2 5 .7 2
2 5 .7 6
2 5 .8 0
2 5 .8 4
2 5 .8 8
2 5 ,9 2
2 5 .9 6
2 6 .0 0
2 6 ,0 4
2 6 .0 8
5 1 .2 8
5 1 .3 6
5 1 .4 4
5 1 .5 2
5 1 .6 0
5 1 .6 8
5 1 .7 6
5 1 .8 4
5 1 .9 2
5 2 .0 0
5 2 .0 8
5 2 .1 6
2 6 .1 2
2 6 .1 6
2 6 .2 0
2 6 .2 4
2 6 .2 8
2 6 .3 2
2 6 .3 6
26 •40
2 6 .4 4
5 2 .2 4
5 2 .3 2
5 2 . 40
5 2 .4 8
5 2 .5 6
5 2 .6 4
5 2 .7 2
5 2 .8 0
5 2 .8 8
Al,000.000
1,001.60
1,003.20
1,004.80
C5,000
5,008
5,016
5,024
503.20
504.00
504.80
505.60
506.40
507.20
508.00
508.80
509,, 60
510.40
5I1.S0
512,-00
1,006.40
1,008.00
1,009.60
1,011.20
1,012.80
1,014.40
1,016,00
1,017.60
1,019.20
1,020.80
1,022.40
1,024.00
5,032
5,040
5,048
5,056
5,064
5,072
5,080
5,088
5,096
5,104
5,112
5,120
1 0 3 r 52
1 0 3 .6 8
1 0 3 .8 4
1 0 4 . 00
1 0 4 .1 6
1 0 4 .3 2
512.80
513.60
514.40
515.20
516.00
516.80
517.60
518.40
519.20
520.00
520.80
521.60
1,025.60
1,027.20
1,028*80
1,030.40
1,032,00
1,033.60
1,035.20
1,036.80
1,038.40
1,040.00
1,041.60
1,043.20
5,128
5,136
5,144
5,152
5,160
5,168
5,176
5,184
5,192
5,200
5,208
5,216
1 0 4 .4 8
1 0 4 .6 4
1 0 4 .8 0
1 0 4 .9 6
1 0 5 .1 2
1 0 5 .2 8
1 0 5 .4 4
1 0 5 .6 0
1 0 5 .7 6
5 2 2 .4 0
5 2 3 .2 0
5 2 4 .0 0
5 2 4 .8 0
5 2 5 .6 0
5 2 6 .4 0
5 2 7 .2 0
5 2 8 .0 0
5 2 8 .8 0
1 , 0 4 4 .8 0
1 , 0 4 6 .4 0
1 , 0 4 8 .0 0
1 ,0 4 9 .6 0
1 ,0 5 1 .2 0
1 , 0 5 2 .8 0
1 ,0 5 4 .4 0
1 , 0 5 6 .0 0
1 , 0 5 7 ;6 0
5 ,2 2 4
5 ,2 3 2
5 ,2 4 0
5 ,2 4 8
5 ,2 5 6
5 ,2 6 4
5 ,2 7 2
5,280
5,288
100.16
1 0 0 .3 2
1 0 0 .4 8
1 0 1.1 2
101c28
1 0 1 .4 4
1 0 1 .6 0
101*76
1 0 1 .9 2
1 0 2 -0 8
102«24
1 0 2 .4 0
102,: 56
1 0 2 .7 2
102.88
1 0 3 .0 4
1 0 3 .2 0
103c 36
£500.00
500.80
501.60
502.40
-------Jj
*
}
J j
-9VI.
1«
GENERAL PROVISIONS
Except as provided in this circular, the notes issued here
under will be subject to the general regulations of the Treasury De
partment, now or hereafter prescribed, governing bonds and notes of
the United States*
2.
Federal Reserve Banks and their Branches, as fiscal agents
of the United States, are authorized to perform such services or acts
as may be appropriate and necessary under the provisions of this
circular, and under any instructions g'iven by the Secretary of the
Treasury.
3.
The Secretary of the Treasury may at any time or from time to
time supplement or amend the terms of this circular, or of any amend
ments or supplements thereto, and may at any time or from time to time
prescribe amendatory rules and regulations governing the offering of
the notes, information as to which will promptly be furnished to the
Federal Reserve Banks.
Henry Morgenthau, Jr.,
Secretary of the Treasury.
-8
4* Presentation and surrender.-
Notes bearing properly
executed requests for payment must be presented and surrendered
to the agent that issued the notes (as shown by the agent's dating
Stamp), at the expense and risk of the owner.
For the owner's
protection, notes should be forwarded by registered mail, if not
presented in person*
5* Disability or death.-
In case of the disability or death
of the owner, and the notes are not to be presented in payment of
Federal income, estate or gift taxes due from him or from his estate,
instructions should be obtained from the issuing agent before the
request for payment is executed, or the notes presented.
6.
Partial redemption.- Partial cash redemption of notes
corresponding to an authorized denomination, may be made in the same
manner as for full cash redemption, appropriate changes being made in
the request for payment.
In case of partial redemption of a note,
the remainder will be reissued in the same name and with the same date
of issue as the note surrendered.
7.
Payment.-
Payment of any note, either at maturity or on redemp
tion before maturity, will be made only by the Federal Keserve Bank or
Branch, or the Treasury Department, as the case may be, that issued the
note, and will be made by check drawn to the order of the owner, and mail
to the address given in his request for payment.
In any case, payment
will be made at the purchase price of the note, that is, at par and
accrued interest (if any) paid at the time of ourehsse.
the same year»
The notes must be forwarded to the Collector at the risk
and expense of the owner, and, for the owner's protection, should be
forwarded by registered mail, if not presented in person.
V.
1,
General.-»
CASH REDEMPTION AT OR PRIOR TO MATURITY
Any Treasury Note of Tax Series A-1945, bearing
a properly executed request for payment, will be redeemed for cash
at the purcha.se price at or before maturity, without advance notice,
following presentation to the agent that issued the note.
2.
Execution of request for payment.-
The owner in whose name the
note is inscribed must anpear before one of the officers authorized by
the Secretary of the Treasury to witness and certify requests for payment,
l
establish his identity, and in the presence of such officer sign the request for payment appearing on the back of the note, adding the address
to which check is to be mailed.
After the request for payment has been
*
so signed, the witnessing officer shou&d complete and sign the certificate
provided for his use.
3.
Officers authorized to witness and certify requests for payment.-
All officers authorized to witness and certify requests for payment of
United States Savings Bonds, as set forth in Treasury Department Circular
No. 530, Fifth Revision, are hereby authorized to witness and certify re
quests for cash redemption of Treasury notes issued under this circular.
Such officers include, among others, United States postmasters, certain other
post office officials, and the officers of all banks and trust companies
incorporated in the United States or its organized territories, including
officers at branches thereof
(
-
61
may be obtained on application to any Federal Reserve Bank or Branch,
or the Treasurer of the United States, Washington, D. C,; banking
institutions and security dealers generally will be supplied with
forms for the use of their customers.
IV.
1*
PRESENTATION IN PAYMENT OF TAXES
During and after the second calendar month after the month of
purchase (as shown by the issuing agent's dating stamp on each note),
during such time, and under such rules and regulations as the Commissioner
of Internal Revenue, with the approval of the Secretary of the Treasury,
shall prescribe, notes issued hereunder in the name of a taxpayer
(individual, corporation, or other entity) may be presented and surrendered, j
to the extent hereinafter set forth, by such taxpayer, his agent, or his
estate, to the Collector of Internal Revenue to whom the tax return is made, i
and will be receivable by the Collector at par and accrued interest from
September 1942, to the month, inclusive (but no accrual beyond September
1945), in which presented in payment of any Federal income taxes (current
and back personal and corporation taxes, and excess—profits taxes), or any
Fedei*l estate or gift taxes (current and back), assessed against the
original purchaser or his estate.
Notwithstanding the provisions of Depart
ment Circular No. 667, as amended, and of Department Circular No, 674, the
Collector will accept (a) not more than $5,000 principal amount of notes of i
\
Tax Series A-1945, or of Tax Series A-1943, or of Tax Series A-1944, or of m
of them in combination, and (b) the amount of the accrued interest thereon,
on account of any one taxpayer’s liability for each class of taxes (incom e,
I
estate or gift) for each taxable period: Provided, Tha.t this limitation shall
apply separately to husband and wife on a joint return, and shall apply
separately to an owner before death and to his estate for the balance of
in whole or in part, any payment received therefor will be re
funded.
The Secretary of the Treasury, in his discretion, may
designate agencies other than those herein provided for the sale
of, or for the handling of applications for, Treasury notes to be
issued hereunder.
3*
Delivery of notes.-
Upon acceptance of full-paid applica
tions, notes will be duly issued and, unless delivered in person,
will be delivered within the Continental United States, the Terri
tories and Insular Possessions of the United States, and the Canal
Zone.
No deliveries elsewhere will be made.
4«
Form of application.-
In applying for notes under this
circular, care should be exercised to specify that notes of Tax Series
A-1945 are desired, and there must be furnished the name and address
of the individual, corporation, or other entity in which the notes
are to be issued; and if address for the delivery of the notes is
different, appropriate instructions should be given.
The name should
be in the same form as that used in the Federal tax return of the
purchaser, except that in the case of joint tax returns of individuals,
the notes should be inscribed individually— the notes will not be
issued in the names of two or more persons jointly.
The application
should be accompanied by remittance to cover the purchase, price— that
is, par— together with accrued interest from September 1942 to the
month in which the application will be received and the remittance
collected by an authorized issuing agent.
The use of an official
application form is desirable, but not necessary.
Appropriate forms
Ill*
1*
PURCHASE OF NOTES
Applications and payment.-
Applications will bo received by
the Federal Reserve Banks and Branches, and by the Treasurer of the
United States, Washington, D. C.
Banking institutions and security
dealers generally may submit applications for account of customers,
but only tho Federal Reserve Banks and the Treasury Department are
authorized to act as official agencies.
Every application must be
accompanied by payment in full, at par and accrued interest from
September 1942 to the month in which payment in immediately available
funds is received by a Federal Reserve Bank or 'Branch, or the Treasurer
of the United States.
Any form of exchange, including personal checks,
will be accepted subject to collection, and should be drawn to the
order of the Federal Reserve Bank or of the Treasurer of the United
States, as payee, as the case may be; War Savings Stamps will be
accepted at their face value in lieu of cash.
The date funds are made
available on collection of exchange will govern the issue price and issue
date of the notes.
Any depositary, qualified pursuant to tho provisions
of Treasury Department Circular No. 92 (revised February 23, 1932, as
supplemented) will be permitted to make payment by credit for notes
applied for on behalf of itself or its customers up to any amount for
which it shall be qualified in excess of existing deposits.
Reservations.-
The Secretary of the Treasury reserves the right
to reject any application in whole or in part, and to refuse to issue or
permit to be issued hereunder any notes in any case or in any class or
classes of cases if he deems such action to be in the public interest, and
his action in any such respect shall be fihal.
If an
application is rejected,
-33*
Denominations and interest.-
The notes will be issued in
denominations of #25, #50, #100, #500, #1,000, and #5,000, and interest
thereon will accrue from September 1942, in the amount of 16 cents
each month on each #100 principal amount of note.
In no esse, however,
shall interest accrue beyond the month in which the note is presented
in payment of taxes, or beyond its maturity.
Exchanges of authorized
denominations from higher to lower, but not from lower to higher, may
he arranged at the office of the agent that issued the note.
Purchase price and tax-payment value.-
A table is appended to
this circular showing the principal amount with accrued interest added,
for notes of each denomination, for each month from Sentember 1942 to
September 1945, inclusive.
The total shown for any denomination for
any month while the notes remain on sale, is the purchase price, or cost,
of the note during that month.
Also, the total shown for any denomination
for any month is the tax-payment value of the note if receivable during
that month in payment of taxes, subject to the provisions of Section TV
of this circular,
5* Taxation.-
Income derived from the notes shall be subject to
all Federal taxes, now or hereafter imposed.
The notes shall be subject
to estate, inheritance, gift or other excise taxes, whether Federal or
State, but shall be exempt from all taxation now or hereafter imposed on
the principal or interest thereof by any State, or any of the possessions
of the United States, or by any local taxing authority.
-
II,
1.
General,-
2-
DESCRIPTION OF NOrrES
The notes will be dated September 1, 1942; they will
mature September 1, 1945, and may not be called by the Secretary of the
Treasury for redemption before maturity.
Subject to the limitations and
conditions set forth in Section IF of this circular, the notes will be
receivable, at par and accrued interest, in payment of Federal income,
estate, and gift taxes.
If the notes are not presented in payment of
taxes, they will be payable at maturity, or, at the owncr^s option and
request, they will be redeemable before maturity, as provided in Section Y
of this circular, but in either case payment will be made only at the
price paid for the notes,
2.
Form, inscription, dating.»- The owner’s name and address will
be entered on each note at the time of its issue
by an authorized issu
ing agent, and the date of issue will be shown by an imprint of the
agent’s dating stamp.
The month in which payment is received and credited
by a&Federal Reserve Bank or Branch, or by the Treasurer of the United
States, will determine the purchase price and issue date of each note.
The notes may not be transferred, except, that if notes are held by a
corporation owning more than 50 percent of the stock, with voting power,
of another corporation, such notes may be transferred to the subsidiary
upon request of the corporation and surrender of the notes to the agent
that issued them.
No hypothecation of the notes on any account will be
recognized by the Treasury Department and they will not be accepted to
secure deposits of public money
United States of America
TREASURY TAX SAVINGS NOTES
Tax Series A-1945
Dated September 1, 1942
i
I
Due September 1, 1945
Issued at Par and Accrued Interest
Acceptable at Par and Accrued Interest in Payment of Federal Income, Estate, and
Gift Taxes
1942
Department Circular No* 695
---Fiscal Service
Bureau of the Public Debt
I.
1*
TREASURY DEPARTMENT
Office of the Secretary,
Washington, September 12, 19.42,1
OFFERING OF NOTES
The Secretary of the Treasury, pursuant to the authority.of the
Second Liberty Bond Act, as amended, offers for sale, to the people of the
%
United States, at par and accrued interest, an issue of nontransferable
notes of the United States, designated Treasury Notes of Tax Series A-I945
'
i
which notes, as hereinafter provided, will be receivable, at par and
accrued interest, in payment of Federal income, estate, and gift taxes.
2.
The notes will be placed on sale September 14, 1942, and the sale
will continue until terminated by the Secretary of the Treasury*
3.
The sale of Treasury Notes of Tax Series A-1944, pursuant to Treasury j
Department Circular No. 674, dated December 15, 1941, will terminate at the
j
close of business on September 12, 1942.
4,
nny holder of a Treasury note, Tax Series A.-*1944, purchased and
bearing a date of issue in September 1942, may surrender such note on or
before October 31, 1942, to the agency which issued the note and receive in
l
exchange therefor a Treasury note, Tax Series A-1945, of like face amount
inscribed in the same name and bearing the same date of issue, together
with a refund of the accrued interest included in the price paid for the
surrendered note
(
-3Periods after
month of issue
_____
Interest accrual
each month, per ■■ljOOO
First 1/2 year ,
..... ,
1/2 to 1 year ............
1 to 1 -1/2 years ..........
11/2 to 2 years .. ..
2 to 2-1/2 years .........
2-
1/2 to 3 years ..........
$0150
0.80
0.90
1.00
$1,000 principal with
interest accrual (cumu
lative) to end of
period added
....
.. i... ii4*.. *^*
......4¿4*..4i.
....... * •• ••iÌ
1 .1 0
............. .
1 *10
.............
$1,003.00
1,007*80
1,013.20
1,019.20
1 025^80
1,032.40
,
If not presented in payment of taxes, and except for those in the names of
...banks that accept demand deposits, the notes of Tax Series C will be
redeemable at par and accrued interest, either at maturity or, on 30 days' ad*.
I T ®
H
n°tlCe’ dUrine * a | f 6r the sisth calendar month after the month of issue.
inscribed in the name of &
• *■ v Q_i, 4., .
,
bank that accepts demand deposits, the
notes will be accepted at par and accrued interest in payment of taxes, but re
deemed for cash at or before maturity only at the purchase price, or par.
The
notes of this series may be pledged With banking institutions as collateral for
loans but no other hypothecation will be recognized by the Treasury Department.
The new Treasury Tax Savings Notes, like those of prior series, will be
issued only by the Federal Reserve Banks and Branches, and the Treasury Department, Washington,
The Official circulars, giving full particulars regarding the notes of the
{
new series, follow:
4\
taxpayers and other investors desiring to purchase these notes.
The notes of Tax Series A-k-1945, like thosp of prior Series A notes,
are intended primarily for the smaller taxpayer.
The new notes will be dated
September 1, 1942, and will mature September 1* 1945, thus providing a maturity
of three rather than two years from issue date.
The limitation on the princi
pal amount that may be presented on account of any one taxpayers liability
for each class of taxes (income, estate or gift) for each taxable period has
been raised from £1,200 to "5,000.
The new limitation will also apply to prior
Tax Series ¿-1943 and A-1944, or to any combination of the three series.
In
other respects the terms of notes of Tax Series A-1945 remain the same as those
of A-1944.
Interest will accrue (from September 1942) at the rate of 16 cents
per month per :-TOO, equivalent to a yield of approximately 1.92 percent per
annum.
The notes will be issued at par and accrued interest.
If not presented I
in payment of taxes, the notes will be redeemed at the purchase price only,
either at or before maturity, without advance notice.
The notes will be avail- I
able in the denominations of £25, A50, £100, £500, £1,000 and £5,000.
The new notes of Tax Series C will be dated as of the first day of the
month in which purchased, will mature three years thereafter, and they will
be issued at par.
Interest on the notes will accrue each month from month of <
issue, on a graduated scale, the equivalent yield if held to maturity being
approximately 1,0? percent per annum.
The amount of a.ccrual ea.ch month on
each vljOOO principal amount of notes, from month of issue to month of maturity!
follows:
1
TREASURY DEP/iOTffiMT
Washington
■
I R
FOR;RELEASE, M ® P « } NEWSPAPERS,
Y, September 14, 1942.
'
,
P
\ y /XjlsO ^
•
^
3 3
3
Secretary Morgenthau today announced changes in the terms of the Treasury
/
Tax Savings Notes, which have been on sale since August 1, 1941, for the con
venience of taxpayers and which are receivable at par and accrued interest in
payment of Federal income, estate, and gift taxes,
i
The changes arc effective in new Treasury Notes of Tax Series A-1945 and
Tax Series C-1945, which will be offered for sale beginning September 14, al
though the new notes will not be ready for delivery before the latter part of
the month.
The notes of Tax Series A-1944 and Tax Series B-1944, which have
been available since January 1,1942, were withdrawn from sale at the close of
\business September 12, 1942.
The new notes of Tax Series C are adaptable for dual purposes: (1) for the
accumulation of tax reserves and (2) for the temporary or short-term investment
of cash balances which are at present idle.
This new series of Treasury Notes,
the Secretary said, will furnish a security well adapted to corporations and
other investors for the mobilization of their idle funds for the War program.
'X The new terms provide greater flexibility, and, through provision for cash re
demption with interest, permit holders of Tax Series C notes to realize on the
notes without loss of interest.
Members of the Victory Fund Committees in the twelve Federal Reserve Dis
tricts, with a trained securities sales personnel, will participate actively
in the sale of the new Tax Savings Notes.
Each Federal Reserve District Com
mittee is headed by the President of the Federal Reserve Bank of the District.
Members of Victory Fund Committees, as well as bankers and securities Salesmen
generally, will have complete information and application forms and will assist
TREASURY DEPARTMENT
Washington
Press Service
FOR RELEASE, MORNING NEWSPAPERS, Monday
September 14» 1942.
9/ 1 1 / 42 ,
No
Secretary?" Morgenthau today announced changes m
33-23
the terms
of the Treasury Tax Savings Notes, which have been on sale
since August 1, 1941, for the convenience of taxpayers and
.vable at par and accrued interest in payment of
which are receiFederal income
ate, md gift taxesi
The changes are effective in new Treasury Notes of Tax
Series A-1945 and Tax Series C-1945, which will oe offered for
sale beginning September 14, although the new notes will nou
hp rpadv for -delivery before the latter part of the month. The
notes of Tax SerllsA-1944 and Tax Series B-1944, which have
I
1U available since January been
1, --194^, were withdrawn from sale
at the close of business September 12 1942.
The new notes of Tax Series C are adaptable for dual purnoses: (1) for the accumulation of tax reserves and (2) Jor
the temporary or short-term investment of cash balances which
are at present idle. This new series of Treasury Notes, the
Secretary said, will furnish a security well adapted to corpor
ations and other investors for the mobilizauion of their :
^
funds for the War program. The new terms provide greater i ^
ibility, and, through provision for cash redemption with inter
est, permit holders of Tax Series C notes to realize on the
notes without loss of interest.
Members of the Victory Fund Committees in the twelve Federal Reserve Districts, with a trained secur:ities sai^ Per
sonnel, will participate actively m the sale of V ® n e w lax
Savings Hotes. Each Federal Reserve District Committee is
headed by the President of the ^Federal Reserve Bank of the Dis
trict. Members of Victory Fund Committees, as wel
SMK|V*
and securities salesmen generally, will have complete infor
tion and application forms and will assist taxpayers and other
investors desiring to purchase these no es
•
4-
- 2 -
The notes of Tax Series A-1945, likc "those of p r i o r Sejj-®s
v,A+0q nTP intended primarily for the smaller taxpayer. The
new notes will be dated September 1, 1942, and will mature Sep
tember 1, 1945, thus providing a maturity of three rather tha
two years from issue date. The limitation on the principal
amounfthat may be presented on account of any onetaxpayer-s
liability for each class of taxes (income, estebe or gift) The
each taxable period has been raised from $1,200 to J^OOO.
new limitation will also apply to prior Tax Series
A-1944 or to any combination of the three senes.
,,
respects°theterms of notes of Tax Series A - 1 9 4 5 remain the
same as those of A-1944. Interest will accrueo^eauivalent
1942) at the rate of 16 cents per month per $100, equivalent
to a yield of approximately 1.92 percent per annum. The^notes
will be issued at par and accrued interest. If n
P
in payment of taxes, the notes will be redeemed a||ffae pur
r,y,aL ’'’irice only, either at or before maturity, without ad
vance Notice! The notes will be available in the denominations
of $25, $ 50 , $100, $ 500, $1,000 and $5,000.
a
The new notes of Tax Series C will be dated as of the
first day of the month in which purchased, will i
*5;?'3
t h v s thereafter, and they will be issued at par. Interest on
the notes will accrue each month from ““^ h d ^ m t u r i t y h e graduated scale, the equivalent yield if ^ l d to
»rrrvrnximatelv 1.07 percent per annum. The amount 01 ac
crual^each^onth on each $ 1 ,000" principal amount of notes, from
month of issue to month of maturity, follows:
Half-year Periods after
month of issue
Interest accrual
each month per
§ 1.000
§1,000 principal
with interest ac
crual (cumulative)
to end of period
added
....... .__
First 1/2 year *
1/2 to 1 year ..
1 to 1-1/2 years
11/2 to years
2
2 to 2-1/2 years
21/2 toyears
3
$ 0.50 .............
n ro ...... ...
0 P O .... . ,___
1 00 ___ _ .«.....
1 10 .......
1 . 1 0 ..... .___
$1 ,003.00
1,007.80
1 ,013.20
1 ,019.20
1,025.80
1,032.40
If not presented m payment of taxes, and except for those in
banks that accept demand deposits, the notes of
the names of
o
at par and accrued interest,
Tax Series C will be redeemable
on
30
days’
advance notice,^during ana
either at maturity or, on month after the month of issue. If
after the sixth calendar
U K that accepts demand deposits,
inscribed in the name of
n
h
"hay* and accrued interest m pay. par
the notes will be accep ea
at or before maturity only
ment of taxes, but redeemed 'or cash
- 3 -
at the purchase price, or par. The notes of this series may be
pledged with banking institutions as collateral for loans but
no other hypothecation will be recognized by the Treasury
Department.
The new Treasury Tax Savings Notes, like those of prior
series, will be issued only by* the Federal. Reserve Banks and
Branches, and the Treasury Department, Washington*
The official circulars, giving full particulars regarding
the notes of the new series, follow:
United States of America
TREASURY TAX SAVINGS NOTES
Tax Series A-1945
Dated September 1, 1942
Due September 1, 1945
Issued at Par and Accrued Interest
Acceptable at Par and Accrued Interest in Payment of Federal Income, Estate,
and Gift Taxes
1942
Department Circular No, 695
TREASURY DEPARTMENT,
Office of the Secretary,
Washington, September 12, 1942,
Fiscal Service
Bureau of the Public Debt
I.
OFFERING OF NOTES
1. The Secretary of the Treasury, pursuant to the authority of the
Second Liberty Bond Act, as amended, offers forsale, to t e
United States, at oar and accrued interest, an issue of n
' ,
notes of the United States, designated Treasury Kotos of Tax Series A-1945,
: £ c h notest as hereinafter provided, will be receivable, at par and accrued
interest, inpayment of Federal income, estate, and gift taxes.
3. The notes will be placed on sale September 14 > 1942> f,nd the 8nle
will continue until terminated by the Secretary of the Treasury.
3. The sale of Treasury Kotos of Tax
\ o^wni^er
Treasury Department Circular Ho. 674, dated December 15, 1941, will
minate at the close of business on September 12, 19.-2.
4. Any holder of a. Treasury note. Tax Series A-1944,
bearing a date of issue in September 1942, may surrender such note on <or
■
fore October 31, 1942, to the agency which_issued the note
exchange therefor a Treasury note, Tax ^ riesA ' ^ . ® ’ f , ue together with
inscribed in the same name and bearing the same drt
a refund of the accrued interest included in the price paid for the surrendered note.
II.
DESCRIPTION OF NOTES
X. general. - The notes will be * * & * f ^ g
mature September 1. 1945, and may not be
J K J timitation, and
Treasury for redemption before “ 4 ^ t u s circular, the notes will be re
conditions set forth in Section
t of podoral income, estate,
ceivable, at par and accrued interest, in
ym
— 3 —>
and gift taxes# If the notes are not presented in payment of taxes» %h&?
will be payable at maturity, or* at the owner*» option and request, they
will he redeemable before maturity, as provided in Section V of this circus
lar, hut in either case payment will he made only at the price paid for the
notea*
3.
Form, inscription, dating - The owner*s name and address will he
entered on each note at the tine of its issue by an authorized issuing
agent, and the date of issue will he shown by an imprint of the agent s
dating stamp. The month in which payment is received and credited by a F e& r
eral Reserve Bank or Branch, or by the Treasurer of the United States, will
determine the purchase price and issue date of each note# The notes may no
be transferred, except, that if notes are held by a corporation owning more
than 50 percent of the stock, with voting power, of another corporation,
such notes may be transferred to the subsidiary upon request of the corpor
ation and surrender of the notes to the agent that issued them, No hypo
thecation of the notes on any account will be recognized by the Treasury
Department and they will not he accepted to secure deposits o. public money.
3, Denominations and interest# m The notes will he issued in denomi
nations of $25, $50, $100, $500, $1,000, and $5,000, and interest thereon
will accrue from September 1942, in the amount of 16 cents each month on
each $100 principal amount of note# In no case, however, shall interest ac
crue beyond the month in which the note is presented in payment of taxes, or
beyond its maturity, Exchanges of authorized denominations from higher o
lower, but not from lower to higher, may be arranged at the office of the
agent that issued the note,
4, P 11rehs.se urlcs and tax-uavr'.pnt value. - A table is appended to this
circular showing the principal amount with accrued interest added, for notes
of each denomination* for each month from September 1942 to September 1
.
inclusive. The total shown for any denomination for any month while the
notes remain on sale, is the nureha.se nriee. or cost, of the note during
that month. Also, the total shown for any denomination for any month is the
tax-payment value of the note if receivable during that month in payment of
tares, subject to the provision* of Section IV of this circular.
5, Taxation, a Income derived from the notes shall be subject to all
federal taxes, now or hereafter imoosed* The notes shall J*®
st„testate, inheritance, gift or other excise taxes, whether ^«ra.l or SV.te.
but shall be exempt from all taxation now or hereafter imposed on the prin
cipal or interest thereof by any State, or any of the possessions of the
United States, or by any local taxing authority,
III#
PURCHASE OF NOTES
1.
Applications and payment, - Applications will be
Federal Reserve Buries and Branches, and by the Treasurer of ^ e United
States. Washington, D# C. Banking institutions and security aea ers gen
erally may submit applications for account of customers, but onlj tne
- 3 ~
F ed eral R eserve Banks and the Treasury Department ere
official nancies. E very application mast Be accompanied By P ^ ^ l n
full,
S S i ~
i
r=
B e T c ^ t e d ^ e c t to r n e f ion » d should
Be drawn to the order of the federal Reserve Bank or of the T r e a s u r e r ^
the United States, as payee, as the case may B*}_ft*
accepted at their face value in lieu of cash. The date f
,
available on collection of exchange will govern the issue price p
f
dlfe of theVotes, Any depositary, qualified Pursuant to
Treasury Department Circular Bo, 98 (revised M w r S .1932, £ «upple
mented) will Be permitted to make payment By credit f°r notes fS>pl _ *
on Behalf of itself or its customers u p to any amount for which it sha.ll Be
qualified in excess of existing deposits,
9. Reservations. - The Secretary of the Treasury reserves the right
to reject any 5
» «
in whole or inpart.
to refuse ^
>0 issue or
permit to Be issued hereunder any notes in any ca.se or
°r
.
cllsses of cases if he deems such action to Be in the pu B U c interest, and
his action in any such respect shall Be final. If a n a p o
refunded,
iacted, in whole or in part, any payment received therefor wil
The Secretarv of the Treasury, in his discretion, may designate agencies
other than those herein provided for the sale of. or for the handling of applications for, Treasury notes to be issued hereunder,
a.
Delivery of notes. - Upon acceptance of full-paid applications,
notes will Be duly i s l and, unless t o l l « » - J* P « Z * W a r Po^sel!
within the Continental United States, the Territories and Insular Posses
sions of the United States, and the Canal Zone. Ho deliveries elsewhere
will be made,
Form of application. - In applying for notes under thisciroular,
care should Be exercised to specify that notes of Tam S® £ 8® ^ X i t a a l
sired, and there must Be furnished the name and address of ^
corporation, or other entity in which the notes are to Be i s s u e d a n
address for the delivery of the notes is different,
ln
tions should Be given. The name should Be in the same form as that used^in
the federal tarn return of the purchaser, except that in
*,?
th
tax returns of individuals, the notes should Be inscriBed indlvitolly~the
notes will not Be issued in the names of two or “Ore parsons j P *
application should be accompanied by remittance to cover thepurcna
price--that is. par-together with accrued interest from SeptomBer^948 tc
the month in which the application will Be received and the
{acted hV an authorised issuing agent. The use of an
application
o f f i c i a l
S ^ t ^ t f 1
^
Eederal
o ^ X a s u r e r
United States Washington. B. C.i Banking
generally will be su p p lied with forms for tne uso ox
of'the
Z Z n Z sT
- 4 -
17.
PRESENTATION IV PAYMENT 07 TAXES
During and after the second calendar month after the month of purehase (as shown by the issuing agent's dating staro on each note), during
such time, and under such rules and regulations as the Commissioner , In
ternal Revenue, with the annroval of the Secretary of the
g«*
prescribe, notes issued hereunder in the name of ft taxpayer (individual,
corporation, or other entity) may he uresented and surrendered, to the ex
tent hereinafter set forth, hy such taxpayer, his agent, or his *
the Collector of Internal Revenue to whom the tax return is •
> .
he receivable hy the Collector at par and accrued interest from Sent, e
1 P A 2 , to the month, inclusive (hut no accrual beyond September 19-5),
which presented in payment of any Federal income taxes
^
T><=rsonp1 and corporation taxes, and excess-profits taxes), or any ■ _
estate or gift taxes (current and hack), assessed against tee original pur-^
chas=r or his estate. Notwithstanding the provisions of Department Circu
No. 567, as amended, and of Department Circular Ho. 674, the Collector U.
accent (a) rot more than $5,000 principal amount of notes of Tax Series
2 ^ 5
or of fax Series L l s ^ . or of Tax Series A-1944, or of any of them
in combination, and (h) the amount of the accrued i
n
t
&
count of any one taxpayer's liability for each cla
,
limitation
estate or gift) for each taxable period; Provided. That this
shall apply separately to husband and wife on a Joint return, and h
.
ply separately to an owner before death ana to
risk
of the same year. The notes most be forwarded to the
f * » ™
and expense of the owner, and, for the owner’s protection, should be for
warded by registered mail, if not presented in parson.
1.
V.
CASH REDEMPTIOF AT OR PRIOR TO MATURITY
1
General. - Any Treasury Kote of Tax Series A-1945, bearing a prop
erly executed~request for payment, will be redeemed for cashat
pur' chase price at or before maturity, without advance notice, following p
sentation to the agent that issued the note.
2 .
of request for payment. - The owner in
note is inscribed must appear before one of the officers author!*.
7
Secretary of the Treasury to witness « “ 4 “erti^requests
r^ est
tablish his identity, and in
adSress to which
chracP
kTTo
reauea^for payment has been so signed
the witnessing officer should Complete and sign the certificate provided
for his use.
,
________ to w i t n ess and certify requests for poyrngnj.
All officers authorized to ’'“ «ess « £ ^
^
^
““^ s ^ a r t ^ T c i r c u l a r
- 5 -
other post office officials, and the officers of all "banks a<nd trust compa.—
nies incomorated in the United Sta/tes or its organized territories, in
cluding officers at "branches thereof,
4 . Presentation and surrender. - Notes "bearing -properly executed re
quests for -payment must "be -presented and surrendered to the agent that is
sued the notes (as shown by the agent’s da.ting stam-p), at the expense and
risk of the owner. For the owner’s protection, notes should "be forwarded
"bv registered mail, if not presented in person.
5. Disability or death. - In case of the disability or death of the
owner, and the notes are not to be presented in payment of Federal income,
estate or gift taxes due from him or from his estate, instructions should
be obtained from the issuing agent before the request for payment is ex
ecuted, or the notes presented.
6. Partial redemption. - Partial cash redemption of notes correspond
ing to an authorized denomination, may be made in the same manner as for
full cash redemption, appropriate changes being made in the request for
payment. In case of partial redemption of a note, the remainder will be
reissued in the same name and with the same date of issue a.s the note sur
rendered.
7 . Payment. - Payment of any note, either at maturity or on redemp
tion before maturity, will be made only by the Federal Reserve Bank or
Branch, or the Treasury Department, as the case may be, that issued the note,
and will be made by check drawn to the order of the owner, and mailed to the
address given in his request for payment. In any case, payment will be made
at the purchase price of the note, that is, at par and accrued interest (if
any) paid at the time of purchase.
VI.
GENERAL PROVISIONS
1 . Except as provided in this circular, the notes issued hereunder
will be subject to the general regulations of the Treasury Department, now
or hereafter prescribed, governing bonds and notes of the United States.
2. Federal Reserve Banks and their Branches, a,s fiscal agents of the
United States, are authorized to perform such services or acts as may be
appropriate and necessary under the provisions of this circular, and under
any instructions given by the Secretary of the Treasury.
3. The Secretary of the Treasury may at any time or from time to time
supplement or amend the terms of this circular, or of any amendments or sup
plements thereto, and may at any time or from time to time prescribe amend
atory rules and regulations governing the offering of the notes, information
as to which will promptly be furnished to the Federal Reserve Banks.
Henry Morgenthau, Jr.,
Secretary of the Treasury.
TREASURY NOTHS— TAX SFRIFS A-1945
Purchase Price and Tax-Payment Yalue During Successive Months
The table below shows the principal amount with accrued interest added,
for notes of each denomination, for each month from September 1942 to Septem
ber 1945, inclusive. The total shown for any denomination for any'month while
the notes remain on sale, is the purchase price, or cost of the note during
that month. Also the total shown for any denomination for any month is the
tax-payment value of the note if receivable during that month in payment of
taxes.
$25
1942:
September .... $25.00
Octo't%r.... . 25.04
November ....» 25.08
December ..... 25.12
1943:
J anuary ...... 25.16
February ..... 25.20
March ........ 25.24
25.28
April .......
25*32
May
June ..••••••• 25.36
July •..... . • 25.40
August ••••••* 25,4^
September .... 25.^8
October .... . 25.52
November ..... 25.56
December •••.. 25.60
1944:
J anuary ...... 35.64
February ...•. 25.68
March ........ 25.72
25.76
April
25.80
May .......
June ......... 25.84
25.88
July
25.92
August ......
September .... 25.96
October •••••• 26.00
November ••••• 26.04
December ••••• 26.08
1945:
J anuary .••••» 26.12
February •.. •. 26.16
M a r c h .... . •. 26.20
26.24
April
May •..••.««»• 26.28
June ......... 26.32
J u l y ....... . 25.36
26.40
August
September •
*•*•
♦#• 26.44
$50
$100
$500
$1,000
$5,000
$50.00
50.08
50.16
50.24
$100.00
100.16
100.32
100.48
$500.00
500.80
501.60
502.40
$1,000.00
1,001.60
1,003.20
1,004.80
$5,000
5,008
5,016
5,024
50.32
50.40
50.48
50.56
50.64
50.72
50.80
50.88
50.96
51.04
51.12
51.20
100.64
100.80
100.96
101.12
101.28
101.44
101.60
101.76
101.92
102.08
102.24
102.40
503.20
504.00
504.80
505.60
506.40
507.20
508.00
508.80
509.60
510.40
511.20
5X2.00
1,006.40
1,008.00
1,009,60
1,011.20
1,012.80
1,014.40
1,016.00
1,017.60
1,019.20
1,020.80
1,022.40
1,024.00
5,032
5,040
5,048
5,056
5,064
5,072
5,080
5,088
5,096
5,104
5,112
5,120
51.28
51.36
51.44
51.52
51.60
51.68
51.75
51.84
51.92
52.00
52.08
52.16
102.56
102.72
102.88
103.04
103.20
103.36
103.52
103.68
103.84
104.00
104.16
104.32
512.80
513.60
514.40
515.20
516.00
516.80
517.50
518.40
519.20
520.00
520.80
521.60
1,025.60
1,027.20
1,028.80
1,030.40
1,032.00
1,033.60
1,035.20
1,036.80
1,033.40
1,040.00
1,041.60
1,043.20
5,128
5,136
5,144
5,152
5,160
5,168
5,176
5,184
5,192
5,200
5,208
5,216
52.24
52.32
52.40
52.48
52.56
52.64
52.72
52.80
52*88
104.48
104.64
104.80
104.96
105.12
105.28
105.44
105.60
105.76
522.40
523.20
524.00
524.80
525.60
526.40_
527.20
528.00
528.80
1,044.80
1,046.40
1,048.00
1,049.60
1*051.20
4,052.80
1,054.40
1,056.00
1,057.60
5,224
5,232
5,240
5,248
5,256
5,264
5,272
5,280
5,288
United States of America
TREASURY TAX SAVINGS NOTES
Tax Series C
Issued at Par
Due 3 Years from Issue Date
Redeemable Before Maturity at Option of Owners
Acceptable at Par and Accrued Interest in Payment of Federal Income, Estate,
and Gift Taxes
1942
Department Circular No. 696
____t
iiscal Service
TREASURY DEPARTMENT,
Office of the Secretary,
Washington, September 12, 1942.
Bureau of the Public Debt
I.
OFFERING OF NOTES
1. The Secretary of the Treasuiy, pursuant to the authority of the
Second Liberty Bond Act, as amended, offers for sale, to the people of the
United States, at par, an issue of notes of the United States, designated
Treasury Notes of Tax Series C, which notes, as hereinafter provided, will
be receivable, at par and accrued interest, in payment of Federal income,
estate, and gift taxes.
2. The notes will be placed on sale September 14, 1942, and the sale
will continue until terminated by the Secretaiy of the Treasury.
3. The sale of Treasuiy Notes of Tax Series B-1944, pursuant to Treasury
Department Circular No. 674, dated December 15, 1941, will terminate at the
close of business on September 12, 1942.
4. Any holder of Treasury notes, Tax Series B-1944, purchased and bear
ing a date of issue in September 1942, may surrender such notes on or before
September 30, 1942, to the agency which issued the notes and receive in ex
change therefor Treasury notes, Tax Series C— 1945, of like face amount in
scribed in the same name and issued as of the first day of September, 1942,
together with a refund of the accrued interest included in the price paid
for the surrendered notes; Provided, that where less than $1,000 of such
Series B-1944 notes are so held, they may be surrendered with the cash
difference to be exchanged for a $1,000 Series C-1945 note.
II.
DESCRIPTION OF NOTES
1,
General.- The notes of Tax Series C will, in each instance, be
dated as of the first day of the month in which payment, at par, is received
and credited by an agent authorized to issue the notes. They will mature
3 years from such date, and may not be called by the Secretaiy of the
- 2 Treasury for redemption before maturity. All notes issued taring
n
calendar year shall constitute a separate series indicated hy tne letter C
followed hy the year of maturity. Subject to the provisions of SectionIV
of this circular, the notes will he receivable, at par and accrued interest,
in payment of Federal income, estate, and gift taxes. If not presented in pay
m e n t taxes, the notes will he payable at maturity, or, at the owner's option
and request, they will he redeemable before maturity, subject to the provi
sions of Section V of this circular.
2.
At the time of issue, the authorized issuing agent will inscribe on
the face of each note the name and address of the owner, will enter the date
as of which the note is issued, and will imprint his dating stamp ^
rent date). The notes will be issued in denominations of $1,000, $b,ouu,
$10 000. $100,000, $500,000 and $1,000,000. Exchanges of authorized denomi
nations from higher to lower, but not from lower to higher may be arranged
at the office of the agent that issued the note.
3.
The notes may not he transferred in ordinary course ; they may he
pledged as collateral for loans from hanking institutions, hut no other
hypothecation will he recognized hy the Treasury Department! Provided, if
held hy a corporation owning more than 50 percent of the stock, with voting
power, of another corporation, the notes may he transferred to the subsidiary,
upon request of the corporation and surrender of the notes to the agent Jhat
issued them; and Provided further, if notes pledged as collateral for a loan
are acquired because of the failure of a loan to he paid, the notes will he
redeemed at par and accrued interest to the month in which acquired on sur
render of the notes to the agent that issued them, accompanied hy proof of
the date of acquisition and hy request of the pledgee under power of attorney
given hy the pledgor in whose name the notes are inscribed, and in any such
cases the limitations on redemption before maturity provided in paragraph
l(a) of Section V of this circular shall not apply; the notes will not he
transferred to the pledgee. The notes will not he acceptable to secure de
posits of public money.
4.
Interest.- Interest on each $1,000 principal amount of notes of Tax
Series C will accrue each month from the month of issue, on a graduated scale,
as follows!
F ir s t to S ix th months, in c lu s iv e .....................................
Seventh to T w e lfth months, in c lu s iv e . ..........................
T h irte e n th to E ig h te en th months, i n c lu s iv e ..................
N in eteen th to Twenty-Fourth months, i n c l u s i v e .........
Twenty-Fifth to T h ir ty - S ix t h months, in c lu s iv e . . . .
$0.50each month
.80
«
"
.90
«
»
1.00
1.10
w
n
"
*
5. The table appended to this circular shows for notes of each denomination, for each consecutive calendar month from month of issue to month of maturity, (a) the amount of interest accrual, (b) the principal amount of the note
w ith accrued interest (cumulative) added, and (c) the approximate investment
yields.
In no case shall interest accrue "beyond the month in which the note
is presented in payment of taxes, or-'for redemption before maturity as pro
vided in Section V of this circular, or beyond its maturity. Interest will
be paid only with the principal amount.
6.
Taxation.- Income derived from the notes shall be subject to all
Federal taxes, now or hereafter imposed. The notes shall be subject to estate,
inheritance, gift or other excise taxes, whether Federal or State, but shall
be exempt from all taxation now or hereafter imposed on the principal or inter
est thereof by ary State, or any of the possessions of the United States, or
by any local taxing authority.
III.
PURCHASE OF NOTES
1. Auplications and payment.— Applications will be received by the Fed
eral Reserve Banks and Branches, and by the Treasurer of the United States,
Washington, D. C. Banking institutions and security dealers generally may
submit applications for account of customers, but only the Federal Reserve
Banks and the Treasury Department are authorized to act as official agencies.
Every application must be accompanied by payment in full, at par. Any form
of exchange, including personal checks, will be accepted subject to collec
tion, and should be drawn to the order of the Federal Reserve Bank or of the
Treasurer of the United States, as payee, as the case may be. The date funds
are made available on collection of excnange will govern the issue da-te of
the notes. Any depositary, qualified pursuant to the provisions of Treasury
Department Circular No. 92 (revised February 23, 1932, as supplemented) will
be permitted to make payment by credit for notes applied for on behalf of
itself or its customers up to any amount for which it shall be qualified in
excess of existing deposits.
2. Reservations.- The Secretary of the Treasury reserves the right to
reject any application in whole or in part, and to refuse to issue or permit
to be issued hereunder ary notes in any case or in any class or classes of
cases if he deems such action to be in the public interest, and his action
in any such respect shall be final.
If an application is rejected, in whole
or in part, ary payment received therefor will be refunded. The Secretary of
the Treasury, in his discretion, may designate agencies other than those here
in provided for the sale of, or for the handling of applications for, Treasury
notes to be issued hereunder.
3. Delivery of notes»— Upon acceptance of full-paid applications, notes
will be duly issued and, unless delivered in person, will be delivered within
the Continental United States, the Territories and Insular Possessions of the
United States, and the Canal Zone. No deliveries elsewhere will be made.
4. Form of. application.— In applying for notes under this circular, care
should be exercised to specify that notes of Tax Series C are desired, and
there must be furnished the name and address of the individual, corporation,
or other entity in which the notes are to be issued; and if address for
- 4 delivery of the notes is different, appropriate instructions should he given.
The name should he in the same form as that used in the Federal tax return of
the purchaser, except that in the case of joint tax returns of individuals,
the notes should he inscribed individually - the notes will not he issued in
the names of two or more persons jointly. The application should he accom
panied hy remittance to cover the purchase price — that is, par. The use of
an official application form is desirable, hut not necessary. Appropriate
forms may he obtained on application to any Federal Reserve Bank or Branch,
or the Treasurer of the United States, Washington, D. C.» hanking institu
tions and security dealers generally will he supplied with forms for the use
of their customers.
IV.
PRESENTATION IN PATMENT OF TAXES
1. During and after the second calendar month after the month of pur
chase (as shown hy the issue date on each note), during such time, and under
such rules and regulations as the Commissioner of Internal Revenue, with the
approval of the Secretary of the Treasury, shall prescribe, notes issued
hereunder in the name of a taxpayer (individual, corporation, or other entity)
may he presented and surrendered hy such taxpayer, his agent, or his estate,
to the Collector of Internal Revenue to whom the tax return is made, and will
he receivable hy the Collector at par and accrued interest from the month of
issue to the month, inclusive (hut no accrual beyond maturity), in which pre
sented, in payment of any Federal income taxes (current and hack personal and
corporation taxes, and excess-profits taxes), or any Federal estate or gift
taxes (current and hack), assessed against the original purchaser or his
estate. The notes must he forwarded to the Collector at the risk and expense
of the owner, and, for the owner’s protection, should he forwarded hy regis
tered mail, if not presented in person.
V.
CASH REDEMPTION AT OR PRIOR TO MATURITY
1. G-eneral.~ (a) Any Treasury note of Tax Series C not presented in pay
ment of taxes, will he paid at maturity, or, at the option and request of the
owner, will he redeemed before maturity, hut the notes may he redeemed before
maturity only during and after the sixth calendar month after the month of
issue (as shown on the face of each note), on 30 days1 advance notice. The
timely surrender of a note, hearing a properly executed request for payment,
will he accepted as constituting the advance notice required hereunder.
(h) Payment at maturity or on redemption before maturity will he made at
par and accrued interest to the month of payment, except, if a note is in
scribed in the name of a hank that accepts demand deposits, payment at matu
rity or on redemption before maturity will he made only at the issue price,
or par, of the note* However, if a note is acquired hy any such hank through
forfeiture of a loan, payment will he made at the redemption value for the
month in which so acquired,
- 5 2.
Execution of request for -payment.- The owner in whose name the note
is inscribed must appear before one of the officers authorized by the
Secretary of the Treasury to witness and certify requests for payment, establish his identity, and in the presence of such officer sign the request for
payment appearing on the back of the note, adding the address to which check
is to be mailed« After the request for payment has been so signed, the wit
nessing officer should complete and sign the certificate provided for his use.
3. Officers authorized to witness and certify requests for..payment.All officers authorized to witness and certify requests for payment of United
States Savings Bonds, as set forth in Treasury Department Circular No. 530,
Fifth Revision, are hereby authorized to witness and certify requests for
cash redemption of Treasury notes issued under this circular. Such officers
includes among others, United States postmasters, certain other post office
officials, a.nd the officers of all banks and trust companies incorporated in
the United States or its organized territories, including officers at bran
ches thereof.
4. Presentation and surrender.^ Rotes bearing properly executed re
quests for payment must be presented and surrendered to the agent that issued
the notes (as shown by the agent's dating stamp), at the expense and risk of
the owner. For the owner*s protection, notes should be forwarded by regis
tered mail, if not presented in person.
5. Disability or death.- In case of the disability or death of the
owner, and the notes are not to be presented in payment of Federal income,
estate or gift taxes due from him or from his estate, instructions should be
obtained from the issuing agent before the request for payment is executed,
or the notes presented.
6.
Partial redemption.- Partial cash redemption of a note, correspond
ing to an authorized denomination, ma}/ be ma.de in the same manner as for full
cash redemption, appropriate changes being made in the request for payment.
In case of partial redemption of a note, the remainder will be reissued in
the same name and with the same date of issue as the note surrendered.
7. Payment.- Payment of any note, either at
before maturity, will be made only by the Federal
the Treasury Department, as the case may be, that
be made by check drawn to the order of the owner,
given in his request for payment.
HI.
maturity or on redemption
Reserve Bank or Branch, or
issued the note, and will
and mailed to the address
GENERAL PROVISIONS
. Except as provided in this circular, the notes issued hereunder will
be subject to the general regulations of the Treasuiy Department, now or here
after prescribed, governing bonds and notes of the United States.
1
2. Federal Reserve Banks and their Branches, as fiscal agents of the
United States, are authorized to perform such services or acts as may he
appropriate and necessary under the provisions of this circular, and under
any instructions given hy the Secretary of the Treasury.
3 .
The Secretary of the Treasury may at any time or from time to time
supplement or amend the terms of this circular, or of any amendments or
supplements thereto, and may at any time or from time to time prescribe
amendatory rules and regulations governing the offering of the notes, in
formation as to which will promptly he furnished to the Federal Reserve
Banks.
Henry Morgenthau, Jr.,
Secretary of the Treasury.
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TREASURY DEPARTMENT
Washington
FOR IMMEDIATE RELEASE,
Friday, September 11, 1942.
Press Service
No. 33-24
Secretary Morgenthau today Issued the following statement:
The impression seems to have spread that I regard the
voluntary War Bond program as a iffailure.!? This is not only a
distortion of anything I have said on the subject but it is also
an injustice to the hundreds of thousands of devoted volunteers
in all parts of the country who are working night and day to en
list the nation’s savings for the war.
In view of our swiftly rising war expenditures I have said
that the voluntary War Bond program cannot alone close the gap
between the amount of money available for consumer spending and
the supply of goods available for civilian use. I have said
that it must therefore be supplemented by a more drastic and
comprehensive tax program, including a tax on spendings, a part
of which would be treated as a debt to the taxpayer and repaid
after the war. Vie shall, however, continue to rely upon volun
tary lending for a large part of our financing.
The mounting requirements of the war demand that our sale
of War Bonds be continued and intensified. As I said to the
Senate Finance Committee last week, it is my belief that the
voluntary War Bond program has produced and will continue to
produce a great contribution to the nation’s war effort. Re
gardless of the other measures that are needed, the voluntary
savings program will be essential until the war is won.
To our hundreds of thousands of War Bond volunteers, I
should like to say that the nation is counting on them more
than ever to carry on the magnificent work in which they are
so unselfishly engaged.
-oOo-
T R E A S U R Y DEPARTMENT
WASHINGTON
O FFICE OF
DIRECTOR OF THE MINT
September
1 1
, 194.2.
initiation of the Under Secretary.
i
i
*
“
*
*
*
'
<****•*"*“
■
I
Nellie T^siloe Ross, Director of th^^Tht, announces that,
ti|e manufacture of the ne^s^kcent pie^^tifliorìzed by Act of Congress
Marcii 27, 19^v, will start^^^^j^crBi^lladelphia Mint ne-xt^week. The cdin
t^.11 be composècì of^3i5%«‘
-®fTver,^o^^copper and 9% manganese. The
ifickel now iiici^d^tion is 25% nickel and 75% copper. The purpose
jbf the ch§jig«^of àjloy is to release nicitel and copper metals neèdedf
rfcgjià^rthe war. By adopting the new a l l o y / M l of the nickel former!;
ejce i s ss.ve d , and 25?» of tfebscopper.
The appearance of the new coin will not vary^gsçgtly
from that of the Jefferson nickel; the design will be the same,* bu1 it
wiljrburnish ntore readily.
’
ma cni]
The new coin will be adaptable to all types of vending
telephone mechanisms, parking meters and subway turnstiles.
^The alloy was developed in the Mints after extensive
experimentation by Mint metallurgists. Its adoption is a distinct
departure from standard coinage alloys, it never having been used before
by this or any other country for coinage purposes. Its use will require
some new equipment in the Mints. Delay in starting coinage, has been
occasioned, Mrs. Ross stated, by uncertainty of sect
ìe necessary
x&
metals to sustain continuous coinage of the piece, ? id difficultv in
securing the new equipment.
(Adoption of this new coin is distinctly a war measure.
The Act authorizing its coinage provides for termination on
December 3 1 , 1 9 4 6 .
TREASURY DEPARTMENT
WASHINGTON
S e c r e t a r y M o r g e n t h a u t o d a y a n n o u n c e d t h a t the n e w
five cent p i e c e a u t h o r i z e d b y A c t o f C o n g r e s s M a r c h 27,
w i l l b e c o m p o s e d of 35 p e r c e n t silver,
and
f
19 4 2
5 6 p e r c e n t copper,
9 p e r c e n t m a n g anese.
T h e n i c k e l n o w in c i r c u l a t i o n is c o m p o s e d o f
n i c k e l a n d 75 p e r c e n t copper.
2 5 percent
T h e p u r p o s e of the change of
a l l o y is to r e l e a s e n i c k e l a n d c o p p e r m e t a l s n e e d e d to win
t h e war.
By a d o p t i n g t h e n e w alloy,
a l l of the nickel
nerly u s e d in the five cent p i e c e is s a v e d a n d
2 5 percent
1
bhe copper.
K e l l i e T a y l o e Boss,
D i r e c t o r o f t h e Mint,
s a i d manufacture i
'he n e w c o i n w i l l s t a r t a t the P h i l a d e l p h i a M i n t next week.
TREASURY DEPARTMENT
Washington
FOR RELEASE, M O R N I N G N E W S P APERS,
Saturday, S e p t e m b e r 12, 1942,
Press Service
No, 33-25
S e c r e t a r y M o r g e n t h a u today a n n o u n c e d that the n e w
piece a u t h o r i z e d b y A ct of C o n gress M a r c h 27,
p o s e d of 35 p e r c e n t
silver,
56 p e r c e n t
copper,
five cent
1942 will be
com
and 9 p e rcent
manganese,
^Nellie T a y l o e Ross, D i r e c t o r of the Mint, said m a n u f a c t u r e
of the n e w coin will start at the P h i l a d e l p h i a M i n t nex t week.
The n i c k e l n o w in c i r c u l a t i o n is co m p o s e d of 25 p e r c e n t
n i c k e l and 75 p e r c e n t copper.
The p u r p o s e of the change of alloy
is to release n i c k e l and c o pper m e t a l s n e e d e d to w i n the war.
By
a d o p t i n g the n e w alloy, all of the n i c k e l f o r m e r l y u s e d in the
five cent piece is saved a nd 25 p e r c e n t o f the copper.
The a p p e a r a n c e of the n e w coin will n o t var y g r e a t l y f r o m
that o f the J e f f e r s o n nickel; the d e s i g n will be the same; b ut
it will t a r n i s h m o r e readily.
The n e w coin wil l be adaptable to all types of vending
m a c h ines, telephone m e c h a n i s m s , parking, m e t e r s and subway t u r n
stiles.
The a l l o y was d e v e l o p e d in the M i nts a f ter ex t e n s i v e e x p e r i
m e n t a t i o n by M i n t m e t a l l u r g i s t s .
Its a d o p t i o n is a di s t i n c t d e
p a r t u r e f rom s t a n d a r d coinage alloys, it n e v e r h a v i n g b e e n u s e d
b e f o r e b y this or any o t h e r c o u n t r y for coinage purposes.
Its
u s e will require some n e w e q u i p m e n t in the Mints.
D e l a y In
st a r t i n g coinage, has b e e n occasioned, Mrs. Ross stated, b y u n
c e r t a i n t y of se c u r i n g the n e c e s s a r y m e t a l s to s u s t a i n continuous
coinage of the piece, and d i f f i c u l t y in s e c uring the n e w e q u i p
ment ,
A d o p t i o n of this n e w coin is d i s t i n c t l y a w a r measure.
A ct a u t h o r i z i n g its coinage p r o v i d e s for t e r m i n a t i o n on
D e c e m b e r 31, 1946.
-oOo-
The
DIVIDEND PAYMENTS TO CREDITORS OF INSOLVENT NATIONAL
BANKS AUTHORIZED DURING THE MONTH ENDED
____ _______________ AUGUST 31. 1942_________________
Name & Location of Bank
Nature of
P.iyjr.flenft
District National Bk
Washington, D. C.
Final
Partial Int.
The First Nat*l Bk
Canonsburg, Penna.
'Partial Int.
Number and
Percentage
Date
of Dividend
Authorized Authorized
Distribution
of Funds by
Dividend
Authorized
kTotal
Percentage
Authorized
Dividends
tc* Date
Number of
Cla^a^ts
Amount
Claims
Pr gyved
8-l£-42
4th
2.88$
( 703,500
102.88$
8,818
$ 3,934,600
8-7-42
Int.
9.73$
173,300
109.73#
5,045
1,781,000
TREASURY DEPARTMENT
Comptroller of the Currency
Washington
Press Service
/% •
/ ? / 2^
J
3
/
During the month ended August 31 , 1942, authorisations were
issued to receivers for payments of dividends to the creditors of
two insolvent national banks.
Dividends so authorized will effect
total distributions of $876,800 to 13,863 claimants who have proved
claims aggregating $5,715,600, or an average payment of 15*375 percent.
The minimum and maximum percentages of dividends authorized were 2.88
percent and 9*73 percent, while the smallest and largest payments in
volved in dividend authorizations during the month were $173,300 and
$703,500, respectively.
Of the two dividends authorized during the
month, one was a final and partial interest payment and one was a
partial interest payment.
Dividend payments so authorized during the
month ended August 31, 194-2, were as follows:
TREASURE DEPAHTHENT
C o m p t r o l l e r of the C u r r e n c y
Washington
FO R RELEASE, M O R N I N G NEWS P A P E R S ,
Sunday, “S e p t e m b e r 13, 1942-,
During
were
Press S e r v i c e
No. 33<-26
the m o n t h e n ded A u g u s t 31,
1942,
authorizations
issu e d to r e c e i v e r s for pa y m e n t s of d i v i dends
creditors of two i n s o l v e n t n a t i o n a l banks.
a u t h o r i z e d wil l e f f e c t
to the
Dividends
so
total d i s t r i b u t i o n s of $ 8 7 6 , 8 0 0 to
1 3 , 8 6 3 claimants who h a v e p r o v e d claims a g g r e g a t i n g
$ 5 , 7 15,600,
or an average p a y m e n t of 1 5 , 3 7 5 percent.
The
m i n i m u m and m a x i m u m p e r c e n t a g e s o f d i v i d e n d s a u t h o r i z e d were
2.88 p e r c e n t an d 9 . 7 3 percent,
payments
w h ile
the
I n v o l v e d In d i v i d e n d a u t h o r i z a t i o n s d u r i n g the m o n t h
wer e $ 1 7 3 , 3 0 0 and $ 7 0 3,500,
r espectively.
dends a u t h o r i z e d d u r i n g the month,
dend payments
were
O f the two d i v i
one was a final a n d p a rtial
I n t e r e s t p a y m e n t a n d one was a p a r t i a l
1942,
s m a llest and la r g e s t
I n t erest payment.
Divi
so a u t h o r i z e d d u r i n g the m o n t h e n d e d A u g u s t 31,
as follows:
DIVIDEND PAYMENTS TO CREDITORS OP INSOLVENT NATIONAL
BANTS AUTHORIZED DURING THE MONTH ENDED
___________________AUGUST 31^ 1942__________________
Date
Authorized
Number and
Percentage
of Dividend
Authorized
Name & Location of Bank
Nature of
Dividend
District National Bk
Washington, D. G.
Pinal
Partial Int.
8-12-42
4th
The Pirst Nat’l Bk
Canonsburg, Penna.
Partial Int.
8-7-42
Int, 9.73$
2.88$
Distribution
of Punds by
Dividend
Authorized
Total
Percent age
Author!zed
Dividends Number of
to Date
Claimants
Amount
Claims
Proved
$ 703,500
102,88$
8,818
$ 3,934,600
173,300
109 .73$
5*045
1 ,781,000
TREASURY DIPAE1MSHT
Washington
FOR RELEASE, HOIKING NEWSPAPERS
^.September 15. 1942.
Press Service
;KpCQ,
» 'j
Secretary of the Treasury announced last evening that '
the tenders for 1400,000,000, or thereabouts, of 91-day Treasury
bills to be dated September 16 and to nature December 16, 1942, which
were offered on September 11, were opened at the Federal Reserve
Banks on September 14«
The details of this issue are as follows;
Total applied for - 1882,351,000
Total aeaepted
- 402,059,000
Range of accepted bids: (Excepting one tender of f25,000)
Lot 1 I 9?.'go! 8t*uivSlent
Average
Price 99.907
*
approximately 0.297 percent
•
*
0,369
»
(82 pereent of the amount bid for at the low prioe was aooeptei.)
1
TREASURY DEPARTMENT
Washington
POR RELEASE, MORNING- NEWSPAPERS,
Tuesday, September 15» 1942.
9/14/42
Press Service
No- 33-27
The Secretary of the Treasury announced last evening that
the tenders .for $400,000,000, or thereabouts, of 91-day Treasury
bills to be dated September 16 and to mature December 16, 1942,
which were offered on September 11, were opened at the Pederal
Reserve Banks on September 14.
The details of this issue are as follows:
Total applied for - $882,351,000
Total accepted
- 402,059»000
Range of accepted bids:
(Excepting one tender of $2 5 ,0 0 0 )
High - 99.925 Equivalent rate approximately 0.297 percent
Low
- 99.906
n
u
”
O . 3 7 2 " ,f
Average
Price - 99.907
n
,r
n
O.369
M
(82 percent of the amount bid for at the low price was accepted*
TO M * »
{
Barlag the month of dogast, the following
»»Hoot transmettons took place in direct and gaaranteed
securities of the OoTernments
Salo« , « *
, $#tM$6f000
Purchases
lot saleo
-
, , , , ,
$$#Uh6 t0OO
i
^«Maled) R- r_
Copy to:
Mr. Heffelflnger
Mrs. Shaw
Miss Sanford
m e
gwm
TREASURY DEPARTMENT
Washington
FOR I M M E D I A T E RELEASE,
S a turday, Augu&fr-1<5 , 1 0 I S .
/ ¿A.L^ct^j^
/ 4J
Market transactions
Press Service
Ne-.—
f 4 Y 2in G o v e r n m e n t
securities
inve s t m e n t and o t her a c c ounts in -JuTy”, 1942,
yvA,
sales of
for Treasury
r e s u l t e d in net
coo
,095--,-660, S e c r e t a r y M o r g e n t h a u a n n o u n c e d today.
-oOo-
TREASURY DEPARTMENT
Washington
POR IMMEDIATE RELEASE,
Tuesday, September 15, 1942.
Press Service
No, 35-28
Market transactions in Government securities for Treasury
investment and other accounts in August, 1942, resulted in net
sales of $8,446,000, Secretary Morgenth.au announced today.
TRSASCRT 2»AEDfl»T
Washington
FOE IMMEDIATE RBLMSE,
Wednesday. September 16. 1942.
Press
3
Sentlot
3 - 5 1
y
Secretary of the Treasury Morgenthau today announced the subscription figure*
and the bases of allotment for the cash offering of 0.65 percent Treasury Certifi*
cates of Indebtedness of Series 0-1943 and of 1-1/4 percent Treasury Notes of
Series 0-1945«
For the 0.65 percent Treasury Certificates of Indebtedness of Series C-1943,
reports received from the Federal Reserve Banks show that subscriptions total
approximately #1,992,000,000.
Subscriptions in amounts up to and including 125,000,
totaling about 644,000,000, were allotted in full.
625.000 were allotted 7~S
Subscriptions in amounts over
percent, on a straight percentage basis! but not lss*
than $25,000 on any ons subscription, with adjustments, where necessary, to the
61.000 denomination.
For the 1-1/4 percent Treasury Notes of Series C-1945, reports received from
the Federal Reserve Banks show that subscriptions total approximately 63,637,000,000.
Subscriptions in amounts up to and including $25,000, totaling about $134,0(30,000,
were allotted In full.
Subscriptions in amounts over $25,000 were allotted ^ p e r
cent, on a straight percentage basis, but not loss than $25,000 on any ons subscrip
tion, with adjustments, where necessary, to the $500 denomination.
Further details as to subscriptions and allotments will be announced when final
reports are received from the Federal Reserve Banks.
TREASURY DEPARTMENT
Washington
POR IMMEDIATE RELEASE,
Wednesday, September 16, 1942,
*
Press Service
No* 33-29
Secretary of the Treasury Morgenthau today announced
the subscription figures and the bases of allotment for the
cash offering of 0.65 percent Treasury Certificates of In
debtedness of Series C-1943 and of 1-1/4 percent Treasury
i
y,
Notes of Series C-1945*
For the 0.65 percent Treasury Certificates of Indebt
edness of Series C-1943, reports received from the Federal
Reserve Banks show that subscriptions total approximately
$>1,992,000,000. Subscriptions in amounts up to and includ
ing $>25 ,000, totaling about $44,000,000, were allotted in
full. Subscriptions in amounts over $>25,000 were allotted
75 percent, on a straight percentage basis, but not less
than $>25,000 on any one subscription, with adjustments,
where necessary, to the '$1,000 denomination.
For the 1-1/4 percent Treasury Notes of Series C-1945,
reports received from the Federal Reserve Banks show that
subscriptions total approximately $3,637,000,000. Sub
scriptions in amounts up to and including $ 25 ,000, totaling
about $134,000,000, were allotted in full. Subscriptions
in amounts over $ 25,000 were allotted 42 percent, on a
straight percentage basis, but not less than $25,000 on any
one subscription, with adjustments, where necessary, to the
$500 denomination.
Further details as to subscriptions and allotments will
be announced when final reports are received from the Federal
Reserve Banks.
-oOo-
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She Federal Reserve Brides will answer any ^nostions concerning the
rtportisf requirements*
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SArnold/AFLi *ch - %/ 1 5 /$ 2
TREASURY DEPARTMENT
Washington
POR RELEASE, MORNING NEWSPAPERS,
Thursday, September 17, 1942,
9/16/42
Press Service
No, 33-30
The Foreign Funds Control Division of the Treasury Depart
ment today announced regulations requiring a supplemental cen
sus of foreign-owned property,.
Pursuant to Public Circular No, 4C, issued under the freez
ing orders on September 14, 1942, the supplemental census will
be reported on Series L of Form TFR-300 which is now being dis
tributed to the Federal Reserve Banks. Reports on this series
will supplj7 current information concerning the property of cer
tain groups of persons to supplement the comprehensive survey
of foreign-owned property on the previous series of Form TFR-300,
issued last year. In some circumstances persons reporting on
Series L will also be obliged to file reports on one or more of
the earlier series, so that complete information will be avail
able concerning all property reported.
One of the largest groups of persons who must report are
nationals of foreign countries entering the United States at
any time after October 31, 1941. Persons who are already in.
this country must file their reports on or before October3Ï,
1942, and those entering hereafter must file within thirty days
of their entry. Reports are also required from persons whose
property is blocked under Executive Order No. 8389 by specific
direction of the Treasury Department and from anyone who holds
property belonging to such a person. These reports are to be
filed whenever blocking directions are issued by the Department,
Persons holding property of any one whose name is on ”The
Proclaimed List of Certain Blocked Nationals* must also report
on Series L, Reports concerning property of persons whose
names are already on the List must be submitted on or before
October^]), 1942, and reports relating to persons whose names
are added in the future must be made within fifteen days from
the date the addition is promulgated.
Public Circular No. 4C, which will also be available at
the Federal Reserve Banks, contains complete instructions for
preparing reports on Series L* The Federal Reserve Banks will
answer any questions concerning the reporting requirements.
-oOo-
- 3 -
issue or on subsequent purchase, and the amount actually received either
upon sale or redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss*
Treasury Department Circular No* 418, as amended* and this
notice, prescribe the terms of the Treasury bills and govern the condi
tions of their issue*
Copies of the circular may be obtained from any
Federal Heserve Bank or Branch*
J
R
i
I
\
I
-
2
-
Reserve Banks and Branches,following which public announcement will be made
by the Secretary of the Treasury of the amount and price range of accepted
bids.
Those submitting tenders will be advised of the acceptance or rejec
tion thereof.
The Secretary of the Treasury expressly reserves the right
to accept or reject any or all tenders, in whole or in part, and his action
in any such respect shall be final.
Payment of accepted tenders at the
prices offered must be made or completed at the Federal Reserve Bank in
cash or other immediately available funds on
September 23, l?4g----- .
The income derived from Treasury bills, whether interest or gain
from the sale or other disposition of the bills, shall not have any exemption,
as such, and loss from the sale or other disposition of Treasury bills shall
not have any special treatment, as such, under Federal tax Acts now or here
after enacted.
The bills shall be subject to estate, inheritance, gift, or
other excise taxes, whether Federal or State, but shall be exempt from all
taxation now or hereafter imposed on the principal or interest thereof by
any State, or any of the possessions of the United States, or by any local
taxing authority.
For purposes of taxation the amount of discount at which
Treasury bills are originally sold by the United States shall be considered
to be interest.
Under Sections 42 and 117 (a) (l) of the Internal Revenue
Code, as amended by Section 115 of the Revenue Act of 1941, the amount of
^
discount at which bills issued hereunder are sold shall not be considered
to accrue until such bills shall be sold, redeemed or otherwise disposed
of, and such bills are excluded from consideration as capital assets.
Accordingly, the owner of Treasury bills (other than life insurance com
panies) issued hereunder need Include in his income tax return only the
difference between the price paid for such bills, whether on original
J
TREASURY DEPARTMENT
3 3
Washington
FOR RELEASE, MORNING NEWSPAPERS,
Friday, September 18. 19A2
afcfaibc
The Secretary of the treasury, hy this public notice, invites tenders
for $ A00.000.000
, or thereabouts, of
Q1 -day Treasury bills, to be issued
on a discount basis under competitive bidding.
be dated September 23. 19A2
and will mature
The Dills of this series will
December 23 « 1 942--------- >
■when the face amount will be payable without interest.
They will be issued in
bearer form only, and in denominations of $*1,000, $5,000, $10,000, $100,000,
$500,000, and $>1 ,0 0 0 , 0 0 0
J
(maturity value).
Tenders will be received at Federal Reserve Banks and Branches up to the/Jj
War
I
closing hour, two o t e l p e k p. m., Eastern &&&&&& time, Monday, September 21, 1M_J
xfc&jc
Tenders will not be received at the Treasury Department, Washington. Each tender
must be for an even multiple of $1 ,0 0 0 , and the price offered must be expressed
on the basis of 100, with not more than three decimals, e. g., 99.925.
may not be used.
Fractions-
It is urged the.t tenders be made on the pointed forms and for
warded in the special envelopes which will be supplied by Federal Reserve Banks
or Branches on application therefor.
Tenders will be received without deposit from incorporated banks and
trust companies and from responsible and recognized dealers in investment securi
ties.
Tenders from others must be accompanied by payment of
10
percent of the
face amount of Treasury bills applied for, unless the tenders are accompanied by
an express guaranty of payment by an incorporated bank or trust company.
Immediately after the closing hour, tenders will be opened at the Federai
TREASURY DEPARTMENT
Washington
FOR RELEASE, MORNING NEWSPAPERS,
Friday, September 18, 1942._____
9/17/42
The Secretary of the Treasury, by this public notice,
invites tenders for $400,000,000, or thereabouts, of 91-day
Treasury bills, to be issued on a discount basis under competi
tive bidding*
The bills of this series will be dated
September 23, 1942, and will mature December 23, 1942, when the
face amount will be payable without interest.
They will be
issued in bearer form only, and in"denominations of $1,000,
$5,000, $10,000, $100,000, $500,000, and $1,000,000 (maturity
value)•
Tenders will be received at Federal Reserve Banks and
Branches up to the closing hour, two o ?clock p.m., Eastern War
time, Monday, September 21, 1942. Tenders will not be received
at the Treasury Department, Washington. Each tender must be
for an even multiple of $1,000, and the price offered must be
expressed on the basis of ICO, with not more than three deci
mals, e. g., 99.925. Fractions may not be used. It 16 urged
that tenders be made on the printed forms and forwarded in the
special envelopes which will be supplied by Federal Reserve
Banks cr Branches on application therefor.
Tenders will be- received without deposit from incorporated
banks and trust companies and from responsible and recognized
dealers in investment securities. Tenders from others must be
accompanied by payment of 10 percent of the face amount of
Treasury bills applied for, unless the tenders are accompanied
by an express guaranty of payment by an incorporated bank or
trust company.
Immediately after the closing hour, tenders will be opened
at the Federal Reserve Banks and Branches, following which
public announcement will be made by the Secretary of the Treasury
of the amount and price range of accepted bids. Those submitting
tenders will be advised of the acceptance or rejection thereof.
The Secretary of the Treasury expressly reserves the right to
accept or reject any or all tenders, in whole or in part, and
his action in any such respect shall be final * Payment of
33-31
(over)
1
2
accepted tenders at the prices offered must be made or com
pleted at the Federal Reserve Bank in cash or other immediately |
available funds on September 23,- 1942.
The income derived from Treasury bills, whether interest
•r gain from the sale or other disposition of the bills, shall
not have any exemption, as such, and loss from the sale or
(
other disposition of Treasury bills shall not have any special
treatment, as such, under Federal tax Acts now or hereafter
enacted. The bills shall be subject to estate, inheritance,
gift, or other excise taxes, whether Federal' or State, but shall
be exempt from all taxation now or hereafter imposed on the prin
cipal or interest thereof by any State, or any of the possessions!
of the United. States, or by any local taxing authority. For
purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States shall be considered
to be interest. Under Sections 42 and 117 (a) (1) of .the Internal
Revenue Code, as amended by Section 115 of the Revenue Act of
1941, the amount of discount at which bills issued hereunder are
sold shall not be considered to accrue until such bills shall
be sold, redeemed or otherwise disposed of, and such bills are
excluded from consideration as capital assets. Accordingly,
the owner of Treasury bills (other than life Insurance com
panies) Issued hereunder need include in his income tax return
only the difference between the price paid for such bills,
J
whether on original issue or on subsequent purchase, and the
1
amount actually received either upon sale or redemption at
maturity during the taxable year for which the return is made,
as ordinary gain or loss.
Treasury Department Circular No. 418, as amended, and this
notice, prescribe the terms of the Treasury bills ajid govern
the conditions of their issue. Copies of the circular may be
obtained from any Federal Reserve Bank or Branch.
oOo1,
i
1
TREASURY DEPARTMENT
Washington
FOR IMMEDIATE RELEASE
Thursday, September 17» 191*2
Press Service
No* *^3*
Secretary Morgenthau said today that the Treasury is making
arrangements for the sale of approximately 5,000,000 ounces of silver to
industrial users certified by the War Production Board as in urgent need
of silver for immediate use in war production*
The silver liiich the Treasury is arranging to sell is free
silver, classified as 11silver ordinary*• This class of silver has been
accumulating over a long period and is composed in part of silver purchased
for coinage prior to the Silver Purchase Act of 193U, in part of silver
contained in gold deposits, in part of recovered bullion which was lost
in the melting and coining processes, and the balance of silver in excess
of the amount estimated to be contained in mutilated coins* For many
years prior to the passage of the Silver Purchase Act of 193h, small
quantities of this class of silver were sold and used in medals which the
Mints manufactured for private organizations* The Treasury has legal
authority to sell the amount now on hand* The Silver Purchase Act of
I93li. imposes no limitations on this type of sale*
This silver has been put aside for use in the event of an
emergency* The Treasury has been informed by the War Production Board
that there is at present an acute shortage of silver available for the
manufacture of essential war materials* The War Production Board has
requested that the 5,000,000 ounces of *silver ordinary* be used to
alleviate this shortage*
The Treasury plans to sell this silver at the price of 1*5 cents
an ounce to those industrial users with high priority ratings who are
recommended by the War Production Board*
As previously announced, approximately 1,350,000,000 ounces of
free silver have already been made available by the Treasury for use in war
plants, under arrangements whereby the silver will be returned after the
war* The remaining 1,550,000,000 ounces of silver held by the Treasury
have been monetized and are a reserve against silver certificates*
0O0
y
TREASURY DEPARTMENT
Washington
POR IMMEDIATE RELEASE
Thursday, September 17, 1942:
Press Service
No. 33-32
Secretary Morgenthau said today that the Treasury is
making arrangements for the sale of approximately 5,000,000
ounces of silver to industrial users certified by the War
Production Board as in urgent need of silver for immediate
use in war production.
The silver which the Treasury is arranging to sell is
free silver, classified as "silver ordinary". This class of
silver has been accumulating over a long period and is com
posed in part of silver purchased for coinage prior to the
Silver Purchase Act of 1934, in part of silver contained in
gold deposits, in part of recovered bullion which was lost
in the melting and coining processes, and the balance of
silver in excess of the amount estimated to be contained in
mutilated coins. For many years prior to the passage of the
Silver Purchase Act of 1934, smhll quantities of this class
of silver were sold and used in medals which the Mints man
ufactured for private organizations. The Treasury has legal
authority to sell the amount now on hand. The Silver Pur
chase Act of 1934 imposes no limitations on this type of sale.
This silver has been put aside for use in the event of
an emergency. The Treasury has been informed by the War Pro
duction Board that there is at present an acute shortage of
silver available for the manufacture of essential war ma
terials. The War Production Board has requested that the
5.000. 000 ounces of "silver ordinary" be used to alleviate
this shortage.
The Treasury plans to sell this silver at the price of
45 cents an ounce to those industrial users with high prior
ity ratings who are recommended by the War Production Board.
As previously announced, approximately 1,350,000,000
ounces of free silver have already been made available by
the Treasury for use in war plants, under arrangements where
by the silver will be returned after the war. The remaining
1.550.000. 000 ounces of silver held by the Treasury have been
monetized and are a reserve against silver certificates.
-oOo-
(P
Example,
The M C o r p o r a t i o n f i l e d a r e t u r n for the
c a l e n d a r y e a r 1 9 4 1 on M a r c h 15, 1942, r e p o r t i n g t h erein
an a m o u n t o f $1,000,000, w h i c h was s u b s e q u e n t l y in t he
y e a r 1942 h e l d b y one of t h e d e s i g n a t e d r e n e g o t i a t i n g
a g e n c i e s to be ex c e s s i v e p r o f i t s r e a l i z e d in p e r f o r m a n c
of a contract, on w h i c h e x c e s s i v e p r o f i t s i n c o m e a n d
excess pr o f i t s t a xes a g g r e g a t i n g $ 4 0 0 , 0 0 0 w e r e paid.
The $ 4 0 0 , 0 0 0 taxes s h o u l d n o t be r e f u n d e d a n d t h e r e
m a i n d e r o f the e x c e s s i v e profits, o r $600,000, s h o u l d
be r e p a i d by t he c o r p o r a t i o n to t he G o v e r n m e n t . ¿ T h e
a m o u n t o f $ 6 0 0 , 0 0 0 r e p a i d to t h e G o v e r n m e n t w i l l n ot
c o n s t i t u t e an a l l o w a b l e d e d u c t i o n f rom g r o s s i n c o m e
for a n y t a x a b l e year.
This p r o d u c e s the c o r r e c t r e
sult.
E x c e s s i v e profits, b e f o r e F e d e r a l taxes, of
$ 1 , 0 0 0 , 0 0 0 w o u l d h a v e b e e n r e c a p t u r e d by the G o v e r n m e n t
$ 4 0 0 , 0 0 0 t h r o u g h the m e d i u m o f taxes a n d $ 6 0 0 , 0 0 0 by di
r e c t r e p a y m e n t to the Government, w i t h no a f t e r m a t h a f
fe c t i n g F e d e r a l taxes. JTo h o l d otherwise, for i n s t a n c e
to h o l d t h a t t he $ 1 , 0 0 0 / D 0 0 s h o u l d be repaid to the G o v
e r n m e n t a n d a l l o w s u c h r e p a y m e n t as a d e d u c t i o n for i n
come t a x p u r p o s e s f or the y e a r 1942, w h e n the ef f e c t i v e
r a t e of tax, for example, is 75 p e r cent, w o u l d p r o
d uce the f o l l o w i n g i n c o r r e c t result;
The t a x b e n e f i t
in 1942 w o u l d be $ 7 5 0 ,0 0 0 . Th e t a x p a y e r w o u l d h ave
p a i d $ 1 , 4 0 0 . 0 0 0 to the G o v e r n m e n t a n d d e r i v e d a t ax
b e n e f i t o f $ 7 5 0 ,0 0 0 . \The taxpayer, therefore, w o u l d
h a v e p a i d o nly $ 6 5 0 , 0 0 0 n e t to the G o v e rnment, w h e reas
the e x c e s s i v e p r o f i t s a d m i t t e d l y w e r e $ 1 , 0 0 0 , 0 0 0 . Eif*
f e r e n t r e s u l t s w o u l d be o b t a i n e d in o t h e r cases d e p e n d
i ng u p o n t h e factors of i n c o m e a n d e f f e c t i v e r a t e s o f
taxes b e i n g d i f f e r e n t f r o m t h o s e in t h i s example.
Example.
T he X C o r p o r a t i o n f i l e d a r e t u r n f or the
c a l e n d a r y e a r 194 2 on M a r c h 15, 1943.
In February,
1943, it was d e t e r m i n e d t h a t the t a x p a y e r h a d re a l i z e d
duri n g 1942 e x c e s s i v e p r o f i t s in the a m o u n t o f
$1,000,000, a n d the p a r t i e s a g r e e that d u r i n g 1943 r e
p a y m e n t o f s u c h e x c e s s i v e p r o f i t s w i l l be m a d e to the
G o v e r n m e n t in d e s i g n a t e d a m o u n t s p e r m o n t h u n t i l the
e n tire a m o u n t o f t h e $ 1 , 0 0 0 , 0 0 0 e x c e s s i v e p r o f i t s is
repaid. ¿ T h e gross i n c o m e to be r e p o r t e d by the c o r
p o r a t i o n xh its r e t u r n for 1942 s h o u l d n o t i n c l u d e the
$1,000,000, an d no t a x a t t r i b u t a b l e to e x c e s s i v e p r o fits
w i l l thus b e a s s e s s e d or paid.
No d e d u c t i o n f r o m g r o s s
i n c o m e w i l l be a l l o w e d f o r a n y y e a r f o r t h e a m o u n t of
the e x c e s s i v e p r o f i t s e x c l u d e d f r o m gross i n c o m e a n d
"•sucri aeiaucuxon is
Taxen«/
\
p / z / y V ^
3 2
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3
3
The Bureau of Internal Revenue today declared that companies
returning money to the Government as a result of renegotiation of
war contracts should refund only the amount of profits above Federal
income and excess profits taxes paid or assessed on the sum involved*
This opinion applies in cases where the renegotiating agreement
provides for reduced contract prices to be retroactively applied to
prior taxable years for which returns already have been filed and
income and excess profits taxes already paid or assessed*
The Bureau
; in such cases no such refund or abate
ment of these taxes should be made since the taxes should be con
sidered as a recapture of a portion of the excessive profits and
as such a proper offset against the total excessive profits.
The
repayment, the Bureau said, should not be allowed as a deduction in
the income and excess profits tax returns of the taxpayer for any
taxable year.
The Bureau also outlined procedure in cases where the renegotiating
agreement becomes effective before tax returns have been filed or
taxes paid or assessed.
In this instance the gross income to be
reported by the corporation should not include the excessive profits
so rebated and no tax attributable to excessive profits thus will
be assessed or naid.
The Bureau said the same procedure should rule in cases involving
a cost-plus-fixed-fee contract where an item for which the taxpayer
has been reimbursed is disallowed as an item of cost and the taxpayer
is required to repay to the United States the amount disallowed.
(Mr. Ooffelt says they expect to quote verbatim the two examples given
in the I. T.)
3 2 -
3
3
9
The Bureau of Internal Revenue today declared that companies
returning money to the Government as a result of renegotiation of
war contracts should refund only the amount of profits above Federal
income and excess profits taxes paid or assessed on the sum involved*
This opinion applies in cases where the renegotiating agreement
provides for reduced contract prices to he retroactively applied to
prior taxable years for which returns already have been filed and
income and excess profits taxes already paid or assessed*
i in such cases no such refund or abate
ment of these taxes should be made since the taxes should be con
sidered as a recapture of a portion of the excessive profits and
as such a proper offset against the total excessive profits*
The
repayment, the Bureau said, should not be allowed as a deduction in
the income and excess profits tax returns of the taxpayer for any
taxable year*
The Bureau also outlined procedure in cases where the renegotiating
agreement becomes effective before tax returns have been filed or
taxes paid or assessed*
In this instance the gross income to be
reported by the cozporation should not include the excessive profits
so rebated and no tax attributable to excessive profits thus will
be assessed or paid*
The Bureau said the same procedure should rule in cases involving
a cost-plus-fixed-fee contract where an item for which the taxpayer
has been reimbursed is disallowed as an item of cost and the taxpayer
is required to repay to the United States the amount disallowed*
T he B u r e a u " s t a t e m e n t o f p o l i c y " g a v e t h e f o l l o w i n g applications:
TREASURY DEPARTMENT
Washington
FOR IMMEDIATE RELEASE,
Friday September 18, 1942.
Press Service
No. 33-33
The Bureau of Internal Revenue today declared that compan
ies returning money to the G-overnment as a result of renegotia
tion of war contracts should refund only the amount of profits
above Federal income and excess profits taxes paid or assessed
on the sum involved.
This opinion applies in cases where the renegotiating agre
ment provides for reduced contract prices to be retroactively
applied to prior taxable years for which returns already have
been filed and income and excess profits taxes already paid or
assessed.
The Bureau stated that in such cases no such refund or
abatement of these taxes should be made since the taxes should
be considered as a recapture of a portion of the excessive
profits and as such a proper offset against the total excess
ive profits. The repayment, the Bureau said, should not be al
lowed as a deduction in the income and excess profits tax re
turns of the taxpayer for any taxable year.
The Bureau also outlined procedure in cases where the re
negotiating agreement becomes effective before tax returns have
been filed or taxes paid or assessed. In this instance the
gross income to be reported by the corporation should not in
clude the excessive profits so rebated and no tax attributable
to excessive profits thus will be assessed or paid.
The Bureau stated the same procedure should rule in cases
involving a cost-plus-fixed-fee contract where an item for
which the taxpayer has been reimbursed is disallowed as an
item of cost and the taxpayer is required to repay to the
United States the amount disallowed.
The Bureau “statement of policy” gave the following appli
cations}
Example. The M Corporation filed a return for
the calendar year 1941 on March 15, 1942, reporting
therein an amount of $1,000,000, which was subsequent
ly in the ¿/ear 1942 held by one of the designated re
negotiating agencies to be excessive profits realized
in performance of a contract, on which excessive
profits income and excess profits taxes aggregating
- a -
$400,000. were paid. The $400,000 taxes should, not
be refunded and the remainder of the excessive profits,
or $600,000, should be repaid by the corporation to
the Government,
The amount of $600,000 repaid to the Government
will not constitute an allowable deduction from gross
income for any taxable year. This produces the cor
rect result, Excessive profits, before Federal taxes,
of $1,000,000 would have been recaptured by the Gov
ernment, $400,000 through the medium of taxes and^
$600,000 by direct repayment to the Government, with
no aftermath affecting Federal taxes.
To hold otherwise, for instance, to hold that
the $1,000,000 should be repaid to the Government
and allow such repayment as a deduction for income
tax purposes for the year 1942, when the effective
rate of tax, for example, is 75 percent, would pro-^
duce the following incorrect result; The tax benefit
in 1942 would be $750,000. The taxpayer would have
paid $1,400,000 to the G o v e r n m e n t and derived a tax
benefit of $ 7 5 0 ,000 .
The taxpayer, therefore, would have paid only
$650,000 net to the Government, whereas the excess
ive profits admittedly were $1 ,000 ,000 . Different
results would be obtained in other cases depending
upon the factors of income and effective rates of
taxes being different from those in this «example.
Example. The X Corporation filed a return for
the calendar year 1942 on March 15» 1945. In Feb
ruary, 1945, it was determined that the taxpayer had
realized during 1942 -excessive profits in the amount
of $1,000,000, and the parties agree that during 1945
repayment of such excessive profits will be made to
the Government in designated amounts per month until
the entire amount of the $1,000>000 excessive profits
is repaid.
The gross income to be reported by the corpora
tion in its return for 1942 should not include the
$1 ,000 ,000 , and no tax attributable to excessive
profits will thus be assessed or paid. No deduction
from gross income will be allowed for any year for
the amount of the excessive profits excluded from
gross income and repaid to the Government.
-0O0-
TREASURY DEPARTMENT
Washington
FOE IMMEDIATE RELEASE,
Saturday. September 19 . 1962.
Press Service
3-?
■? - Mui
Secretary of the Treasury today announced the final subscription and
allotment figures with respect to the current offering of 0*65 percent Treasury
Certificates of Indebtedness of Series C-1943 and of X-l/4 percent Treasury Notes of
Series C-1945*
Subscriptions and allotments were divided among the several Federal Reserve
Districts and ths Treasury as follows $
Federal Reserve
District
Beaton
Heir York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St* Louie
Minneapolis
Kansas City
Dallas
San Francisco
Treasury
TOTAL
Treasury Certificates of
laAofefariMa«. Series 0-19A?
Total sub«»
Total sub«»
ecrlptions
scriptions
received
allotted
76,828,000
796 .913.000
68,153,000
91 . 585.000
70 .531.000
56.161.000
507.208.000
73 .301.000
a , 878,000
57.960.000
60.831.000
111 ,1 3 2 ,0 0 0
.
_
_
’_
_
_
_
__
« ,992,683,000
Treasury Notes,
Sssias. <h \ % 5
Total sub
Total sub
scriptions
scription.
received
allotted
58.265.000 8 205,103,500
598.856.000
1 .395,075,600
51.767.000
167 .686.000
69 .792.000
176.296.000
53.606.000
198.923.800
62 .791.000
252,202,500
382.903.000
532.806.300
56.025.000
98 ,781,900
32.666.000
65 ,357,100
66 .268.000
107 .355.300
31,181,000
107.966.800
83 , 827,000
367, 386,100
mm
v
, 3 .900.000
f e , 505,727,000
83,636,638,900
.810.000
, 896,900
.798.000
, 256,200
, 806,800
. 290.000
, 871,800
.189.300
, 978,100
. 976.000
.630.300
. 261.000
>638.000
,178,600
89
591
65
79
87
12 3
237
68
32
69
69
168
TREASURY DEPARTMENT
Washington
FOR IMMEDIATE RELEASE,
Saturday. September 19» 1942.
Press Service
No. 33-34
The Secretaiy of the Treasury today announced the final subscription and
allotment figures with respect to the current offering of 0.65 percent Treasury
Certificates of Indebtedness of Series C-1.943 and of 1-1/4 percent Treasury
Notes of Series C—1945.
tlNmiiii
Subscriptions and allotments were divided among the several Federal Reserve
Districts and the Treasury as follows!
asiai
M
»
Ifli;
|
no
100
300
000
100
(MO
HI
II
«I
I
I)
mi
if
HI
I
I
1
if
j
no
a
tfl0
MO
200
no
Federal Reserve
District
Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco
Treasury
TOTAL
Treasury Certificates of
Indebtedness , Series C-1943
Total subTotal subscriptions
scriptions
allotted
received
$ 76,828,000
796,913,000
öSaöö.XO
91.585,000
70,531pOOO
56,101.000
507,208,000
73,.301,OOO
41,878,000
57,960,000
40,831,000
111,132,000
-
$1,992,483,000
$
58,265,000
598,856,000
51,767,000
69,792,000
53,606,000
42,791,000
382,903,000
56,025,000
32,466,000
44,248,000
31,181,000
83,827,000
«*
$1,505,727,000
-oOo-
Treasury Notes,
Series C-'■1945
Total suby Total subspjriptions
scriptions
received
allotted
$
205,103,500
1,395,075,400
147,486,000
174,296,200
198,923,800
252,202,500
532,806,300
98,781,900
65,357,100
107,355,300
107,966,800
347,384,100
3.900.000
$3,636,638,900
$
89,810,000
591,894,900
65,798,000
79,256,200
87,804,800
123,290,000
237,871,800
48,189,300
32,978,100
49,976,000
49,430,300
148,241,000
1.638.000
$1,606,178,400
TREASURI BtPtXttOn
Washington
f o e BELSASK, MORBX80 NBSS-a PJSRS
Tttexter. September 22. 1942.
fPBBJte
■' -v 1 i
jgg
Press Service
J
^ '
3
*
1b« Secretary of the Treasury announced last evening that the tenders for
$400,000,000, or thereabouts, of 91-day treasury bills to be dated September 23 and
to nature December 23, 1942, which were offered on September 18, were opened at the
Federal Beserve Banks on September 21.
The details of this issue are as follows:
Total applied for - $795,564,000
Total accepted
400,037,000
Hange of accepted bids:
law
Average price
(Excepting one tender of $20,000}
* 99.925 Equivalent rate of discount approx. 0.297# per
- 99.905
*
•
■
■
n
0.376# *
- 9 9 .906
■
»
«
»
«
0.370# ■
(19 percent of the amount bid for at the low price was accepted)
\
«1
«
T R E A S U R Y D E P A RTMENT
Washington
F O R RELEASE, M O R N I N G NEWSPAPERS,
S e p t e m b e r 22, 19*2.
'
P r ess Service
No. 33-35
The S e c r e t a r y of the T r e a s u r y a n n o u n c e d last e v e n i n g that
the tenders for $^-00,000,000,
b i l l s to be d a t e d S e p t e m b e r
or thereabouts,
23
of 93.-^&y T r e a s u r y
and t o . m a t u r e D e c e m b e r
23, 19^ 2 ,
w h i c h w e r e o f f e r e d on S e p t e m b e r IS, w e r e o p e n e d at the Fe d e r a l
R e s e r v e Banks on S e p t e m b e r 21.
T h e details of this
issue are as follows:
T o t a l a p p l i e d for - 1 7 9 5 , 5 6 ^ , 0 0 0
Total accepted
400,037,000
R a nge of a c c e p t e d bids:
High
Low
( E x c epting one t e n d e r of $20,000)
- 9 9 * 9 2 5 E q u i v a l e n t rate of discount approx,
per annum
~ 9 9 .905 E q u i v a l e n t rate of discount approx,
p er a n n u m .
Average
P r ice - 9 9 ,906 E q u i v a l e n t rate of dis c o u n t approx.
p er a n num
0.29 7 ^
O .37656
0. 370%
( 1 9 p e r c e n t of the amount b i d for at the l o w p r i c e was a c c e p t e d )
— 0O 0-
INSOLVENT NATIONAL BANKS LIQUIDATED AND FINALLY CLOSED
___________DURING THE MONTH OF AUGUST 1 9 4 2 __________
1 /
2/
2/
Formerly in conservatorship
Including dividends paid thru or by purchasing bank
100$ principal and partial interest paid to creditors
INSOLVENT NATIONAL BANKS LIQUIDATED AND FINALLY CLOSED
______________DURING THE MONTH OF AUGUST 1942_________
Name and Location of Bank
Date of
Failure
Total
Disbursements
to Creditors
Including
Offsets Allowed
Percent
Dividends
Declared
to all
Claimants
Hyde Park Kenwood NB of
Chicago, Illinois
7-1-32
$ 3,536,490
69.75
First Natfl Bank
Da Quoin, 111.
i f
2^6-35
2,814,556
83.65
First Nat'l Bank
Joliet, Illinois
U
11-10-33
6,480,514
First Nat*l Bank
Brockport, N.Y.
1 /
2-2-34
1,307,437
2J
76.1203
2-13-34
4,380,845
8-5-33
First Nat*l Bank
Hempstead, N.Y.
i/
First Nat*l Bank
Charleroi, Penna.
2/
Nat*l Loan & Exchange Bk 1/
Columbia, South Carolina
Edisto Nat1! Bk
Orangeburg, S. C.
•—0—
100,000
-0-
1 0 0 . 2 1 ^ 1 ,040,000
-0-
75,000
-0-
97.9
500,000
-0-
1,752,717
32.15
200,000
-0-
5-22-34
1,920,015
82.22
50,000
-0-
10-29-31
13,416,011
2/
Monongahela Nat*l Bk
Pittsburgh, Penna.
Cash, Assets,
Uncollected Stock
Assessments, etc•
Returned to
Shareholders
600,000
$
i/
Larchmont NB & Tr Co
Larchmont, N.Y.
Capital
Stock at
Date of
Failure
T
2/
96.24
1 ,000,000
—0*““
7-5-33
2,721,251
2/
73.55
500,000
-0-
1-23-34
1,907,822
2/
71.6f>
110,000
-0-
i/
TREASURY DEPARTMENT
Comptroller of the Currency
Washington
FOR RELEASE, MORNING NEWSPAPERS
PRESS SERVICE
a î ' 3
During the month of August, 19A2,
the liquidation of
ten insolvent national banks was completed and the affairs of
such receiverships finally closed.
Total disbursements, including offsets allowed, to
depositors and other creditors of these ten receiverships,
amounted to $4.0,237,658, while dividends paid to unsecured
creditors amounted to an average of 85*24- percent of their
claims.
Total costs of liquidation of these receiverships
averaged 6*69 percent of total collections from all sources,
including offsets allowed.
Dividend distributions to all creditors of all active
receiverships during the month of August, amounted to $530,833*
Data as to results of liquidation of the receiverships finally
closed during the month are as follows:
'TREASURY DEPARTMENT
Comptroller of the Currency
Washington
FOR RELEASE, MORNING NEWSPAPERS,
Wednesday, September 23. 19^2.
9722/¿1-2
---- c---------- ■—
*---
Press Service
No. 33-36
During the month of August, 19*1-2, the liquidation of
ten insolvent nationalbanks was completed and the affairs of
such receiverships finally closed.
Total disbursements, including offsets allowed, to
depositors and other creditors of these ten receiverships,
amounted to
2f 3 7 »65 $,
- ' dividends paid to unsecured
creditors amounted to an average of S5,2^ percent of their
claims.
Total costs of liquidation of these receiverships
averaged 6,69 percent of total collections from all sources,
including offsets allowed.
Dividend distributions to all creditors of all active
receiverships during the month of August, amounted to
$530»$33*
Data as to results of liquidation of the receiver
ships finally closed during the month are as follows:
INSOLVENT NATIONAL BANKS LIQUIDATED AND FINALLY CLOSED
____________DURING- THE MONTH OF AUGUST 19^2_________
Name and Location of Bank
Hyde Park Kenwood NB of
Chicago, Illinois
Date of
Failure
Total
Disbursements
to Creditors
Including
Offsets Allowed
Percent
Dividends
Declared
to all
Claimants
Capital
Stock at
Date of
Failure
Cash, Ass
Uncollect
Assessmen
Returned
Sharehold
7 -1 - 3 2
1 3 .536,490
6 9 .7 5
| 600,000
-0-
2 -6 -3 5
2,214-, 556
83.65
100,000
- 0-
First Natfl Bank
Du Quoin, 1 1 1 .
1/
First Nat’l Bank
Joliet, Illinois
i/
n-io - 3 3
6,4-80,514-
2/1 /
10 0 .2 1
1 ,0^ 0,000
-0-
First Nat’l Bank
Brockport, N.Y.
i/
2 -2 -3 IJ-
1,307,^37
,
2/
7 6 .12 0 3
75,000
- 0-
First Nat’l Bank
Hempstead, N.Y.
1/
2 -1 3 - 3^
4-,380,845
97.9
500,000
„0-
Larchmont NB & Tr Co 1 /
Larchmont, N.Y.
g-5-33
1,752,717
32.15
200,000
- 0-
First Nat’l Bank
Charleroi, Penna.
5-22-3^
1 ,920,015
82.22
50,000
-0 -
13,416,011
96.24
1 ,000,000
-0-
i/
Monongahela Nat’l Bk
Pittsburgh, Penna.
IO-29 -3 I
Nat.’l Loan & Exchange Bk 1/
Columbia, South Carolina
7-5-33
Edisto Nat’l Bk
Orangeburg, S. C.
1/
1-23-34-
2/
2/
2/
2 ,7 2 1 , 2 5 1
73-55
500,000
-0-
1 ,907,822
■c
71.65
110,000
-0-
1/ Formerly in conservatorship
2/ Including dividends paid thru or by purchasing bank
3 / 100 % principal and partial interest paid to creditors
UPliS
<•» '¿ tm
(3) tenor&l Lie©»»©te* 2Qi s terni^ «genteé bgráiieliag th«
«•tend pstegtepii ihortof*
(4 ) 7te
of tilttot* ®g^si^ir&U*^ lioaoaod. trate ara®''-
l a jmrmipfmpii ( j) { & ) ©f te a o r & l lito©»#® te # 53 i t h#r@^r «»ideimi i a
t o foltot&g m $ p m b m
(s) Insert *toi Itsr&s telasá«* as a »putei* ito , ti@to#a‘
t o itm t o t e taxi is * t o Sai«© et Boriai SoeiiOigt te|toie«*
t o t o i t o t o * * t o t is * t o t e t o r l t o e S#*$ tedi*«»*
(b) M * i $ ®%r4« ute teteaoii*1, m à la i t o t o r a c i t sute
abitate *{1) tyrte t o Loteao&j «ad (2) t o M m nitrito Irisad»*»*
(3)
Lloano* io* U à «ad %fiar&X
ì & m & m Io* 77 nr^
tetogr rsrtete.
($ì
te&oriiX te&ittg' te» il is teratgr *¡jg?a»il#é in ite follovlag
r«Nep«*i»*
(^)
Sa tfe© dofiaibioii of *»ttoay abbicassi* in |3*p^|¡f,E0ti.
{2 )(a ){i) ©f s t o g«®r&X ruling, telot# t o word» «(terssmiy,
Italy# t o tep»a) t o t o
® & m m m ate ©f Bulgaria, lim#zxy,
Ei»i^aiA®|! @nn ia lio n t t e r o o f , «iitebibigte iti« word#
*{te«Magf9 Italy , ¿apea, Bulgaria, aa&gsry, «te tettaste)«
ífK ** *** tefiaitto of*W*y territory« ia psr&gr&pfe
(E) (b)(1) of saod
ruling, d@l#te ih.,. ®©rds %a¿i Jm p m *
t o in I t o t o r t o « t o i i b t o t o w d » *V«|M» Bulgaria,
Bteg«*F# and iterate**
(7) teatral Mamm te* 13 is teraby mmásá If ib© dateti©© ©f
word «taigooii* fross «salto (b) ©f p-sragraph (i) torto.
(t) toara! h iís m m lio* 66 üe asitote ©
ato«wbor 7, 1941, Iy
teteiiag ttotos (el), {#), to (f) torto*
(9) Q m & p® l Uoaua So* 69te« &
i3«tete ©
a Deooüter 7 f 1941, ty
á«X@ Uag ^ t o t o s ( b ) , ( s ) , t o
(4 ) t o r t o .
****&# tener»! Liosa«# te* 69 i# t o l q r
Xa ri#® o f ro ca « a t o »
mmá®á i© r#ed &» follows*
•i ganar**! liosas# 1# ter#ly gr&atoá ila«nei»g &# «
fanarmily 11«mto aditomi to tea Frtoigoo offto of to
teak of tessi©»«*
(S ig n a d ) B a n d o lp b P a u l
ü§
Rff^fajl B««r»i«ty of ite ?r@a«uiy*
tm m m m
sw p á g ñ u m
Offi©« of Afeo Seeret jry
SEP E 2 IW2
«na»
19
fxanmva mm& m * m m 9 m m m om ,
s m m m * 9x93* é s m m m 3(») j& d
¿niaua
c x í c ú l ¿& m o *
$(h) m tm s s m m m m tm m m t ¿m $ m
m m m ut M t n u m um ¿m ¿m ¿a s, 19 4 1 .
&EU3WQ to m m am mmm c m m u *
(X )
t a M M l Ltemum M&m A la
m&mimk b g r A b e f c d d i t i a t t
of m® foUUmiag p&r*graph %o tfe* *md tfe*r#©£s
"Smwritim tm m é or
th* tfoiiod
b/ Ah* S e v u ^ a sl of
©r «qr «A»A«* A^rrxtary, aisAriet, eo«n»
**T# am leifail^ or oth«*r poUtiesd euMlvisioa th^r«of
{Xaolaálag agmei*« sai iastm s^aU U «« of th« forofoiag)
»*** #ot b© #©Xá 0a * n ailo n « ! 6«© uritl«e ®x0hiáag*$ »wanritiáMi
th at mmh mmxrtttm* aro «©Id &t *ark*t ra in * «nd r*ur©u&at
A© «XX otkmr %®$m má emáX%tom precerib&d la Afeis ganoral
ULumm* "
(4
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*{1) A gaoor&l
iieaa®« 1© b«r*fegr grrufc<íd fc«Ah©riieing
th« poyiaifit feo» m y bloefce«! seemmA io Ah* Uaitssd Stost«*
©r tay a^msjr ©r instra&oatíaXAy tboreaf# ©r i© m y s k t s t
A#rriA©rr, disA riet, etnasAy, mmiQípeaitj, ©r peUiibftl
siátóivislQK la Afe# ílaitad SAmt««* « f musios duAles, t*x»ft*
•»d f«#s jmysble Ah^raA© Agr Ah© o^n#r ef ©ueh blo©k.«d n®-.
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•(a )
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w ith ia
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UuXtmá &to & # a
mktn$ my sin g lo $®ynm& in «reas* ©f #1,000, pwr&wmt
%ú Ah^ ios«# of ta i« gsasr&X liosa®«* sh&U £1Xü proaptly
»itb ib« ^ppropriata FtsdarsX Bogsr*© INak a r«;¿©rfc m%tln$
forfcb ih© d«tdLl« ©f #©©b
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pablia eiroular affoei« F^ria 131 and 133 5 K « in b@ in«
©X*aá®d la appans¿ic©s t© thoao püT%&m
S^atioa 5(b ), 40 S ta i. -Ali má fé% S^c. at Ai
Xj SA s te t.
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55 Stai» IJS| Eie, Or-i^r $309$
Ápril 10, 194Q, m mmw&M bj üx* 0rd«r 09#5#
XA* 1941 j ix*
Ordor $$32, July aé, 19AX| Kx» Orier ^ 3 * i í f S i í b 9* 1941* « i
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Crúor 9X93* J a l / 6* kf4#|
Rfcfoltttiof!** Aprii 10* 1940* m® aa«ttdM Jiai^ X4* 1941»
My aé, X94X*
-
2
-
Paragraph (5) revokes General License No* 11A, relating to the
payment of living expenses of Japanese nationals, and General License No. 77»
relating to Japanese farmers and food processors. Both of these licenses
were revoked by today’s action because any transactions effected pursuant
to their terms may also be effected either under the provisions of General
License No. 11, as affected by Public Circular No. 8A, or under the pro
visions of General License No. 68A. The provisions of General License No. 11
and of General License No. 68A remain unaffected by today’s action.
Paragraph (6) makes minor technical changes in two of the definitions appearing in General Ruling No. 11, expressly including Bulgaria,
Hungary, and Rumania in the category of countries upon which the United
States has formally declared war. The changes made do not alter in any
particular the effect of General Ruling No. 11. As heretofore, Bulgaria,
Hungary, and Rumania and their nationals are treated as enemy nationals.
The occupation of Rangoon by the enemy automatically cut off all
trade with that area and under General Ruling No. 11, transactions involving
trade or communication, with Rangoon were no longer licensed under General
License No. 13. Paragraph (7) of the public circular merely deletes the
word ’’Rangoon” from General License No. 13*
Paragraphs (8) and (9) of the circular direct attention to the
fact that Public Circular No. 8 amended General Licenses Nos. 66 and 69 to
exclude from their provisions offices of various Japanese banking institutions.
TREASURY DEPARTMENT
Washington
ELSASE;
Press Service
The Treasury Department today issued Public Circular No. 19,
revising several of the outstanding freezing control documents
The only provisions of the public circular which will have any
effect upon present practices of the public in complying with freezing
control are in paragraphs (1), (2), (3)? and (1;), relating respectively
to amendments to General Licenses Nos. k 9 5* 20, and 53*
Paragraph (1) of the public circular amends General License No. Ij.
so as to permit over-the-counter sales of government securities. Prior pro*
visions of General License No. k 9 relating to sales of securities on national
securities exchanges, are not affected by today’s action.
The effect of today’s amendment of General License No. 5 is to
require special licenses for the payment from blocked accounts on monies
owing to United States agencies on obligations other than customs duties,
taxes, and fees. Today’s amendment also eliminates the necessity for
reporting any payment of less than $1,000 effected under General License No. 5*
In accordance with the Treasury Department’s policy of eliminating
reporting requirements where study has shown such course of action to be
feasible, paragraph (3) of the public circular eliminates the necessity for
reporting payments under General License No. 20 from accounts of American
citizens who are foreign nationals by reason of presence within the Netherlands
West Indies.
The only effect of paragraph (k) of the public circular is to
include the Faroe Islands and the New Hebrides Islands within the area in
which trade is generally licensed by General License No. 53•
The remaining provisions of Public Circular No. 19 effect formal
changes designed to bring the freezing control documents up to date. They
do not change the categories of transactions which may be engaged in with
out special license or the procedures under which any transactions may be
effected without special license.
TREASURY DEPARTMENT
Washington
FOR IMMEDIATE RELEASE,
Tuesday. September 23, 1943,
Press Service
$0. 33*37
The Treasury Department today issued Public Circular No. 19, revising
*
\
several of the outstanding freezing control documents. •
The only provisions of the public circular which will have any effect
upon present practices of the public in complying with freezing control are
in paragraphs (l), (2), (.3), and (4)., relating respectively to amendments
to General Licenses Nos. 4, 5, 20, and 53.
Paragraph (l) of the public circular amends General License No. 4 so
as to permit over-the-counter sales of Government securities. Prior pro
visions of General License No. 4, relating to sales of securities on
national securities exchanges, are not affected by today'’s action.
The effect of today*s amendment of General License No. 5 is to require
special licenses for the payment from blocked accounts on monies owing to
United States agencies on obligations other than customs duties, taxes, and
fees. Today’s amendment also eliminates the necessity for reporting any
payment of less than $1,000 effected under General License No. 5.
In accordance with the Treasury Department’s policy of eliminating re
porting requirements where study has shown such course of action to be
feasible, paragraph (3) of the public circular eliminates the necessity for
reporting payments under General License No. 20 from accounts of American
citizens who are foreign nationals % reason of presence within the
Netherlands West Indies.
The only effect of paragraph (4) of the public circular is to include
the Faroe Islands and the New Hebrides Islands within the area in which trade
is generally licensed by General License No. 53.
The remaining provisions of Public Circular No* 19 effect formal changes
designed to bring the freezing control documents up to date. They do not
change the categories of transactions which may be engaged in without special
license or the procedures under which any transactions may be effected with
out special license.
Paragraph (5) revokes General License No. 11A, relating to the payment
of living expenses of Japanese nationals, and General License No. 77, relat
ing to Japanese farmers and food processors. Both of these licenses were
revoked by today’s action because any transactions effected pursuant to their
terms may also be effected either under the provisions of General License
-
2
-
No. 11, as affected by Public Circular No. 8A, or under the provisions of
General License No. 68A. The provisions of General License No. 11 and of
General License No. 68A remain unaffected by today’s action.
Paragraph (6) makes minor technical changes in two of the definitions
appearing in General Puling No. 11, expressly including Bulgaria, Hungary,
and Rumania in the category of countries upon which the United States has
formally declared war. The changes made do not alter in any particular the
effect of General Ruling No. 11. As heretofore, Bulgaria, Hungary, and
Rumania and their nationals are treated as enemy nationals.
The occupation of Rangoon by the enemy automatically cut off all trade
with that area and under General Ruling No. 11, transactions involving trade
or communication with Rangoon were no longer licensed under General License
No. 13. Paragraph (7) of the public circular merely deletes the word
"Rangoon” from General License No. 13.
Paragraphs (8) and (9) of the circular direct attention to the fact
that Public Circular No. 8 amended General Licenses Nos, 65 and 69 to ex
clude from their provisions offices of various Japanese banking institu
tions.
-oQo-
TREASURY DEPARTMENT
Office of the Secretary
September 2 2 , 1942
, -
PUBLIC CIRCULAR NO. 19
ORDER t o . 8339, AS AMENDED,
?/P?Uoï,V£ 0RI>ER KOi. 9193, SECTIONS 3(a) AND
5(b) OE THE TRADING'WITH THE ENEMY ACT AS
AMENDED BY THE PIRST WAR POWERS AC"’ 1941
RELATING TO POREIGM PONDS CONTROL.ft ’
’
TT1T.n7_
dition^of
lio- 4 is herebY amended by the adaition of the following paragraph to the end thereofj
”? e^ rï,tieT
sT issued.or'guaranteed by the Gov.
ernment of the United States or any state, terri'
C0?ntr^ municipality or other
political subdivision thereof (including agencies
be s o l ^ o n ^ ^ i ^ 16? °f the foreS°ing) need not
oe sold on a national securities exchange* nr*ovid«d
P^s^anf
S Ol d at
otner“ "teei-n
is and conditions pre^orib^d in this general license."
(2 ) General License No. 5 is hereby amended to read
as
follows ;
authnrit-r,A+feneral l10®1186 is hereby granted
the UniUd q ^ l Payment fron any t»1*"*«« account to
thleSf or h fS or+a"y aS®ncy
instrumentality
r
t
fccountr
e
«
°r
t h e r e t 0 by the »raer of such blocked
" S & B f S |p e ^ fS ° $ o
5 4 C| t a l 5179:
¿ubdivislo^ in
5
rS ^
Snd
p S b n c tN o ! 1 3 5 r d 7 7 t h ;c S e 0 - * ’
132
Snd
W 111
^
1;
■Order'E898?rdjr 83?9, April X°> 1940, °asAmended bjT&c.
£-derL,f^8 ^o^rUne
i941; Ex, Order 8832, July 26 1941*
^ e ^ e r r p f 6l
3 i J ? ° | m b e i 9 > 1 9 4 1 > a nd
¿ 9 9 8 , ’
tions Anril in -info" 0rder 9193* July 6 , 1942; RegulaJuly 26, I 94 il°’ 1940’ as amended June 14, 1941, and
(Over)
2
”(2) Banking institutions within the United
States making any single payment in excess of $1,000,
pursuant' to the terms of this general license, shall
file promptly with the appropriate Federal Reserve
Bank a report setting forth the details of such
transaction.”
(3) General license Ho. 20 is hereby amended by delet
ing the second paragraph thereof*
(4) The definition of the term ^generally licensed trade
area” in paragraph (3) (a) of General License,Ho. 53 is hereby
amended in the following respects:
(a) Insert ’’the Faroe Islands” as a separate
item between the item whose text is 11the Union of
Soviet Socialist Republics” and the item whose text
is ”the'Netherlands West Indies.”
(b) Delete “Syria and Lebanon”, and in lieu
thereof, substitute ” (1) Syria and Lebanon; and.
(2) the Hew Hebrides Islands” .
(5) General License Ho. 11A and General License Ho. 77
are hereby revoked.
(6) General Ruling Ho. 11 is hereby amended in the fol
lowing respects:
(a) In the definition of ”enemy national” in
paragraph (2)(-a)(i) of such general ruling, delete
the -words ” (Germany, Italy, and Japan) and the Gov
ernments of Bulgaria, Hungary, and Rumania”, and in
lieu thereof, substitute the words ”(Germany, Italy,
Japan, Bulgaria, Hungary, and Rumania)” .
(b)
paragraph
the words
the words
In the definition of ”enemy territory” in
(2)(b)(i) of such general ruling, delete
’’and Japan” and in lieu thereof substitute
”Japan, Bulgaria, Hungary, and Rumania”.
(7) General License Ho. 13 is hereby amended by the de
letion of the word ’’Rangoon” from section (b) of paragraph
(1):thereof.
« (8) General License Ho. 66 was amended on December 7,
by deleting sections (’
d), (e), and (f) thereof.
1941,
(9) General'License Ho. ¿9 was amended on December 7
1941, by deleting sections' (b), (c), and (d) thereof1. In
view of such amendment, General License Ho. 69 is hereby
amended to read as follows:
”A general license is hereby granted licensing
as a generally licensed national the San Francisco
office of the Bank of Canton.”
(Signed) Randolph Paul,
Acting Secretary of the Treasury.
2
M o r e than a b i l l i o n coins of va r i o u s
t u r n e d o u t by th e Ph i l a d e l p h i a ,
last year,
d e n o m i n a t i o n s wer e
D e n v e r a n d S an F r a n c i s c o Mints
fiv e t i mes t h e v o l u m e of a f e w years back.
The i n c r e a s e d u s e of s m a l l e r coins is due to s u c h factors
as i n c r e a s e d p o p u l a r i t y of v e n d i n g m a c h i n e s a n d e n t e r t a i n m e n t
devices,
a p p l i c a t i o n by m a n y states of sales taxes,
eral i n c r e a s e in bu s i n e s s activity,
tion of savings.
to th e g e n
as w e l l as to t h e a c c u m u l a
^ ©I H e 'Tay 1 o e H o s s , D
i
r
u
r
g
e
d
p e r s o n s abou^aulating coins \with w h i c h to p u r c h a s e War^Scnt^s to
^^iiiiiiiTi.
t u r n t h e m in f or W a r ' B S w i n g s S t a m p s i n a t e a C '
This w o u l d free coin^^.^^^usiB'e^s*,,^
a n d ease t h e burden
.J.,r~**/a********'^
^** N w
u p o n the
a n d at th e sameTJinfr^^
1
in^^urb^tantial s a v ing of m e t a ls v i t a l for the urosecuti on n-f
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,
V
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^
I
j
the war.
M i n t c o i n a g e o p e r a t i o n s h a v e b e e n on a 2 4 - h o u r - a - d a y basis
f or two years,
/ n<Jn
i ^ nt'
n ^!juTA i
-*****ih e P h i 1j
placing an extraordinary burden upon personnel/
M O r ® t h a n t h i r t y tons o f m e t a l a d a y
I eo
alone.
D e m a n d is g r e a t e s t f o r o n e - c e n t pieces,
a n d it is t he penny
that ca n b e d i s g o r g e d in g r e a t e s t q u a n t i t i e s f r o m c h i l d r e n ' s
banks a nd s u g a r bowls
1
„t i — u , Mrs.
R o s s believes.
T he D i r e c t o r c i t e d a l e t t e r r e o e i v e d f r o m a f o r m e r M i n t
e m p loyee^
He h a d r e a d o f the c r i t i c a l n e e d f or m e t a l s in w a r
p r o d u c t i o n a n d r e p o r t s o f s t u d i e s b e ing m a d e l o o k i n g to possible
This « f N H O T d f o r m e r g u a r d f r o m the Phi-Indelphia Miirt^iold
Mrs. R o s s he h a d f o u n d e n o u g h p e n n i e s in b u r e a u d r awers a n d
o t her caches a b o u t his h o m e to b u y a # 2 5 W a r Bond.
IP
|¡ite
ri i
I ; ; !or se
liliti
f!
illfoi
feti
u s e of p l a s t i c coins.
His a n d
m a n y s i m i l a r l e t ters h a v e b e e n r e c e i v e d a t the M i n t u r g « $ o t h e r s
to t r ade t h e i r coins f o r stamps.
(Vti
; Iteri
lllpi
! :
IJ «I
■tupned
: lisi Ji
li !!
I .filili]
| illesi
| fli
flouoj
V* 3<
0
4 P
/ /
Mrs.Nellie Tayloe Ross, At^e^tor of the Mint, today urged
that thrifty Americans return their coin savings to circulation to
innim t m r
ease the production strain on the Mint establishments and
« 1»
at the same time save tons of metals vital to the War by lessening
the demands for new coins.
The Director suggested that^ accumulations of coins
e
converted into W^ar Savings Stamps and Bonds, freeing the money
itimi
for business
W *
use.
in
M i n t co i n a g e o p e r a t i o n s h a v e b een on a 2 4 - h o u r - a - d a y basis
f o r two years,
a n d equipment.
placing an extraordinary burden upon personnel
M o r e tha n t h i r t y tons o f m e t a l a d ay
t h e Phi 1 j
a n d it is the penny
t hat can b e d i s g o r g e d in g r e a t e s t q u a n t i t i e s f r o m c h i l d r e n ’s
b a nks an d s u g a r bowls
I..w i n ... Mrs.
aij m
lira’s ta
R o s s believes.
The D i r e c t o r c i t e d a l e t t e r r e c e i v e d f r o m a f o r m e r M i n t
w nO W m
'TUsm q , ,
employee^
He h a d r e a d of the c r i t i c a l n e e d for m e t a l s in war
p r o d u c t i o n a n d r e p o r t s of s t u dies b e ing m a d e l o o k i n g to possible
esployee
listali
lookine ti
: n
o
h
l
ai fi
ikttMis
u s e of p l a s t i c coins.
l'ami
for two :
ta li tl
D e m a n d is g r e a t e s t f o r o n e - c e n t pieces,
This
tA
f o r m e r g u a r d f r o m t he RhriariUlphin M i n % ? o l d
letters hi
Mr coli
Mrs. R o s s he h a d f o u n d e n o u g h p e n n i e s in b u r e a u d r a w e r s and
o t h e r caches a b o u t his h o m e to b u y a #25 W a r Bond.
His and
m a n y s i m i l a r l e t ters h ave b e e n r e c e i v e d a t the M i n t urgeiifejothers
to t r a d e t h e i r coins f o r stamps.
The
tosai
Flees, I
pal lncn
! Of g;
*1« M
TREASURY DEPARTMENT
Washington
■* “5»aDilsJap,;
FOR IMMEDIATE RELEASE,
W e d n e s d a y , S e p t e m b e r 23,
!3rijf]{;,:
M rs.
urged
SeeingW
j
that
culation
ments
war by
Nellie
a nd
T a y l o r Ross,
thrifty Americans
to
at
ease
the
Press Service
No. 3 3 - 3 8
19^-2,
D i r e c t o r of t he Mint,
return
their
the p r o d u c t i o n
strain
same
tons
l e s s e n i n g the
time
save
demands
for
coin
savings
on t h e M i n t
of m e t a l s
today
to c i r
establish
vital
to
the
n e w c oins.
T h e D i r e c t o r s u g g e s t e d that t h r i f t a c c u m u l a t i o n s of c o i n s
b e c o n v e r t e d i n t o W a r S a v i n g s S t a m p s and Bonds, f r e e i n g t h e
m o n e y f o r b u s i n e s s use.
4-hour-a-dajk
Q uponperse
,
M
■
1 a dajM
and itistlep
fro« c M M
rs, Rosstolls
b
a formerli
or metalsW
lootingtoP
2H—
M i n t c o i n a g e o p e r a t i o n s h a v e b e e n on a
hour-a-day basis
f o r two years, p l a c i n g a n e x t r a o r d i n a r y b u r d e n u p o n p e r s o n n e l
and equipment.
More than thirty tons of metal a day p a s s e s
t h r o u g h t he p r e s s e s at t h e P h i l a d e l p h i a M i n t alone.
D e m a n d is g r e a t e s t f o r o n e - c e n t p i e c e s , a n d it is t he
p e n n y t h a t c a n b e d i s g o r g e d in g r e a t e s t q u a n t i t i e s f r o m c h i l
d r e n ^ b a n k s a nd s u g a r b o wls, Mrs. R o s s b e l i e v e s .
The Director cited a letter received from a former Mint
e m p l o y e e n o w in t h e N a v y .
He h a d r e a d of the c r i t i c a l n e e d
f o r m e t a l s i n w a r p r o d u c t i o n a n d r e p o r t s of s t u d i e s b e i n g m a d e
l o o k i n g to p o s s i b l e u s e of p l a s t i c c o i n s .
T h i s f o r m e r g u a r d f r o m the M i n t S e r v i c e t o l d Mrs. R o s s he
h a d f o u n d e n o u g h p e n n i e s in b u r e a u d r a w e r s a n d o t h e r c a c h e s
a b o u t h i s h o m e to b u y a | 2 5 W a r B o n d .
H i s a nd m a n y s i m i l a r
l e t t e r s h a v e b e e n r e c e i v e d at t h o M i n t urging o t h e r s to t r a d e
their coins for stamps.
to ■
auiianti^
Mi » *
e lintnaf
M o r e t h a n a b i l l i o n c o i n s of various, d e n o m i n a t i o n s w e r e
t u r n e d out b y t he P h i l a d e l p h i a , D e n v e r a n d S a n F r a n c i s c o M i n t s
l a s t year, f i v e t i m e s t h e v o l u m e of a f e w y e a r s b a c k .
T h e I n c r e a s e d u s e of s m a l l e r c o i n s is d u e to s u c h f a c t o r s
as I n c r e a s e d p o p u l a r i t y of v e n d i n g m a c h i n e s a n d e n t e r t a i n m e n t
d e v i c e s , a p p l i c a t i o n b y m a n y s t a t e s of s a l e s taxes, to t he g e n
e r a l i n c r e a s e in b u s i n e s s a c t i v i t y , as w e l l as to t h e a c c u m u l a
t i o n of s a v i n g s .
-oOo-
-
2
-
Six months ended
June 30» »
19^2
:
Dividends declared:
On preferred stock..... ..........
On common stock...................
TOTAL DIVIDENDS DECLARED.... .
$ 3.^66
66,327
69.793
June 30»
19^1
:
:
Year ended
Dec. 31, :
19^1
:
$ 3,821
7^,760
___ 69,389___ 78,581
$ >+,379
65,010
Dec. 31 ,
191»!
$ 8,200
139,770
11*7,970
5,136
Percent
5,123
Percent
Percent
Annual rate of net profits:
On common and preferred stock 1/ ..
On capital funds l / ...............
lU .92
6.12
17-^2
7-38
1 7 .9“+
7 .U6
17.70
7.37
Annual rate of dividends:
On common and preferred stock l / ..
On capital funds l / ...............
9.26
3.80
9.10
3.S6
10.3^
i*.30
9.73
i*.05
/
1/ At end of period.
- 0O 0-
}
5.123
5,107
Percent
Number of banks 1 ] ..................
|
!
EARNINGS, EXPENSES, AND DIVIDENDS OP NATIONAL BANKS IN THE SIX MONTHS
ENDED JUNE 30, 19I+2, AND SEMIANNUALLY IN THE CALENDAR YEAR 19U1.
(Amounts in thousands of dollars)
: Deo. 31,
i
19>+1
June 30» • June 30, : Dec. 31,
191+1
:
19I+I
19I+2 :
Capital stock, par value: 1/
Preferred........................
Common...........................
TOTAL CAPITAL STOCK............
Capital funds \ ] ..................
$169,303
1,351.981
1,521,281+
3,656,300“
22M 0U
220,382
237,081+
>+57,>+66
161,623
lUl.772
15,235
150,212
18,087
291,981+
26,61+6
21.589
1+1+6,750
22,1+85
26,1+1+2
2++,603
>+78.913
1+1+,211
52,1+88
1+6,192
925,663"
52.5>+8
77. >+36
56,196
85.877
163,313
50,1+81+
10,111
>+8,715
10,1+52
37,265
9>+.366
332,871
15.096
23,21+6
26,201
20.563
>+70.333
5Ml7
86,617
U5 .63I
9,737
39.7^9
1
CVi
0
308,777
137,973
it
19,008
18,066
,5.>+27
42,501
27.306
90,892
pH
97.625
334.176
136,657
21,726
it
TOTAL LOSSES AND DEPRECIATION...
NET PROFITS BEFORE DIVIDENDS.......
$169,303
1.351.981
1 ,521,281+
3 .656,300
U3
Gross operating earnings:
Interest and discount on loans,...
Interest and dividends on bonds
and securities.................
Trust department.................
Service charges on depopit accounts
Rent received.... ................
Other earnings...................
TOTAL GROSS OPERATING EARNINGS.. “
Gross operating expenses:
Salaries and wages—
Officers................. ......
Employees other than officers...
Interest on time and savings
deposits.......................
Real estate taxes................
Other taxes......... .............
Other expenses...................
TOTAL GROSS OPERATING EXPENSES..
NET OPERATING EARNINGS.............
Recoveries:
On loans..........................
On bonds and securities..........
All other........................ .
TOTAL RECOVERIES........... .
Profits on securities sold.......
TOTAL RECOVERIES AND PROFITS
ON SECURITIES SOLD...........
Losses and depreciation:
On loans.........................
On bonds and securities..........
On banking house, furniture and
fixtures.......................
All other........................
$181+,1+1+1
1,31+0,705
1 ,525,ll+b
3.598,11+1
$152,379
1,356.521
1 ,508,900
3.679.^92
33,322
108 J1+1+
99,199
20,563
6>+,57i
185.258
61+1,m
281+.015
16,275
18.335
22,508
6,1+51+
>+7.297
38,61+8
25,323
25.61+9
8,510
59,^82
>+1.335
ii+,96i+
106.779
79,983
58,776
S5.9>+5
100,817
186,762
23,235
1+++.073
1+8,061
28,75>+
51.989
92,131+
21,856
38,73°
13,192
9,038
82,816
112,617
ll+,528
9,298
91,13>+
132,78>+
>+3.658
1+8,157
33.862
23.>+97
19.33>+
1>+.199
110,31+8
201,1+82
136,511
269.295
2
Profits on securities sold during the six months ended June 30» 19^-2,
aggregated $16,275*000 as against $3S,6Ug,000 in the six-month period ended
June
19^1 .
Losses and depreciation on bonds and securities totaling
$3^,730,000 were $5*3^3*000 less than in the first six months of
19^1 .
Dividends declared on common and preferred stock in the first half
of
19^2
half of
totaled $69,793*000, in comparison with $69,339*000 in the first
19^1 .
The annual rate of dividends was
9*26
preferred capital and 3*30 percent of capital funds.
percent of common and
W-3
TREASURY DEPARTMENT
Comptroller of the Currency
Washington
FOR RELEASE
Press Service
A S 'j
*
Ko-
a.
3 3
-Sf
Comptroller of the Currency Preston Delano announced today that the
5,107 national hanks in the United States and possessions reported gross
earnings of $^70,833»000 for the six months ended June 30, 19^2.
This repre
sents an increase of $2^,083,000 over the gross earnings for the six months
ended June 30, 19^1. when there were 5,136 national hanks in operation.
Operating expenses for the first half of 19^-2 were $33^,176,000 as
against $308,777,000 for the first half of 19^+1.
$136,657»000, a decrease of $1 ,316,01
Net operating earnings were
first half of
19^1 .
Adding to the net operating earnings profits on securities sold of
$16,275,000 and recoveries on loans and investments, etc., previously charged
off of $U2,501,000, and deducting losses and depreciation of $82,816,000, the
net profits before dividends for the six months ended June 30, 19^-2, amounted
to $112,617,000, or at an annual rate of lU .92 percent of the par value of com
mon and preferred stock and 6.12 percent of capital funds.
This figure of net
profits before dividends was $20,167,000 less than the amount reported for the
six months ended June 30, 19^1«
The principal items of operating earnings in the six-month period ended
June 30, 19^2, were $22^,10^,000 from interest and discount on loans, an
increase of $3 ,722,000 over the corresponding period in I9I+I; and $l6l,623,000
from interest and dividends on bonds and securities, an increase of
$19,851,000.
The principal operating expenses were $lUl,U3U,000 for salaries
and wages of officers and employees, and $^5 ,631,000 expended in the form of
interest on time and savings deposits.
TREASURY DEPARTMENT
Comptroller of the Currency
Washington
POR RELEASE, MORNILG NEWSPAPERS,
Friday, September 25. 1.942.
Press Service
No. 33-39
Comptroller of the1 Currency Preston Delano announced today
that the 5,107 national banks in the United States and posses
sions reported gross earnings of $ 470,833,000 for the six months
ended June 30, 1942.
This represents an increase of $24,083,000
over the gross earnings for the six months ended June 30, 1941,
when there were 5,136 national banks in operation.
If' . Operating expenses for the lirst half of 1942 were
¥334,176,000 as against $308.777,000 for the first half of 1941
Net operating earnings were $136,657,000, a decrease of
¥1,316,000 under the first half of 1941 ,
g R k ! k c t^ A netJoperatin? earr>ings profits on securities
cold. oi ¥1 6 ,275,000 and recoveries on loans and investments,
etc. previously charged off of #42,501,000, and deducting losses
^®Preolatl°n of #82,816,000, the net profits before dividends
for the six months ended June 30, 1942, amounted to $112,617,000,
SJ anm;Jal rate of 14.92 percent of the par value of common
and preierred stock and c .12 percent of capital funds. This
figure of net profits before dividends was $ 20,167,000 less than
the amount reported for the six months ended June 30, 1941.
The principal items of operatine earnings in the six-month
period ended June 30, 1942, were $22 4.104.000 from interest and
discount on loans, an increase of $a ,722,000 over the corresponding period in 1941; and $161,623,000 from interest and dividends
on bonds and securities, an increase of $19,851,000. The principal operating expenses were $14 1,4 34.000
for salaries and
wages of officers and employees, and $45,631,000 expended in the
form 01 interest on time and savings deposit's,
Profits on ecunties sold during the six months ended June
30, 1942 , aggregated $16,275,000 as against $38,648,000 in the
six-month period ended June 1941. Losses and depreciation on
bonds and securities totaling $ 38,730,000 were $ 5 ,343,000 less
than m the first six months of 1941 .
Dividends declared on common and preferred stock in the
o:i: ***942 totaled $69,793,000, in comparison with
^59,^89,OOO in the first half of 1941* The annual rate of div
idends was 9.26 percent of common and preferred capital and 3*80
percent of capital funds.
-
2
-
Six months ended
Year ended
«June 30, ; June 30, ; -Dec. 31, :
Dec. 31,
1941
:
1941
2
1942
:
1941
Dividends dedared:
Gn preferred stock....«..**».
On common stock*•..•••••••••«
TOTAL DIVIDENDS DECLARED...
Number of banks 1/.............
£> 3,466
66.327
69.793
$ 4,379
65,010
69.389
$ 3,821
74.760
ryS r
5.107
Percent
'5.136
Percent
5.123
Percent
Annual rate of net profits;
On common and preferred stock l/•.
On eepi td funds "!
14.92
6.12
17.42
17.94
Annual rate of dividends:
■ On common and preferred stock 1 /*4
On capital funds l/.........
9.26
3.SO
9.10
3.86
1/ At end of period*
-0O0-
ri
fi 8 , 2 0 0
139.770
147.970
5.123
Percent
1 7 .7 0
7 .4 6
7 .3 7
10.34
4.30
9 .7 3
4 .0 5
EARNINGS, EXPENSES, AND DIVIDENDS OF NATIONAL B A M S I2T THE SIX MOUTHS
ENDED JUNE 3 0 , 1 9 4 2 , AND SEMIANNUALLY IN THE CALENDAR YEAR 19 4l.
(Amounts in thousands of dollars)
............
*________ Six months ended
:Year ended
l June 30* ? June 30»* Dec. 31» : Dec. 31»
i
1942
:
iq4l :
iq4l
:
iq4l
Capital stock* par value? 1/
Preferred . . . ............ , . . . $152,379
$1 8 ^U)+l
$1 6 9 .3 0 3
$1 6 9 ,3 0 3
Common . . ................ . . . 1,356.521 1.3U0.705 1.351.981 1,351,981
TOTAL CAPITAL STOCK. . . . . . . 1,508-,900 1 .5 2 5 ,1^ 6 i,521,2g4 1,521,284
Capital funds 1J .................. 3,679,% 2
3,598,l4i 3 .05^,300 3 ,656,300
Gross operating earnings?
Interest and discount on loans . .
224,104
237,084
220,382
457,466
Interest and dividends on bonds
and securities ................
161,623
1^1,772
291,984
150,212
Trust department ................
15.096
33.322
18,087
15.235
Service charges on deposit accounts
23,246
22,485
21,726
44,211
Rent received.................. ..
26,201
26,046
26,442
52,488
Other earnings........ .
46.192
20,563 _ 21,589
24,603
TOTAL GROSS OPERATING EARNINGS . . " N o ,833
1&6.750
*¿78.913
925,663
Gross operating expenses?
. Salaries and wages—
Officers . ....................
52,5^8
56,196
5^.817
108,71+1*
Employees other than officers. .
86,617
77.1*36
85.877
163,313
Interest on time and savings
deposits .......... ..........
50,484
1*5.631
1*8,715
99.199
Real estate taxes................
10,111
10,1+52
9.737
20,563
Other taxes.
27,306
39.7^9
37.265
61*.571
Other expenses
;
90,892 .. 9^.366
97,625
185,258
TOTAL GROSS OPERATING EXPENSES .
. 339,176
641,648
308,777
332,871
NET OPERATING EARNINGS ............
146,042
Í36.657
.137,973
2S4,015
Recoveries:
On loans........................
19,008
1*3.658
18,335
25.323
On bonds and securities ..........
18,066
25,649
22,508
1+8,157
All other . . ....................
6,454
1 U.96I+
8,510
.5.1*27
TOTAL RECOVERIES.......... . . . .
42,501
47,297
59,f82
106,779
Profits on securities sold........
16,275
3 8 , 64g
4 Í .3 3 5
7 9 ,9 8 3
’ TOTAL RECOVERIES AND PROFITS
------------- --------ON SECURITIES SOLD............
58.776 ..85,91*5
186,762
100,817
Losses and depreciation?
On l o a n s ................ .. .
21,856
23.235
28,754
51.989
On bonds and securities. . . . . .
48,06l
92.131+
38,730
i+i*.073
On banking house, furniture and
fixtures ......................
14,528
33.862
13.192
19 .331+
All other. . ....................
9.038 ... 9 .29 s
14.1Q9
23.1*97
TOTAL LOSSES AND DEPRECIATION. .
82,816
110,3^8
201,482
.. 91 .131*
NET PROFITS BEFORE DIVIDENDS . . . .
132,784
112,617
136,511
269,295
issue or on subsequent purchase, and the amount actually received either
upon sale or redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss*
Treasury Department Circular No* 418, as amended, and this
notice, prescribe the terms of the Treasury bills and govern the condi
tions of their issue*
Copies of the circular may be obtained from any
Federal Heserve Bank or Branch*
o
O
A
XKMBBnnr
- 2 Reserve Ranks and Branches,,following which public announcement will be made
by the Secretary of the Treasury of the amount and price range of accepted
bids.
Those submitting tenders will be advised of the acceptance or rejec
tion thereof.
The Secretary of the Treasury expressly reserves the right
to accept or reject any or all tenders, in whole or in part, and his action
in any such respect shall be final.
Payment of accepted tenders at the
prices offered must be made or completed at the Federal Reserve Bank in
cash or other immediately available funds on
September 30» 1942
,
.
lipp
The income derived from Treasury bills, whether interest or gain
from the sale or other disposition of the bills, shall not have any exemption,
as such, and loss from the sale or other disposition of Treasury bills shall
not have any special treatment, as such, under Federal tax Acts now or here
after enacted.
The bills shall be subject to estate, inheritance, gift, or
other excise taxes, whether Federal or State, but shall be exempt from all
taxation now or hereafter imposed on the principal or interest thereof by
any State, or any of the possessions of the United States, or by any local
taxing authority.
For purposes of taxation the amount of discount at which
Treasury bills are originally sold by the United States shall be considered
to be interest.
Under Sections 42 and 117 (a) (l) of the Internal Revenue
Code, as amended by Section 115 of the Revenue Act of 1941, the amount of
discount at which bills issued hereunder are sold shall not be considered
to accrue until such bills shall be sold, redeemed or otherwise disposed
of, and such bills are excluded from consideration as capital assets*
Accordingly, the owner of Treasury bills (other than life insurance com
panies) issued hereunder need include in his income tax return only the
difference between the price paid for such bills, whether on original
TREASURY DEPARTMENT
Washington
>v*
"7
1
*(
O
FOR RELEASE, MORNING- NEWSPAPERS,
Friday, September 25, 1942
jptà
The Secretary of the treasury, hy this public notice, invites tenders
for $ ;,oo ODOjOOP
, or thereabouts, of
91 "day Treasury hills, to he issued
on a discount basis under competitive bidding.
be dated
September 30« 1942
The Dills of this series will
and will mature
December 30« 1942
:&^bc
when the face amount will be payable without interest.
They will be issued in
bearer form only, and in denominations of $1,000, ip-5,000, $10,000, $100,000,
$500,000, and $1,000,000 (maturity value).
I
Tenders will be received at Federal Reserve Banks and Branches up to the 1
War
closing hour, W o o'clock p, a „ Eastern SSSffi«*» time, Monday, September 28, l?tf, j
Tenders will not be received at the Treasury Department, Washington.
Each tender 1
must be for an even multiple of $1,000, and the price offered must be expressed
on the basis of 100, with not more than three decimals, e. g., 99.925.
may not be used.
Fractions j
It is urged that tenders be made on the pointed forms and for
warded in the special envelopes which will be supplied by Federal. Reserve Banks
or Branches on application therefor.
Tenders will be received without deposit from incorporated banks and
trust companies and from responsible and recognized dealers in investment securities.
I
<
j
Tenders from others must be accompanied by payment of 10 percent of the
face amount of Treasury bills applied for, unless the tenders are accompanied hy
an express guaranty of payment by an incorporated bank or trust company.
Immediately after the closing hour, tenders will be opened at the Federal
TREASURY D E P A R T M E N T ■
Washington
F O R R E L E A S E , MORNING- N E W S P A P E R S ,
F r i d a y , S e p t e m b e r 25, 19^2.
jmM
The
vites
Secretary
tenders
f o r "1 ^ 00, 000, 000,. o r
T r e a s u r y bi l l s ,
tive bidding.
ber
JO,. 19^2,
of t he T r e a s u r y ,
to b e
The bills
of t h i s
thereabouts,
and
30, 19I+2,
interest.
in d e n o m i n a t i o n s
$ 10 , 000, $ 100, 000, $ 500, 000, a n d
11,7-------
of
notice,
in
91- d a y
basis under
series will be
and will mature D e c e m b e r
f o r m only,
—
this public
Issued on a discount
amount will be payable without
.in b e a r e r
by
—
competi
dated Septem
when
T h e y w i l l be
t he
face
issued
o f # 1 , 000, .$5 ,000,
$ 1 , 000,000 ( m a t u r i t y v a l u e ) .
T e n d e r s w i l l b e r e c e i v e d at F e d e r a l R e s e r v e B a n k s a n d
B r a n c h e s u p to t h e c l o s i n g hour, two o ' c l o c k p.m., E a s t e r n W a r
time, M o n d a y , S e p t e m b e r 28> 19^+2,
T e n d e r s w i l l n o t be r e c e i v e d
at t h e T r e a s u r y D e p a r t m e n t , W a s h i n g t o n ,
E a c h t e n d e r m u s t be
f o r an e v e n m u l t i p l e o f $ 1 , 000, a n d the p r i c e o f f e r e d m u s t be
e x p r e s s e d on the b a s i s of 100,' w i t h n o t m o r e t h a n t h r e e d é c i
mais, e. g . , 19 9 . 9 2 5 ,
F r a c t i o n s m a y n o t - h e u sed.
It is u r g e d ’
that t e n d e r s be m a d e o n the p r i n t e d f o r m s ’a n d f o r w a r d e d -in the
special envelopes w h i c h will be supplied by Federal Reserve
B a n k s or B r a n c h e s o n a p p l i c a t i o n t h e r e f o r .
Tenders will be received without deposit from incorporated
b a n k s and t r u s t c o m p a n i e s a n d f r o m r e s p o n s i b l e a n d r e c o g n i z e d
d e a l e r s in i n v e s t m e n t s e c u r i t i e s .
T e n d e r s f r o m o t h e r s m u s t be
a c c o m p a n i e d b y p a y m e n t of 10 p e r c e n t of the f a c e a m o u n t of
T r e a s u r y b i l l s a p p l i e d for, u n l e s s t h e t e n d e r s a r e a c c o m p a n i e d
b y an e x p r e s s g u a r a n t y of p a y m e n t b y an I n c o r p o r a t e d b a n k or
trust company.
I m m e d i a t e l y a f t e r the c l o s i n g h o u r , t e n d e r s w i l l b e o p e n e d
at t h e F e d e r a l R e s e r v e B a n k s a n d B r a n c h e s , f o l l o w i n g w h i c h p u b
lic a n n o u n c e m e n t w i l l be m a d e b y t h e S e c r e t a r y of t he T r e a s u r y
of the a m o u n t a n d p r i c e r a n g e of a c c e p t e d b i d s .
Those sub
m i t t i n g t e n d e r s w i l l b e a d v i s e d of t h e a c c e p t a n c e o r r e j e c t i o n
thereof.
T h e S e c r e t a r y of the T r e a s u r y e x p r e s s l y r e s e r v e s the
r i g h t to a c c e p t o r r e j e c t a n y or a l l t e n d e r s , in w h o l e or in
part, a n d h i s a c t i o n in a n y s u c h r e s p e c t s h a l l be f i n a l ,
Pay
m e n t of a c c e p t e d t e n d e r s at t he p r i c e s o f f e r e d m u s t be made' or
c o m p l e t e d at t h e F e d e r a l R e s e r v e B a n k in c a s h o r o t h e r i m m e
d i a t e l y a v a i l a b l e f u n d s on S e p t e m b e r 30» 19^-2 .
33-i+cr
(o v e r )
2
The income de r i v e d from T r e a s u r y bills, w h e t h e r interest
or g a i n f r o m t h e s a l e or. o t h e r d i s p o s i t i o n of t h e b i l l s , shall
n o t h a v e a n y e x e m p t i o n , as such, a n d l o s s f r o m the sale o r other
d i s p o s i t i o n of T r e a s u r y b i l l s s h a l l not h a v e a n y s p e c i a l t r e a t
m ent, as such, u n d e r F e d e r a l t a x A c t s n o w o r h e r e a f t e r enacted.
T h e b i l l s s h a l l be s u b j e c t to e s t a t e , i n h e r i t a n c e , gift, o r
o t h e r excise taxes, w h e t h e r F e d eral or State, b u t shall be
exempt f r o m all t a x a t i o n n o w or h e r e a f t e r i m p o s e d on the p r i n
cipal or i n t erest t h e reof b y any State, o r any of the p o s s e s
sions of the U n i t e d States, or by an y l o cal t a x i n g authority.
F o r p u r p o s e s of t a x a t i o n the amount of d i s c o u n t at w h i c h
T r e a s u r y b i l l s are o r i g i n a l l y sold b y the U n i t e d S t ates shall
be c o n s i d e r e d to be interest.
U n d e r S e c t i o n s 42 a n d 117 (a) (1)
of the I n t e r n a l R e v e n u e Code, as a m e n d e d b y S e c t i o n 115 of the
R e v e n u e A c t o f 1941, the amount of d i s c o u n t at w h i c h bills
i s sued h e r e u n d e r are sold shall not be c o n s i d e r e d to accrue
u n t i l suc h b i lls shall be sold, r e d e e m e d or o t h e r w i s e disposed
of, and s u c h b i l l s are ex c l u d e d f r o m c o n s i d e r a t i o n as capital
assets.
Accordingly,, the o w n e r of T r e a s u r y b i lls (other than
life i n s u r a n c e c o m p a n i e s ) i s s u e d h e r e u n d e r n e e d Include in his
inco m e t a x r e t u r n o n l y . t h e d i f f e r e n c e b e t w e e n the p r i c e paid
f o r s u c h bills, w h e t h e r on o r i g i n a l issue or on s ubsequent
purchase, and. t h e , a m o u n t ac t u a l l y r e c e i v e d e i t h e r u p o n sale or
r e d e m p t i o n at m a t u r i t y d u r i n g the t a x a b l e y e a r f o r w h i c h the
r e t u r n is made, as o r d i n a r y g a m or loss.
T r e a s u r y D e p a r t m e n t C i r c u l a r No. 4lg, as amended, and this
notice, p r e s c r i b e the terms of. the T r e a s u r y b i l l s a n d govern the
c o n d i t i o n s of t h e i r issue.
C o pies of the c i r c u l a r m a y be o b
t a i n e d f r o m any Federal. R e s e r v e B a n k o r Branch.
-0 O 0 -
TREASURY DEPARTMENT
Washington
POR RELEASE, MORNING NEWSPAPERS,
Friday, October R, 1942.
10/1/42
The Secretary of the Treasury, by this public notice, in
vites tenders for $400,000,000, or thereabouts, of 91-day.
Treasury bills, to be issued on a discount basis under compe
titive bidding.
The bills of this series will be dated October
7, 1942j and will mature January 6, 1943, when the face amount
will be payable without interest.
They will be issued in
bearer form only, and in denominations of $1,000, $5,000,
$10,000, $100,000, $500,000, and $1,000,000 (maturity value).
Tenders will be received at Federal Reserve Banks and.
Branches up to the closing hour, two o’clock p. m., Eastern
V/ar time, Monday October 5? 1942, Tenders will not be received
at the Treasury Department, Washington. Each tender must be
for an even multiple of $1,000, and the price offered must be
expressed on the basis of 100, with not more than three deci
mals, e. g., 99.925. Fractions may not be used. It is urged
that tenders be made on the printed forms and forwarded in the
special envelopes which will be supplied by Federal Reserve
Banks or Branches on application therefor.
Tenders will be received without deposit from incorporated
banks and trust companies and from responsible and recognized
dealers in investment securities. Tenders from others must be
accompanied by payment of 10 percent of the face amount of
Treasury bills applied for, unless the tenders are accompanied
by an express guaranty of payment by an incorporated bank or .
trust company.
Immediately after the closing hour, tenders will be opened
at the Federal Reserve Banks and Branches, following which pub
lic announcement will be made by the Secretary.of the Treasury
of the amount and price range' of accepted bids. Those submit
ting tenders will be advised of the acceptance or rejection
thereof. The Secretary of the Treasury expressly reserves the
right to accept or reject any or all tenders, in whole or in
part, and his action in any such respect shall be final. Pay
ment of accepted tenders at the prices offered must be made or
completed at the Federal Reserve Bank in cash or other imme
diately available funds on October 7? 1942.
(Over)
33-41
2
The income derived from Treasury bills, whether interest
or gain from the sale or other disposition of the bills, shall
not have any exemption, as such, and loss from,the sale or
other disposition of Treasury bills shall not have any special
treatment, as such, under federal tax Acts now or hereafter
enacted. The bills shall be subject to estate, inheritance,
gift, or other excise taxes, whether federal or State, but shall
be exempt from all taxation now or hereafter imposed on the
principal or interest thereof by any State, or any of the pos
sessions of the United States, or by any local taxing authority,
for purposes of taxation the amount of discount at which
Treasury bills are originally sold by the United States shall
be considered to be interest. Under Sections 42 and 117 (a)
(1) of the Internal Revenue Code, as amended by Section 115 of
the Revenue Act of 1941, the amount of discount at which bills
issued hereunder are sold shall not be considered to accrue
until such bills shall be sold, redeemed or otherwise disposed
of, and such bills are excluded from consideration as capital
assets. Accordingly, the owner of Treasury bills (other than
life insurance companies) issued hereunder need include in his
income tax return only the difference between the price paid
for such bills, whether on original issue or on subsequent
purchase, and the amount actually received either upon sale or
redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss.
Treasury Department Circular No. 418, as amended, and this
notice, prescribe the terms of the Treasury bills and govern
the conditions of their issue. Copies of the circular may be
obtained from any federal Reserve Bank or Branch.
-oOo-
<
\
4
- 3 -
issue or on subsequent purchase, and the amount actually received either
upon sale or redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss*
Treasury Department Circular No* 418, as amended, and this
notice, prescribe the terms of the Treasury bills and govern the condi
tions of their issue*
Copies of the circular may be obtained from any
Federal He serve Bank or Branch*
o
0
o
11
-
2
-
Reserve Banks and Branchesj,following which public announcement will be made
by the Secretary of the Treasury of the amount and price range of accepted
bids*
Those submitting tenders will be advised of the acceptance or rejec
tion thereof.
The Secretary of the Treasury expressly reserves the right
to accept or reject any or all tenders, in whole or in part, and his action
in any such respect shall be final*
Payment of accepted tenders at the
nrices offered must be made or completed at the Federal Reserve Bank in
cash or other immediately available funds on
October 7 ,
---------- •
The income derived from Treasury bills, whether interest or gain
from the sale or other disposition of the bills, shall not have any exemption,
as such, and loss from the sale or other disposition of Treasury bills shall
'
not have any special treatment, as such, under Federal tax Acts now or hereafter enacted.
9
.
The bills shall be subject to estate, inheritance, gift, or
<
other excise taxes, whether Federal or State, but shall be exempt from all
taxation now or hereafter imposed on the principal or interest thereof by
any State, or any of the possessions of the United States, or by any local
taxing authority.
For purposes of taxation the amount of discount at which
Treasury bills are originally sold by the United States shall be considered
to be interest.
Under Sections 42 and 117 (a) (l) of the Internal Revenue
Code, as amended by Section 115 of the Revenue Act of 1941, the amount of
discount at which bills issued hereunder are sold shall not be considered
to accrue until such bills shall be sold, redeemed or otherwise disposed
of, and such bills are excluded from consideration as capital assets.
Accordingly, the owner of Treasury bills (other than life insurance com
panies) issued hereunder need include in his income tax return only the
difference between the price paid for such bills, whether on original
Sft
U
M
-Cf (
Washington
FOR RELEASE, MORNING NEWSPAPERS,
Fri day , October 2, 1942________.
x&kk
The Secretai'y of the treasury, "by this public notice, invites tenders
for $¿00.000.000
, or thereabouts, of
91 ~day Treasury "bills, to "be issued
on a discount "basis under competitive bidding.
be dated
The Dills of this series will
October 7. 1942____ , and will mature _____ January
6,
1.9.43---------->
h k )c
when the face amount will be payable without interest.
They will be issued in
bearer form only, and in denominations of $1,000, $5,000, $10,000, $100,000,
$500,000, and $1,000,000 (maturity value).
Tenders will be received at Federal Reserve hanks and Branches up to the
in'
i
closing hour, two o^lock p. m., Eastern
time, Monday, October
1%£__,„„,
Tenders will not be received at the Treasury Department, Washington,
Each tender
must be for an even multiple of $1,000, and the price offered must be expressed
on the basis of 100, with not more than three decimals, e. g.f 99.925.
may not be used.
Fractions j
It is urged that tenders be made on the pointed forms and for
warded in the special envelopes which will be supplied by Federal Reserve Banks
or Branches on application therefor.
Tenders will be received without deposit from incorporated banks and
trust companies and from responsible and recognized dealers in investment securities.
Tenders from others must be accompanied by payment of 10 percent of the
I
face amount of Treasury bills applied for, unless the tenders are accompanied hy
an express guaranty of payment by an incorporated bank or trust company.
A
Immediately after the closing hour, tenders will be opened at the FederaB
the hoys and the girls in our schools can do their part
to preserve the liberties our forefathers created in
Independence Hall#
In this spirit, I accept on behalf of the Treasury
this historic brick from the Liberty Bell Tower.
And
I should like especially to thank the people of Philadelphia,
and the Mayor of Philadelphia, for sharing with the school
children of America this priceless trophy of a liberty-
loving people.
It will remain here In the national capital to
remind future generations that American boys and girls,
as well as their fathers and mothers, have always had
the courage and the strength and the will to fight
for their freedom
* z
•
Islands,* so did our sailors and •our airman at Midway
and in the Coral Sea«
Yes —
and it is being paid again by the women
of America and their children.
( ‘ / g|lj'ii...
Once again, our women
1
are showing-'that t h e x ^ ^ Hteaew’-heir to scrimp and
to sacrifice, and to keep the homes together while
the men fight or make the weapons to fight with.
For this is no cheap and easy war that we are
now forced to fight.
world has ever known.
It is the greatest war the
It is total war.
And every
4
one of us —
from the oldest worker to the youngest
school child —
is in the fight.
That is why this brick from Independence Hall
makes a fitting symbol for the war effort of our
American schools.
Through the "Schools at War" program,
/ ^
3
j
DBAFT OF SECRETARY MORCENTHAU'S TALK TO THE
CELEBRATION, SEPTEMBER 25, 1942.
"SCHOOLS AT WAR"
This brick
from
Independence Hall is part of our
heritage of American liberty.
It reminds us of the
great statesmen and fighting men who first won our
freedom in the war of the Revolution*
And today it reminds us also that this freedom
was not cheaply or easily won*
Our forefathers had
to pay a price for the liberty we are now enjoying*
That price was paid by the soldiers who died
at Bunker Hill and Valley Forge.
It was paid by the
Colonial women who scrimped and sacrificed, and raised
the children and kept the homes together, while their
men were away winning our independence*
That price is being paid again today.
on Bataan paid it.
Our soldiers
So did our marines on the Solomon
111
D-B
3 3 ~
l v
Remarks of Secretary Morgenthau at the Opening of
the "SCHOOLS AT WAR" Program on the Treasury Steps
September 25, 1942
This brick from Independence Hall is part of our heritage of
American liberty« It reminds us of the great statesmen and fighting
men who first won our freedom in the war of the Revolution.
And today it reminds us also that this freedom was not cheaply
or easily won. Our forefathers had to pay a price for the liberty
we are now enjoying.
^
That price was paid by the soldiers who died at Bunker Hill and
Valley^orge. It was paid by the Colonial women who scrimped and
sacrificed, and raised the children and kept the homes together,
while their men were away winning our independence.
That price is being paid again today. Our soldiers on Bataan
paid it. So did our marines on the Solomon Islands, so did our
sailors and our airmen at Midway and in the Coral Sea.
. ^®
^ -*-s being paid again by the women of America and
their children. Once again, our women are being called, upon to
scrimp and to sacrifice, and to keep the homes together while the
men fight or make the weapon# to fight with.
For this is no cheap and easy war that we are now forced to
fight. It is the greatest war the world has ever known • It is tot al
war. And every one of us — from the oldest worker to the youngest
school child — is in the fight.
That is why this brick from Independence Hall makes a fitting
symbol for the war effort of our American schools. Through the
_Schools at War# program, the boys and the girls in our schools can
do their part to preserve the liberties our forefathers created in
Independence Hall.
in this spirit, I accept on behalf of the Treasury this historic
brick from the Liberty Bell Tower. And I should like especially to
thanK the people of Philadelphia, and the Mayor of Philadelphia, for
sharing with the school children of America this priceless troohy of
a liberty-loving people.
It^will remain here in the national capital to remind future
generations that American boys and girls , as well as their fathers
and mothers, have always had the courage and the strength and the
will to fight for their freedom.
Oü
Controversies over Methods of War Taxation
An address by Randolph E. Paul, General Counsel,
United States Treasury, at Bronxville, New York,
September 2 5 , 1942
You have asked ne to discuss with you today some
controversies about the types of taxes that should be
the war. The fact that Congressional committees have
on the Revenue Rill of 1942 for more than six months,
the Bill is not yet complete, give some indication of
depth of these controversies.
of the current
used to finance
been hard at work
and the fact that
the scope and
The formulation of a sound tax program is a complex task. It is
made doubly difficult by existing circumstances* A sound tax must meet
many requirements. Some of these requirements are not mutually antago
nistic, and can be achieved at the same time in full degree. Other tax
objectives, however, are in conflict with each other. The achievement
of one objective may of necessity involve failure to achieve another.
In arriving at a tax policy, we must weigh these objectives and. determine
■which we are most anxious to achieve or what combination will most nearly
meet our idea of a desirable tax program.
vie should all agree that our tax po?JLcy must meet one test above all
others. It must contribute to our primary economic objective — supplyin
our armies with as much of the finest equipment ,as is necessary in order
to win a complete victory. The attainment of this objective Will require
action along many fronts. Taxation is one of the most important of these
It must be used to the utmost to stave off inflationary price rises.which
would seriously disrupt the economic system, and it must do this while
at the same time being imposed fairly and equitably so as to maintain the
morale of our workers, without which productive efficiency is impossible.
In considering additional sources of revenue, then, we arc faced
with tyro major considerations: Yfhat is the effect of the proposed method
of raising money upon the problem of inflation? And how does the method
proposed distribute the economic burden of the war?
It is in attempting to answer these questions that controversies
over tax methods arise. For different taxes have different effects, and
opinions may differ even as to the effects of any particular type of tax.
For example, a tax on accumulated fortunes would have far less effect on
the inflation problem than a tax which removed a like amount from current
individual spending. Similarly, the elimination of tax loopholes, such
as tax-exempt interest which benefit only a few, will have a more salutary
effect on taxpayer morale than a regressive measure which would burden
the many.
- 2 -
The unprecedented amounts of revenue that will be needed in order
to pay for this war give some idea of the magnitude of our task. Ex
penditures are running at more than $150 million per day — $75 billion
for this fiscal year. Something more than half of our resources will
soon be devoted to the production of instruments of war* One out of
every two wage earners m i l be receiving income for contributing to the
production of goods that he cannot purchase. Unless we utilize to the
utmost all possible controls, the excess of purchasing power over the
volume of consumer goods produced must lead to a rise in prices. And
such a rise would add immeasurably to the monetary costs, and to the
hardships of war.
One of the best ways to combat inflation is to reduce the amount that
consumers can spend. Inflation, itself, does not reduce the quantity of
goods available for people to buy; but it does change the distribution of
those goods in a very unfair manner. If goods wiiich could be bought last
year for $100 now sold for $200* those in the low income groups could buy
only half as much as before. Thus, they would be deprived of goods which
they should have, while leaving more of an already scanty supply for people
who can afford to pay the increased prices.
What we must devise is a moans which m i l not only reduce the demand
for goods, but also distribute that reduction in an equitable manner.
Income Taxation
In the field of income taxation there are those who would place
primary emphasis on extending taxation on the large incomes. From the
standpoint of taxpayer’s morale and tax equity, high income tax rates
on persons with large incomes arc extremely important. These rates should
be raised to the utmost limits, not only through high nominal rates, but
also through closing tax loopholes so as to make the high rates fully
effective. At present several serious means of avoidance exist in the law
which defeat the equity of any rate scale, I need mention only one example
today — tax-exempt securities,
I doubt whether the effort to eliminate any other tax loophole has
caused as much discussion and controversy as has the Treasury recommenda
tion that all interest on State and local securities be made subject to
income tax, I am glad to be able to tell you that the Senate Finance
Committee has voted to eliminate this exemption with respect to future
issues of State and local securities. It is to be hoped that this pro
vision will survive in the Revenue Act of 19A2,
- 3 -
The Senate action represents, however, only part of the job that
needs to be done, since interest on issues now outstanding will continue
to be exempt from all Federal income taxes* This continued exemption
constitutes a serious breach in our system of taxing according to ability to pay* For example, a survey of twenty-five actual returns for the tax
able year 194-0 revealed that if the rate scale proposed by the Treasury
were applied to the tax-exempt as well as the taxable income reported on
these returns, the aggregate tax liabilities would be almost doubled*
This glaring unfairness will increase as taxes increase and the high rates
tempt more and more wealthy individuals to shift their investments to
tax-exempt securities* How can such an exemption be justified when we
are calling upon every citizen to share in the burden of war?
The continuation of this glaring inequity is justified on the spurious
grounds that its elimination Yrould be unconstitutional and would involve
a breach of faith. Needless to say, the Treasury carefully investigated
the legal problem before recommending the taxation of outstanding issues.
Vie have satisfied ourselves that there is no constitutional obstacle*
Further,'in order to insure an authoratative and objective study of the
question, we asked the Attorney General Gf the United States to study the
question. He has given us his opinion that there is no legal bar to the
taxation of interest on outstanding issues of State and local securities*
Few of us are experts on the legal issue involved, but all of us are
competent to judge the moral issue. The great bulk of all outstanding
State and local securities was purchased when tax rates were far lower
than they now are or than they will be in the next few years. Few of the
purchasers could nave anticipated our participation in a world war of
unprecedented scope, and the accompanying tax burdens. Is it a breach
of faith to levy war-time taxes on the income from securities purchased
with the belief that they were tax-exempt but with no expectation that
taxes would reach their present levels? If so, it seems no less a breach
of faith to levy wartime taxes on income from other long-term contracts
entered into in happier days when taxes were expected to remain low*
The purchasers of State and local securities knew they were purchasing
tax shelters; they certainly did not know they were purchasing bomb-proof
tax shelters*
As I have said, heavy taxation of the wealthy is essential. It is,
however, accepted by all that in order to finance the war and control
inflation, a tax burden much heavier than the present one must be planed
upon those with small incomes. But there is wide controversy as to the
best means of taxing such persons.
The new tax bill goes a long way toward the taxation of small
incomes. Individual income tax exemptions are lowered to $ 5 0 0 for
single persons, $1 , 2 0 0 for married persons and $ 3 0 0 for dependents#
The minimum combined normal and surtax rates applicable to net income
above these exemptions is 19 percent. In addition, the Senate Finance
Committee has voted a so-called "Victory" tax, a flat tax of 5 percent
on individual gross incomes in excess of $6 2 4 #
During the next year of the war even greater amounts of revenue will
be needed from the income tax. Hates may go higher and exemptions lower.
Collection at the Source
As the number of income taxpayers and the income tax burden increases,
it becomes necessary for the Government to provide the means by which
payment of the tax may be made with a minimum- of delay. Toward this end,
the Treasury has recommended that beginning with January 1, 1943, part of
the income tax be collected at the source. The income tax rates contained
in the Bill under consideration by the Congress at the present time begin
at 19 percent (normal and surtax combined) on the first dollar of income
above the exemptions. The rates are rapidly progressive as they must be
to raise in an equitable way the amount of revenue that needs to come from
tne income tax. The result may be a tax burden which many persons yo .11
find very difficult to meet under the present method of payment.
At present individuals pay their tax in the year following the receipt
of their income on which the tax is levied* Most persons, especially those
in the middle and lower income brackets, make little, if any, advance pro
vision for their tax liabilities by building up reserves during the year
when the income is being earned. They are therefore obliged to pay the
tax^in at most four quarterly installments out of the income of the fol
lowing year. These installments are in many cases very hard to meet
because they have not been built up wreck by week, or month by month.
Furtnermore, in many cases, the income of the following year is less than
the income of the taxable year and, accordingly, tax liability must bo
met out of the smaller income. This problem threatens to be particularly
acute in the period immediately following the war. Many will suffer large
declines in income, and yet be obligated to pay heavy taxes on their ■war
time incomes.
From the Government's standpoint, collection at source means prompter
collection, more accurate reporting, and less avoidance.
- 5 -
Finally, and unquestionably most important for the immediate
future, is the relation of collection at source to the problem of
inflation control. In order to contribute to the control of inflation,
taxes must become effective at the earliest possible time. Under
present methods of payment an increase in income taxes enacted now will
not affect tax payments until March, 1943# By the time the higher taxes
are paid, the inflationary damage may be done. Collection at source will
very largely eliminate this lag, since collections under the increased
rates could begin much earlier.
The Tax Burden of the Lower Income Group
Some argue that even if rates were raised, exemptions further re
duced, and loopholes eliminated, many would still be free from direct
Federal taxation, and that this is without justification. They feel that
it is desirable that every individual in the community, regardless of his
income, be required to pay part of the additional taxes. The Treasury,
however, has taken a different view, and has endeavored to formulate a
tax policy which recognizes that there are large groups in the community
whose standards of living are- so low, that they should not be called upon
to pay any more than the substantial amount of taxes they are now required
to pay*
Admittedly, there is no such thing as an absolute minimum standard of
living. Standards of living must be adjusted to the volume of consumer
goods and services available. But it is one thing to say that w o must
adjust our notions of the minimum standard of living to the changed situa
tion; it is a very different thing to say that we must discard completely
the idea that there is a group in our community with standards of living
so low that we cannot afford to reduce them still further.
The protection of groups with low living standards involves more than
mere fairness or equity — important though they are. We shall lose more
than we gain, if we so reduce the standard of living of our citizens as to
impair their morale and their productive efficiency.
Our people are ready to pay the price that the war imposes. They are
ready to bear its heavy burdens. But they do demand, and quite properly,
that these burdens bo distributed fairly; that we count not heads, but the
ability of individuals to share in the cost.
— 6 -
The Sales Tax
/
The "Victory" tax which X have mentioned is an effort to place a
direct tax burden upon 40 million persons many of whom are not no?*- subject
to any direct Federal taxes. Another widely discussed means of reaching
the whole populace and of tapping mass purchasing power is the sales tax.
But how docs such a tax affect inflation and how would it operate to
distribute the economic burden of the war?
The sales tax distributes the cost of the war in an extremely inequit
able manner. The sales tax falls heaviest on individuals with the lowest
standards of living, since such individuals are forced to spend all of their
income on the basic necessities of life. The sales tax falls least heavily
on persons whoso incomes leave them a substantial margin for savings or
for luxury spending* No one would propose that wc enact an’income tax
without exemptions at a rate of 10 percent on a $ 5 0 0 income, at a'rate of
6 percent on a $¿2,500 income, and at a rate of 3 percent on a $10,000 in
come.^ Yet such a proposal would distribute the burden in the same way
as a flat 10 percent retail sales tax. The only difference is in name,
not in substance«
A sales tax is too crude an instrument to perform the function of
inflation control. It does not discriminate between persons who can re
duce their^ purchases substantially and persons who cannot do so« In con
sequence, it is impossible to impose a sales tax at sufficiently high
rates to curtail the consumption of persons whose living standards are
liberal, without at the same time levying an intolerable burden on tens
of millions of our citizens. If imposed at low rates, the sales tax yo .11
exercise little or no restraining influence on the persons who are in the
best position to reduce their standards of living«
The suggestion has been made that one m y to surmount the clear in
equity^ of a sales tax would be to permit every person to purchase a speci
fied minimum amount without tax. Apparently the only feasible way to do
this with a sales tax would be to give everyone a book of stamps or coupons
that would be accepted by the retailers in lieu of the tax/ The number of
stamps could be adjusted to the marital and dependency status of the tax
payer.
This proposal would indeed remove one of the most serious defects of
the retail sales tax« It would relieve the pressure of that tao£ at the
point where it bears the hardest and the most unfairly. But the proposal
has difficulties of its own. These become apparent, I think, when we ask
the question, how large should the exemption from tax be? what is the
minimum standard of living below which we should not tax at all? The
answer to that question necessarily varies in different portions of
the country and between citizens who live in rural communities and in
cities. Some can be adequately protected by a smaller exemption than
would be necessary for others. If we fix the exemption at the smaller
amount we leave a substantial burden on millions who should not be asked
to bear it. If we try to meet this fcy fixing the exemption at the higher
amount, then we shall put in the hands of other millions tax exemption
stamps which they do not need and cannot use. These extra stamps would
find a ready market. The net result would be a cash subsidy to some
groups, and greatly reduced tax payments ty other members of the community.
In other words, if the tax exemption is large enough to protect tho-se who
need to be protected, it would result in exempting from the tax far more
than it is really necessary to exempt.
Some figures m i l show the substance of this point. If we gave only
b200 free of tax to every man, woman and child in the country, the free
coupons so distributed would allow more than 026 billion of consumer pur
chases to be made before the tax applied. This is more than half of the
total amount of expenditures that it is feasible to tap by a retail sales
tax.
The sales tax with such an exemption would help to relieve the burden
from the lowest incomes though in a rough and ready sort of way. But on
this basis it would not yield a substantia.1 amount of revenue. It would
not be a significant factor in the fight against inflation. If the diffi
culty resulting from the transferability of the stamps could bo surmounted,
then it would not be necessary to take so much out of the tax base. The
plan might then become capable of an effective part in inflation control.
The results of this device — and much more that we need to do as well
can be Accomplished in a far more straightforward and adequate manner by
means of the spendings tax suggested by the Treasury. I shall turn, there
fore, to a consideration of that tax.
The Spendings Tax
A spendings tax would withdraw money from the purchasing stream in
two ways« In the first place, it would require that all individuals, except
those with the very lowest incomes, turn over to the Treasury a percentage
of the amount they spend. The money so turned over would obviously no
longer be available to compete for the purchase of goods. But a spendings
- 8 -
tax would do more than that* It would also give an incentive to save
rather than to spend* And the money which is saved* though not taken
as tax revenue* would nevertheless be removed iron the spendings stream*
As a major instrument for withdrawing purchasing power directly*
the Treasury proposed that all individuals with incomes above subsistence
levels be required to turn over to the Treasury 10 percent of the amount
they spend. Tie proposed that a married couple with no children be exempt
from this contribution only if their income were loss than $1*000 a yearj
tnat a married couple with two children be exempt only-if their income
wore^less than <¿1*500 a yearj — and that a single person be exempt only
if^his income were less than ‘¿500 a year. The amounts collected under
this tax would be refundable after the war. In addition* there would be
non—refundable graduated spendings surtax with somewhat higher exemptions
designed to discourage luxury spendings*
Thus* the spendings tax accomplishes the desirable end of a sales tax
— namely, reducing the funds available for current consumption — without
T i r irtrVi-n
V»
t •
rm
...
the regrossivity
which
is inherent in sales j______
taxation.
The spendings
tax
makes it possible to apply differential pressure to persons at different
places in the income scale and to discourage high level luxury spending
without at the same time imposing a heavy burden on persons with low
standards of living* In short* the spendings surtax is selective in its
impact* bringing pressure to bear whore pressure is needed*
*
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A Tax on Increased Income of Individuals
Other plans have also been proposed to the Treasury for the combined
purpose'of producing revenue and combating inflation. One of these is a tax
on the increased incomes of individuals* Such a tax has delusive charm.
It is urged that it would impose the burden where the burden can best be
borne* and^where it should in fairness'be borne* upon those who have profited
from war—time salaries and profit increases. It is plainly true that a mere
increase in ordinary income tax rates is far from equal in its operation*
Large elements of our population have reduced incomes at this time resulting
from the many war-time dislocations* To impose increased income taxes upon
them is to add to the burdens which they already carry. Some system which
would throw a larger part of this burden on incomes which have in fact
increased would have elements of appeal*
Nevertheless* such a tax would itself introduce many elements of un
fairness* It would mean that two persons receiving* say* $4*000 a year
would pay far different amounts of tax because one had always received
- 9 -
$4,000 a year while the other had only received $2,000 in earlier years.
It would not be easy to tell the *>2,000 man that he must now pay more
taxes than the ^4,000 man even though their incomes are the some, because
his had formerly been less. He would be likely to reply, and with some
reason, that he was less able to pay the tax now than the other man because
he had gone through the previous years with much less margin.
The administrative difficulties of such a tax would also be very
great. It would introduce into every individual income tax return many
of the complexities of the excess profits tax, with determinations of
pre-war base period income, with complicated adjustments analogous to
those in the corporation excess profits tax, and so on* It is hard to
believe that it would not be widely evaded. It would certainly greatly
increase the problems of auditing and policing the smaller individual
income tax returns.
Conclusion
Those and other controversies which exist in the field of taxation
are in themselves evidences of the democratic method for which we fight
—— the right to a free discussion, without rancor, of the issues involved
in an attempt to devise the best possible solution for the people as a
whole. No tax or tax system can be perfect. As Edmund Burke said* MTo
tax and to please, no more than to love and to be wise, is not given to
men." Many tax matters are problems of judgment — the weighing and
balancing of meters against each other. It is necessary to decide which
fact', rs are the most- important and to adapt the fiscal program to the
most important objective. Discussion and thought on these subjects by
persons within and without the Government are of inestimable assistance
in reaching this goal*
Taxation in War Time
An Address by Randolph E. Paul, General Counsel,
United States Treasury, before the National Lawyers' Guild,
New York City, September 26, 1942
Planes, ships, guns, and tanks are needed in unprecedented
numbers to win this war. Whatever is needed by the armed forces
will be produced and will be delivered just as rapidly as possible.
And those who deliver these instruments of war will receive their
checks promptly from the United States Treasury. These are settled
matters and require no discussion. The vital issue, however* still
remains: Iiow and from whom will we raise the money to meet the
costs? How much from taxation? How much from borrowing? What kind
of taxation? ’»hat kind of borrowing?
The answers to these questions will determine in large part,
whether the cost of the war is distributed fairly, and whether war
production leaves a wake of destructive war inflation. If we take,
the easy course of inflation, morale and efficiency will be impaired,
production will be retarded, and the problem of post-war adjustments
will be magnified. If we take the hard course of stiff taxes on
incomes and spendings, the threat of inflation will be reduced,
production will be able to reach the peak of which it is physically
capable, and post-war adjustments will be facilitated.
The Real Cost of Tifar
The real economic cost of the .war is not measured by taxes ,
paid and bonds purchased. Rather it consists of the goods and
services which consumers must forego in order to produce the weapons
of war. The output necessary to wage total war can be provided in
part by working harder5 in part by using resources that were pre
viously unemployedi in part by depleting our peacetime capital
equipment! and in part by drawing on foreign supplies. But these
sources of output have long since proved inadequate. It has been
necessary to curtail the production of civilian goods in order to
produce more war goods. The fact is that the production of instru
ments of war requires more than one-half of our resources, both
human and material. That inevitably means less clothing, less
furniture, less recreation, and less adequate housing.
Thus far, bulging inventories have cushioned the impact of the
coversion from civilian to war production. Although many goods are
being produced at a diminished rate, or are no longer being produced
at all, the retail stores, by and large, have been able to maintain
the stream of goods to consumers out of their stocks. Vihen that
cushion disappears, consumers will be jolted into the realization
that the war is restricting the supply of goods they ordinarily buy.
They will then be face to face with the real cost of the war,— the
cost they cannot escape, the cost they have to pay in one form or
-
2
-
another. They may pay it in the form of higher taxes and compulsory
savings* They may pay it in the form of higher prices for the goods
and services that they can still buy. Or they may pay it by being
unable to spend money because goods and services are rationed or non
existent* But, one way or another, they must pay the real costs of
the war.
Clearly, the cost of the war canndt be shifted to
tions by borrowing instead of taxing. Borrowing does
to transfer goods and services from future generations
No financial sleight-of-hand can empower us to levy on
the goods and services that we sacrifice now.
future genera
not enable us
to the present.
the future for
This is the reason why taxes are not themselves the cost of the
war. They help to distribute among the members of the community
costs that are inevitably there. It is the function of taxation to
distribute these costs in the fairest possible manner while main
taining our economic system in a vigorous position during the war
years and for the post-war period.
The Problem of Inflation
If we fail to distribute the burden of war by taxation, inflation
will step in and do the job for us— and do it badly. Vie cannot escape
the fact that tile ever-increasing flow of money to the market is being
met by a shrinking supply of goods. It could not be otherwise in an
economy in which more than half of the wage-earners are receiving
income for producing goods that they cannot purchase— goods that go,
not to the market, but to the battlefronts of the world. Unless with
drawn by taxes or borrowing, consumer incomes m i l flow to the market
in a stream that will break the dam of price control and rationing.
If our controversies over methods of financing the war ensnare us in
a do-nothing policy, wd. shall be inviting disastrous inflation like
that which ravaged the belligerents after the last war.
Inflation is itself a form of taxation except that the proceeds
are not garnered by the government. It fastens itself to your income
just as surely as the tax demanded by the revenue collector. If in
1943 you pay §1,000 for food, clothing, and shelter that would have
cost §800 in 1942, you are in effect paying a §200 tax. And you
are paying the worst possible kind of tax.
Inflation distributes the cost of the war in a haphazard way,
imposing the heaviest sacrifices on those who can least afford them.
Rising prices hit persons with fixed incomes much harder than those
with rising incomes. They affect persons with low Incomes, Tiho must
ordinarily spend their entire income on purchases of goods and
-3 services, more adversely than .persons with high incomes, who can
maintain their standards of living despite rising prices.
Inflation also disorganizes the economic process» Business is
conducted in terms of prices that are expected to be fairly stable.
Rapid price increases shift the emphasis from production as a source
of profits to speculation and hoarding as sources of profits. The
struggle of labor to keep wages in line with ever-rising prices adds
to the^confusion. If inflation takes precedence over production as
the main concern of business and labor, the war effort will surelv
suffer.
J
Finally, inflation multiplies the monetary costs of the war
and makes the post-war adjustment more difficult.
These are the reasons why inflation, with its costliness,
inefficiency, and brutality, must not be permitted to take the
place of taxation.
It j_s a primary function of war taxa Lion to relieve the spending
pressure which threatens a runaway inflation. It is essential"to
xeduce the volume of money that people try to spend on goods and
services, either directly by withdrawing it from the purchasing
stream, or indirectly by inducing individuals to forego spending in
favor of saving, bar—time fiscal policy, then, must strive to reduce'
the demand for consumer goods and to distribute that reduction equi
tably.
The Tax burden of the Lower Income Groups
Much .of the current tax controversy centers around the role of
the lowest income groups. Many contend that every person should m y
Higher taxes, regardless of the size of his income. They urre that
sacrifices should be universal, and that inflationary pressure cannot
bo removed without tapping the purchasing poorer in the lowest income
groups, m e Treasury takes issue with those who hold this view.
There are large groups in the community whose living standards are '
so low that they should not be required to increase their already
substantial tax payac-nts.
The relevant factors in the controversy can be briefly reviewed!
First, it is eibner implied or stated that every man, woman, and
child must accept a lower standard of living in wartime. Lrc agree
that the concept of what is a minimum standard of living must bo
adjusted to tho demands of war. Vie insist, however, that there is
a group in our community with a standard of living so low that it
cannot be reduced further• There is a point below which additional
taxes cannot^be imposed without exacting unreasonable sacrifices and
causing physical hardship* That point is lower today than it v/as
three or five years ago, and it may be still lower a year or two
hence* But it will never drop to zero*
Second, asiae from the question of fairness or equity, Y/e must
look to the problem of productive efficiency* In wartime the importance
of man as a consumer unit is overshadowed by his importance as a pro
ductive unit*
he should be ill-advised to collect taxes at the expense
of essential vitamins in workers1 lunch pails. That vrould be on par
with denying grease and oil to machines* Taxes which fail to recognize
a minimum exemption level Till impair health and morale and therefore
productive efficiency* The results will show themselves in a weakened
war effort.
*
. . Third, it is contended that the great bulk of consumer spendings
is in the very lowest brackets and can be tapped only by a sales tax or
a gross income tax* This is a dangerous half-truth* The Treasury1s
spendings^ tax^ on single persons vdth income above $500 and on married
persons with income above $1,000 (plus a $250 allov/ancc for each
dependent), would reach over $50 billion out of total consumer spend
ing of '¿>75 billion* In contrast, a retail sales tax on all goods
except food the form of sales tax most frequently advocated— would
reach only slightly more than $30 billion. A tax which taps over twothirds of total spendable income is sufficient in terms of volume to
satisfy present anti—inflationary requirements* Further, it can
serve our^anti-inflationary purposes, without sacrificing recognition
of variations in family size and in personal savings habits*
Fourth, those who oppose the exemption of the lov/est income
groups from war taxes often imply that these groups are not now
paying taxes* ihe oest available estimates all agree that the tax
load, on persons with incomes under $1,000 approximates one—fifth of
their income* Little if any margin for further taxation is apparent
in these figures*
Morale Aspects of War Taxation
War-time fiscal policy must be realistic about the effects of
taxation on morale*
Individual income taxation, for example, has a marked impact
on both civilian and military morale* Unless the rates and exemptions
of income taxation are such that civilians are prevented from profiteer
ing out of the war, men in the armed services, as well as civilians
unselfishly contributing to the war effort, may become restless and
- 5 -
resentful. The existence of special privilege, such as that which
enables holders ox tax-exempt securities, regardless of the size of
their income, to escape taxation— is damaging to morale at any time,
It is doubly so in wartime, Tihen high rates prevail and when
equality of sacrifice is essential to unity, such special privilege
is intolerable.
Excess profits taxes also have important implications for morale.
Like individual income taxes, they are vital in promoting the feeling
tnat comparable sacrifices— at least financially— are being imposed
on all alixe— civilians as well as soldiers# Moreover, taxes on
excess profits have an indirect impact on the problem of inflation.
For labor will not easily be dissuaded from demanding wage increases,
or agriculture from demanding increases in farm prices, so long as
war profiteering is permitted# The Treasury recognized these factors *
in advocating steep excess profits taxes.
Collection at Source
The Treasury has urged the Congress to enact a number of
measures designed to adapt our tax structure to war-time fiscal
needs. One of the most important of these is collection of the net
income tax at source# The income tax is biting harder and deeper
than ever before. With over 30 million people filing returns in
1943, it will be truly a mass tax. As such, it must be adapted to
the needs of the groat bulk of wage-earners and other recipients of
small incomes who are accustomed to budgeting on a weekly or monthly
rather^than on a yearly basis. The best way to do this— and thereby
to minimize hardship for taxpayers and cut down delinquency— is to
provide for the deduction of income taxes currently from pay envelopes,
and from dividend checks.
As passed by the House, the 1942 Revenue Bill provided for the
collection of tax at source from wages, dividends, and interest at a
rate of 5 percent in 1943 and 10 percent thereafter# The amount of
tax collected at source would be based not on the gross amount of
wages but only on that part which was in excess of personal exemptions
and credits. For dividends and interest, it would be based on the
gross amount paid. However, the Treasury has since recommended the
exemption of interest from withholding because it involves special
administrative and compliance problems for only a minor amount of
revenue#
This system of collection at source would not be an additional
tax. It would be simply a means of easing the payment of the regular
income tax. The amounts withheld would be credited against the tax
liability reported on the income tax return filed March 15th. IThcre
collections at source exceeded final tax liability, prompt refunds
would have to be made#
The Senate Finance Committee initially approved the collection-atsource provisions adopted by the House# More recently however, in
endorsing a 5 percent tax on gross income in excess of 0624, the Senate
Finance Committee has decided to recommend the elimination of collection
at source of the net income tax# The Committee, while accepting the
basic principle of collection at source, vould restrict its application
to the 5 percent gross income tax. The 1942 Revenue Act is still in
process, and I am hopeful that in its final form it will provide
for collection at source of the net income tax— the most important
part of our individual income tax structure#
Without collection at source, the income tax is doomed to be an
inflexible instrument of fiscal policy# Under present methods of
collection, changes in rates and exemptions and increases in the
national income are not reflected in tax collection until March of
the following year. Collection at source of the net income tax would
enable the Congress to adjust the yield to current needs promptly
and at any time during the year.
Colle ctioq at source is the best method of keeping the taxpayer
out of debt to the Government. It taxes him while he is fully
nliquid” and still has the taxpaying ability upon which the income
tax is based# Under present collection methods, the tax may hit him
only after his income had been spent.
The Rural Plan
Another method which is urged for keeping the income taxpayer
out of debt to the Government is the Rural plan# It has been called
the skip-a-year plan and the pay-as-you-go plan. It does skip a
year. It does not 11pay as you go.” The Rural plan skips a year by
changing labels# The income tax you pay this year now bears the
label, Htax on 1941 income .” Mr# Ruml would change that label to
Mtentative tax on 1942 income.11 That is, he would forgive the 1941
tax entirely and treat the payments you make this year as current
payments on your 1942 income. But the story does not end hero.
When March, 1943> comes around, you will have to file a return show
ing your actual 1942 income# If that is higher or lower than your
1941 income— and it will rarely be the same— you will either pay an
additional tax or claim a refund. So far , the tax computations have
all been at existing rates and exemptions.
The next step is to compute a tentative tax for 1943* To do
this, you would apply to your 1942 income the higher rates and lower
exemptions in the new tax bill. That tentative tax yrould then be
adjusted in March, 1944> on the basis of actual 1943 income.
In effect, the Ruml plan requires two returns and two sets of
computations to determine one year's tax. This vail confuse the
taxpayer, and put added burdens on him Without producing any added
revenue. Moreover, it will complicate the administrative process,
since^ it will require refunds, additional collections, and cross
checking of returns. These complications would be tolerable if
the Ruml plan were fair, and if it accomplished the highly desirable
objective of bringing taxpayers current. The basic objections to
tne plan are that it is not fair and ths,t it does not accomplish its
objective.
The forgiveness of 194-1 tax liabilities grants a windfall gain
to anyone who had an unusually high income in'l941. A person with a
normal income of $5*000 who received $10,000 in 1941 would immediately
escape the tax on the added $5*000 and would eventually— when he
ceased to have any taxable income— escape the tax on the original
<¿>5*000. The ^Ruml plan confers the greatest benefit on those with
the biggest incomes* Between 80 and 90 percent of taxpayers have
incomes below $3*000. In their case, the amount of tax forgiven
would vary from a few dollars to a maximum of two or three hundred
dollars* But the wealthy man with an income of half a million
dollars would save a tax liability of more than $350,000.
vie were talking about morale a moment ago. Hhat would be the
effect on workers1 morale to see such a bounty going to the wealthy?
How would those whose incomes had remained stationary, or even fallen
m 1941, react to a tax plan which specially favored those whose in
comes had been abnormally high that yo&T? And, most important, how
would the morale of our fighting men be affected by a plan which
would cancel billions of dollars of tax liabilities in the midst of
a cruel and costly war?
Ironically, the Ruml plan even fails to accomplish its avowed
objective, namely, to put the taxpayer on a current ba.sis* This
fallure ,arises from the necessity of adjusting annually the tax
paid during the preceding year* to take account of year—to—year
income variations. If a man’s 1943 income is $3,000 while"his 1942
income was $10,000, ho will currently have to pay a $10,000-level tax
a *3,000 incomej or if it is the other way around, he vd.ll pay
a $3*000-lcvel tax out of a $10,000 income. Changing the label on
the tax nas not put the taxpayer on a pay—as—you—go basis. In fact,
the annual adjustment for the previous year ’s payments means that taxes
of persons with fluctuating incomes will be even further out of step
with income than they a.re at present. Treasury studies using actual
incomes of selected taxpayers over a 10-year period show that in every
case taxes would have fluctuated more— would have been further out
of step with income— under the Ruml plan than under the present payment
method.
The objective of putting tho income tax on a current basis is
an admirable one and deserves heatty support. The sound way to
accomplish this objective is to collect as much as possible at the
source, that is, to vfithhold at least the basic part of the tax
from wages, salaries, and dividends at the time they are paid. That
is a truly pay-as-you-go method.
Sales taxes and Spendings taxes
I should like to mention one other tax controversy. It relates
to the sales tax in comparison with the spendings tax. It cannot be
emphasized too often or too strongly that the sales tax— entirely
aside from its merits as a tax——is inadequate as an instrument of
inflation control. It is too crude an instrument. It does not come
within gunshot of dealing with the inflation problem facing us. ,*
The spendings tax is a very different instrument. It was
deliberately constructed to serve us in inflation control and was
recommended by the Treasury to serve that function* Progressive
rates and exemptions permit the spendings tax to be selective in its
impact, bringing pressure to bear where pressure is needed.
The^Treasury has been, and is, opposed to a sales tax, not only
because it is a poor instrument for inflation control, but, equally
important, because it fails to differentiate among parsons according
to their taxpaying abilities. The sales tax distributes the cost
of the^war in a most inequitable manner. An income tax without
exemptions levied at a rate of 10 percent óñ .a $500 income, 6 percent
on a §2,500 income, and 3 percent on a $10,000 income, would be
called absurd. Yet this is precisely the manner in which the burden
is distributed by a flat retail sales tax. People in the lowest
income^brackets are forced to spend all of their income on the basic
necessities of life, while those in the higher brackets have sub
stantial savings which a sales tax does not reach.
A tax on^spendings as proposed by the Treasury exempts a minimum
standard^of living. It imposes higher rates on persons who can re
duce their purchases substantially than on persons v/ho cannot. And
finally, it meets the inflation problem squarely. It removes
billions of dollars directly from the spendings stream. And by
providing a strong financial inducement to save, it would remove
additional billions from the spendings stream indirectly. It com
bines equity with a real body-blow at inflation.
- 9 -
Conclusion
The war will be financed in cne way or another. However, the
job can be done badly and it can be done well* We can, if we wish,
play ostrich, and refuse to enact the high taxes so urgently needed.
But we shall only be foiling ourselves if we think that we shall
thereby escape the burden of the war. There would be no surer way
of bringing on inflation, with its disruptive costs both during and
after the war. This will be doing the job badly. If through stiff
income and spendings taxes, we distribute war costs fairly and strike
boldly at inflation, we will be doing the job well•
33 ‘ V ^
'T V
/
The Treasury Department announced today it ^
working with
the War Department on new legislation to exempt from customs duties packages
having a value up to $50 which are mailed home by service men abroad.
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legislation
»The War Department^’
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7
which would permit free/entry on all servicemen's packages having a value
up to $50M, one official said.
,rWe are encouraging this proposal, and will
t'
give it our every support.
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TREASURY DEPARTMENT
Washington
POR IMMEDIATE RELEASE,
Friday, September 2 5 , 1942.
Press Service
No. 33-42
The Treasury Department announced today it has been
working with the War Department on new legislation to ex
empt from customs duties packages having a value up to
$50 which are mailed home by service men abroad.
nThe War Department has in hand a draft of legisla
tion on which the Treasury Department has been consulted
which would permit free entry on all servicemen’s pack
ages having a value up to $50,” one official said.
”We
are encouraging this proposal, and will give it our every
support.H
The official added that the present requirement that
duty be paid on any dutiable articles in such shipments
is not a matter of Treasury regulation but of law which
the Treasury Department lacks power to waive.
-oOo-
? -U 7
PAD 10 SCHEDULE T!EM0DAM)UM:_
Prof* Erwin Ji. Griswold of Harvard Lav; School,
who was a Treasury Department, w t consultant this summer,
will participate in the University of Chicago Pound Table
(
¿A.**1-£
|
discussion of
Jfamis£L
Taxation m m m Cost of Living Controls
at 2:30 p*ffl«, 517T, Sunday, October A, over the National
Broadcasting C0mpany network.
6 of the University of Chicago
will be Prof*
Æ lr
ano Prof.^ferS
#-The other participants
Du-Tg^o^'
University#/ pkcn,*Midi
Local Station:
¥ R
C
2:30 - Sunday
Division of Public Delations
/Radio Section)
TREASURY DEPARTMENT
Washington
RADIO SCHEDULE MEMORANDUM :
Professor Erwin N. Griswold of Harvard Daw School,
who was a Treasury Department consultant this summer,
will participate in the University of Chicago Round
Table discussion of "Taxation and Cost of Diving Con
trols", at 2:30 p.m,, EWT, Sunday, October 4> over the
National Broadcasting Company network.
The other par
ticipants will be Professor Henry Simons of the Univer
sity of Chicago and Professor Arthur Marget of the
University of Minnesota.
Docal Station?
W R C
2:30 - Sunday
Division of Public Relations
(Radio Section)
33-42a
In table 1, the number of returns, net income or deficit, and
tax are tabulated separately for individual returns with net income,
taxable fiduciary returns with net income, and individual returns with
no net income, by States and Territories.
In tables 2 and 3, there are
presented certain composite data for taxable individual and fiduciary
returns, with net income, by net income classes; also shown are data
for taxable individual returns with no net income in aggregate; nontaxable individual returns with net income by net income classes;
and nontaxable individual returns with no net income in aggregate*
For taxable fiduciary returns, the net income used for classification
and tabulation is the net income taxable to the fiduciary.
Tables
2A and 3A, relating to individual returns only, contain data for tax
able and nontaxable returns with net income by net income classes,
and aggregate data for returns with no net income.
Tables 2 and 2A show number of returns, net income, deficit,
personal exemption, credit for dependents, earned income credit, total
tax, normal tax, surtax, alternative tax, defense tax, and effective
tax rate.
Tables 3 and 3A show number of returns, sources of income,
deductions, net income, and deficit.
Income from the various sources
is the net amount, that is, the excess of gross receipts over the de
ductions as reported in the schedules on the returns, and the aggre
gate from each source is the sum of the net amounts of income from
that source.
Negative amounts reported under “Income" are transferred
in tabulation to deductions, and are included in the amounts tabulated
under specified or other deductions.
The net operating loss deduction
is not tabulated separately, but is included in other deductions.
De
ductions do not include credits such as personal exemption, credit for
dependents, or credit for earned income.
-
6
-
The "Normal tax and surtax" liability is reported on (1) returns
without net long-term capital gain or loss, and (2) returns with net
long-term capital gain or loss which are subject to normal tax and
surtax instead of the alternative tax*
The "Alternative tax" liability is reported on (1) returns with
net long-term capital gain if the alternative tax is less than the sum
of the normal tax and surtax computed on net income including net long
term capital gain, and (2) returns with long-term capital loss if the
alternative tax is greater than the sum of the normal tax and surtax
computed on net income after deducting net long-term capital loss*
The "Defense tax" liability is 10 percent of the total income
tax, but not in excess of 10 percent of the amount by which the net
income exceeds the tax computed without regard to the defense tax*
^ ^ T h e
"Total tax" liability is the aggregate of normal tax, surtax,
alternative tax, and defense tax*
The credits, for taxes paid at
source and taxes paid to foreign countries or any possession of the
United States, have not been deducted*
Data and classifications
Data from individual returns with net income of $5,000 and over,
from taxable fiduciary returns, Form 1041, and from individual returns
with no net income, Form 1040, are tabulated from each such return*
Data for individual returns with net income under $5,000, are in part
completely tabulated and in part estimated on the basis of samples*
Data for nontaxable individual returns (1) with net income and (2)
with no net income, which are required to be filed, are included in
the tabulations
of a married person living with husband or wife for the entire year,
and (b) from $5,000 to $800 in the case of a single person, a married
person not living with husband or wife, an estate, and a trust; the
personal exemption is reduced (a) from $2,500 to $2,000 for the head
of a family, and a married person living with husband or wife for the
entire year, and (b) from $1,000 to $800 for a single person, a married
person not living with husband or wife, and an estate; the surtax rates
are increased on surtax net income in excess of $6,000 and not in
excess of $100,000; and a defense tax is added, which is 10 percent
of the total income tax, but not in excess of 10 percent of the amount
by which the net income exoeeds the income tax.
S
'
The returns for 1940 are the first on which the net operating
loss deduction is reported.
Provision for this deduction was added
to the Code by the Revenue Act of 1939.
Definitions
"Total income" as tabulated is the sum of the positive amounts
of income reported.
"Total deductions" as tabulated is the sum of the deductions re
ported and the negative amounts reported under income.
"Net income" for individual returns means the excess of total
income over total deductions; for fiduciary returns, the excess of
total income over the sum of total deductions and amount distributable
to beneficiaries.
No net income" or "Deficit" for individual returns means the excess
of total deductions over total income.
Returns included
The data presented in this release are from returns for the
income year 1940 filed in the period January through December, 1941,
under the provisions of the Internal Revenue Code as amended.
In
cluded are individual returns, Forms 1040, 1040A, and 1040B; and
taxable fiduciary returns, Form 1041, filed for estates and trusts.
The returns are, in general, for the calendar year ending
December 31, 1940.
However, a negligible number of returns for a
fiscal year, other than the calendar year, ending within the period
July, 1940 through June, 1941, are tabulated with the calendar year
returns for 1940.
There are also included part year returns for
which the greater part of the accounting period falls in 1940.
Amended
returns and tentative returns are not included in the tabulations.
Statistics are taken from the returns as filed and prior to any
revisions that may be made as a result of audit by the Bureau of
Internal Revenue.
Changes in provisions of the Internal Revenue Code
The Revenue Act of 1940 amends certain provisions of the Internal
Revenue Code applicable to returns with taxable year beginning after
December 31, 1939.
However, these amendments do not apply to the
#
returns for a fiscal year or part year beginning in 1939.
Under the Internal Revenue Code, as amended by the Revenue Act
of 1940, the minimum amount of gross income for which a return is
required to be filed is reduced (a) from $5,000 to $2,000 in the case
F
Individual returns and taxable fiduciary returns*
Increase for 1940 over 1939, in number of returns,
net income, deficit, and taxes
(Money figures in thousands of dollars)
1940
Total individual and tax
able fiduciary returns*
Number of returns
Net income 1 /
Deficit
Tax
Taxable individual and
fiduciary returns*
With net income*
Number of returns
Net income 1f
Tax
Normal tax
Surtax
Alternative tax Z j
Defense tax Z /
Individual returns with
no net income 4^/*
Number of returns
Deficit
Alternative tax
Nontaxable individual
returns *
With net income 5/*
Number of returns
Net income
With no net income*
Number of returns 6/
Deficit
Increase
1940 ov%r 1939
Number or
Percent
amount
1939
14,778,159
36,588,546
311,385
1,496,403 é
7,715,660
23,191,871
284,327
928,694
7,062,499
13,396,675
27,058
567,709
91.5
57.8
9.5
61.1
7,504,649
23,558,030
1,495,930
388,950
435,331
543,299
128,350
3,959,297
15,803,945
928,394
286,345
313,518
328,532
3,545,352
7,754,085
567,537
102,606
121,813
214,768
89,5
49.1
61.1
35.8
38.9
65.4
-
-
.
46
2,551
473
17
1,128
300
29
1,423
173
170.6
126.1
57.6
7,160,813
13,030,516
3,673,902
7,387,926
3,486,911
5,642,590
94.9
76.4
30,207
25,635
36.6
9.1
112,651
308,834
82,444
283,199\ >
For footnotes, see page 19
s
I
«
Of the 7,273,464 nontaxable returns, 7,160,813 are for individuals
with net income of $13,030,515,511, —
nontaxable because exemptions
and credits exceed net income; and 112,651 are for individuals with no
net income, showing a deficit of $308,833,907, —
returns on which
total deductions exceed total income.
The normal tax and surtax liability, reported on 7,478,649 indi
vidual and fiduciary returns with net income, is $824,280,936; the
alternative tax, reported on 26,000 individual and fiduciary returns
with net income and on 46 individual returns with no net income due
to net long-term capital loss, is $543,772,173*
The defense tax, re
ported on individual and fiduciary returns with net income is $128,350,277,
The effective tax rate is 6*4 percent for taxable returns with net
income and 4,1 percent for all returns with net income.
The increase for 1940 over 1939, in number of returns, net in
come, deficit and taxes is presented on pagey3J * y
■TREASURY
DEPARTMENT
Washington
^Press Service
FOR RELEASE
Secretary of the Treasury Morgenthau today made public
’’Statistics of Income for 1940, Part 1,” prepared under the direction
of Commissioner of Internal Revenue Guy T. Helvering.
ThecdSta^nciude^figures for taxable and nontaxable individual
income and defense tax returns, with net income and with no net income,
and taxable fiduciary income and defense tax returns with net income,
for 1940 filed during the calendar year 1941.
Summary data
The total number of returns filed for 1940 is 14,778,159 an in
crease, as compared with the previous year, of 91.5 percent.
The
total net income is |36,588,545,894, and the total tax liability is
$1,496,403,386, an increase of 57.8 percent and 61.1 percent,
respectively.
There are 7,504,695 taxable returns, of which 7,437,261 are for
individuals with net income of $23,279,203,093 and tax of $1,440,967,144}
67,388 are for fiduciaries with net income of $278,827,290 and tax of
$54,963,289; and 46 are for individuals with no net income, showing a
deficit of $2,550,665, but with alternative tax of $472,953.
TREASURY DEPARTMENT'
Washington
FOR RELEASE, AFTERNOON NEWSPAPERS
P r e s s S e r v ic e
No. 3 3 -4 3
F r i d a y , O cto b er 2 , 1 9 4 2
S e c r e t a r y o f th e T re a s u ry M orgenthau to d a y made p u b lic f i g u r e s
f o r t a x a b l e and n o n ta x a b le i n d i v i d u a l income and d e fe n s e t a x r e t u r n s ,
w ith n e t incom e and w ith no n e t in com e, and ta x a b l e f i d u c i a r y income
and d e fe n s e t a x r e t u r n s w ith n e t in com e, f o r 1 9 4 0 f i l e d d u rin g th e
c a le n d a r y e a r 1 9 4 1 .
They a r e from " S t a t i s t i c s o f Income f o r 1 9 4 0 ,
P a r t 1 , " p re p a re d under th e d i r e c t i o n o f Com m issioner o f I n t e r n a l
Revenue Guy T . H e lv e r in g .
SUMMARY DATA
The t o t a l number o f r e t u r n s f i l e d f o r 1 9 4 0 i s 1 4 * 7 7 8 ,1 5 9 an i n
c r e a s e , a s compared w ith th e p re v io u s y e a r , o f 9 1 . 5 p e r c e n t . The
t o t a l n e t Income i s 4 3 6 , 5 8 8 ,5 4 5 .8 9 4 * and th e t o t a l t a x l i a b i l i t y i s
1 1 ,4 9 6 ,4 0 3 * 3 8 6 , an i n c r e a s e o f 5 7 *8 p e r c e n t and 6 1 .1 p e r c e n t , ’
re s p e c tiv e ly .
T here a r e 7 , 5 0 4 ,6 9 5 t a x a b l e r e t u r n s ,, o f w hich 7 * 4 3 7 * 2 6 1 a r e f o r
i n d i v i d u a ls w ith n e t income c f 4 2 3 * 2 ^ 9 * 2 0 3 * 0 9 3 and t a x o f 4 1 * 4 4 0 ,9 6 7 * 1 4 4 *
6 7 ,3 8 8 a r e f o r f i c u c i a r i e s w ith n e t income o f 4278 , 827*290 and t a x o f
15 4 * 963 , 289 ; and 46 a r e f o r in d i v i d u a l s w ith no n e t in com e, showing a
d e f i c i t o f ¡ § 2 ,5 5 0 ,6 6 5 , b u t Tilth a l t e r n a t i v e t a x o f 4 4 7 2 ,9 5 3 .
Of th e 7 ,2 7 3 * 4 6 4 n o n ta x a b le r e t u r n s , 7 * 1 6 0 ,8 1 3 a r e f o r in d i v i d u a ls
w ith n e t income o f 4 1 3 * 0 3 0 ,5 1 5 * 5 1 1 * ■**- n o n ta x a b le b ecau se exem p tion s
and c r e d i t s e x ce e d n e t in co m e; and 1 1 2 ,6 5 1 a r e f o r in d i v i d u a ls w ith no
n e t incom e* showing a d e f i c i t o f 4 3 0 8 ,8 3 3 ,9 0 7 * —* r e t u r n s on w hich
t o t a l d e d u c tio n s e xceed t o t a l in co m e.
The norm al t a x and s u r t a x l i a b i l i t y , r e p o r te d on 7 , 4 7 8 , 6 4 9 i n d i
v id u a l and f i d u c i a r y r e t u r n s w ith n e t in com e, i s 4 8 2 4 , 2 8 0 ,9 3 6 ; th e
a l t e r n a t i v e t a x , r e p o r te d on 2 6 ,0 0 0 in d i v i d u a l and f i d u c i a r y r e tu r n s
w ith n e t income and on 46 in d i v i d u a l r e t u r n s T ilth no n e t income due
t o n e t lo n g -te r m c a p i t a l l o s s , i s 4 5 4 3 , 7 7 2 ,1 7 3 . T he^defense t a x , r e
p o rte d on in d i v i d u a l and f i d u c i a r y r e t u r n s w ith n e t incom e i s 4 1 2 8 ,3 5 0 ,2 7 7 *
The e f f e c t i v e t a x r a t e i s 6 . 4 p e r c e n t f o r ta x a b l e r e t u r n s w ith n e t
incom e and 4 * 1 ' p e r c e n t f o r a l l r e t u r n s w ith n e t in com e.
The i n c r e a s e f o r 1 9 4 0 o v er 1 9 3 9 , in number o f r e t u r n s , n e t in com e,
d e f i c i t and t a x e s i s p re s e n te d on page 2 ,
« 2 -
'■<
És
O
3
(0
I n d iv id u a l r e t u r n s and t a x a b l e f i d u c i a r y r e t u r n s :
I n c r e a s e f o r 194-0 o v er 1 9 3 9 , in number o f r e t u r n s ,
n e t in co m e , d e f i c i t , and t a x e s
T o t a l i n d i v i d u a l and t a x
a b le f i d u c i a r y r e t u r n s :
Number o f r e t u r n s
Net incom e 1 /
D e fic it
T ax
T a x a b le i n d i v i d u a l and
fid u c ia ry re tu rn s :
W ith n e t in com e:
Number o f r e t u r n s
N et income l /
T ax
Normal t a x
S u r ta x
A lte rn a tiv e ta x 2 /
D efense t a x 3 /
I n d iv id u a l r e t u r n s -with
no n e t income 4 / :
Number o f r e t u r n s
D e fic it
A lte rn a tiv e ta x
N o n taxab le in d i v i d u a l
re tu rn s :
W ith n e t income 5 / i
Number o f r e t u r n s
Net income
W ith no n e t in com e:
Number o f r e t u r n s 6 /
D e fic it
F o r f o o t n o t e s , see page 17
n g u r e s i n unoiasan as 01 a a i .xars j
In cre a se
194 0 over 1939
Number o r
P ercen t
amount
1940
1939
1 4 , 7 7 8 ,1 5 9
3 6 , 5 8 8 ,5 4 6
3 1 1 ,3 8 5
1 , 4 9 6 ,4 0 3
7 ,7 1 5 ,6 6 0
2 3 , 1 9 1 ,8 7 1
2 8 4 ,3 2 7
9 2 8 ,6 9 4
7 , 5 0 4 ,6 4 9
2 3 , 5 5 8 ,0 3 0
1 , 4 9 5 ,9 3 0
3 8 8 ,9 5 0
4 3 5 ,3 3 1
5 4 3 ,2 9 9
3 , 9 5 9 ,2 9 7
1 5 , 8 0 3 ,9 4 5
9 2 8 ,3 9 4
2 8 6 ,3 4 5
3 1 3 ,5 1 8
3 2 8 ,5 3 2
128,350
«
7 ,0 6 2 ,4 9 9
1 3
,3 9 6
,6 7 5
2 7 ,0 5 8
5 6 7 ,7 0 9
9 1 .5
5 7 .8
9 .5
61.1
3 , 5 4 5 ,3 5 2
7 , 7 5 4 ,0 8 5
5 6 7 ,5 3 7
8 9 .5
4 9 .1
102,606
3 5 .8
3 8 .9
1 2 1 ,8 1 3
2 1 4 ,7 6 8
61.1
6 5 .4
-
-
29
1 ,4 2 3
173
170.6
126.1
2 ,5 5 1
17
1 ,1 2 8
4 73
30 0
7 , 1 6 0 ,8 1 3
1 3 , 0 3 0 ,5 1 6
7 ,3 8 7 ,9 2 6
3 , 4 8 6 ,9 1 1
5 , 6 4 2 ,5 9 0
9 4 .9
7 6 .4
1 1 2 ,6 5 1
3 0 8 ,8 3 4
3 2 ,4 4 4
2 8 3 ,1 9 9
3 0 ,2 0 7
2 5 ,6 3 5
36.6
46
3
,6
7 3 ,9 0 2
5 7 .6
9 .1
RETURNS INCLUDED
The data presented in this,release are from returns for the
income year 1940 filed in the period .-January through December, 1941,
under the provisions of the Internal Revenue Code as amended. In
cluded are individual returns, Forms 1040, 104QA, and 104QB; and
taxable fiduciary returns, Form 1041, filed for estates and trusts«
The returns are, in general, for the calendar year ending
December 31, 1940. However, a negligible number of returns for a
fiscal year, other than the calendar year, ending within the period
July, 1940 through June, 1941, are tabulated with the-calendar year
returns for 1940, There are also included part year returns for
which the greater part of the accounting period falls in 1940. Amended
returns and tentative returns are not included in the tabulations«
Statistics are taken from the returns as ^filed* and prior to any
revisions that may be made as a result of audit by the Bureau of
Internal Revenue.
CHANGES IN PROVISIONS OF THE INTERNAL REVENUE CODE
The Revenue Act of 1940 amends certain provisions of the Internal
Revenue Code applicable to returns with taxable year beginning after
December 31, 1939. However, these amendments do not apply to the
returns for a fiscal year or part year beginning in 1939.
Under the Internal Revenue Code, as amended by the Revenue Act
of 1940 the minimum amount of gross income for which a return is
required to be filed is reduced (a) from $<5,000 to $>2,000 in the case
of a married person living with husband or wife for the entire year,
and (b) from $>5,000 to $>800 in'the case of a single person, a married
person not living with husband or wife, an estate, and a trust; the
personal exemption is reduced (a) from $>2,500 to $>2,000 for the head
of a family, and a married person living with husband or wife for the
entire year, and (b) from $>1,000 to $>800 for a single person, a married
person not living with husband or wife, and an estate; the surtax rates
are increased on surtax net income in excess of $>6,000 and not in
excess of $<100,000; and a defense tax is added, which is 10 percent
of the total income tax, but not in excess of 10 percent of the amount
by which the net income exceeds the income tax.
- 4 -
The returns for 1940 are the first on which the net operating
loss deduction is reported.- Provision for this deduction was added
to the Code by the Revenue Act of 1939*
DEFINITIONS
«Total income" as tabulated is the sum of the positive amounts
of income reported.
"Total deductions" as tabulated is the sum of the deductions re
ported and the negative amounts reported under income.
"Net income" for individ.ua! returns means the excess of total
income over total deductions; for fiduciary returns, the excess of
total income over the sum of total deductions and amount distributable
to beneficiaries.
"No net income" or "Deficit" for individual returns means the excess
of total deductions over total income.
The "Normal tax and surtax" liability is reported on (1) returns
without net long-term capital gain or loss, and (2) returns with net
long-term capital gain or loss which are subject to normal tax and
surtax instead of the alternative tax.
The "Alternative tax" liability is reported on (1) returns with
net long-term capital gain if the alternative tax is less than the sum
of the normal tax and surtax computed on net income including net long
term capital gain, and (2) returns with long-term capital loss if the
alternative tax is greater than the sum of the normal tax and surtax
computed on net income after deducting net long-term capital loss.
The "Defense tax" liability is 10 percent of the total income
tax, but not in excess of 10 percent of the amount by which the net
income exceeds the tax computed without regard to the defense tax.
The "Total tax" liability is the aggregate of normal tax, surtax,
alternative tax, and defense tax. The credits, for taxes paid at
source and taxes paid to foreign countries or any possession of the
United States, have not been deducted.
- 5 -
DATA AND CUSS IFICATIONS
Data from individual returns with net Income of $5*000 and over,
from taxable fiduciary returns, Form 1041* and from individual returns
with no net income, Form 1040, are tabulated from each such return.
Data for individual returns with net income under $5*000, are in part
completely tabulated and in part estimated on the basis of samples.
Data for riontaxable individual returns (l) with net income and (2)
with no net income, which are required to be filed, are included in
the tabulations.
In table 1, the number of returns, net income or deficit, and
tax are tabulated separately for individual returns with net income,
taxable fiduciary returns with net income, and individual returns with '
no net income, by States and Territories. In tables 2 and 3* there are
presented certain composite data for taxable individual and fiduciary
returns, with net income, b/ net income classes; also shown are data
for taxable individual returns with no net income in aggregate; nontaxable individual returns with net Income by net income classes;
and nontaxable individual returns with no net income in aggregate.
For taxable fiduciary returns, the net income used for classification
and tabulation is the net income taxable to the .fiduciary. Tables
2A and 3A, relating to individual returns only, contain data for tax
able and'nontaxable returns with net income by net income classes,
and aggregate data for returns with no net income.
Tables 2 .and 2A show number of returns, net income, deficit,
personal exemption, credit for dependents, earned income credit, total
tax, normal tax, surtax, alternative tax, defense tax, and effective
tax rate. Tables 3 and 3A show number of returns, sources of income,
deductions, net income, and deficit. Income from the various sources
is the net amount, that is, the excess of.gross receipts over the de
ductions as reported in the schedules on the returns, and the aggre
gate from each source is the sum of the net amounts of income from
that source. Negative amounts reported under "Income" are transferred
in tabulation to deductions, and are included in the ^amounts tabulated
under specified or other deductions. The net operating loss^deduction
is not tabulated separately, but is included in other deductions. De
ductions do not include credits such as personal exemption, credit ior
dependents, or credit for earned income.
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4
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e
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w
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4
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5
6
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4
2dI
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s 5
2
)
F
o
rf
o
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t
n
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t
e
s
,s
e
ep
a
g
e1
9
6
-
6
3
1
12
1
2
8
6
1
1
4
1
8
8
9
1
1
,
5
7
9
4
4
0
1
2
,
0
1
9
1
2
,
4
8
4
9
,
6
4
4
2
9
1
,
1
6
1
1
4
,
1
9
6
,
3
7
3
8
,
0
9
0
5
0
,
8
1
7
6
1
,
9
4
2
4
.
5
2
6
3
3
4
4
.
8
6
0
4
.
6
4
2
2
.
3
7
3
7
.
3
5
6
2
3
0
.
8
2
2
2
5
.
4
6
0
1
2
7
.
5
0
2
1
6
6
.
0
7
2
2
2
8
.
0
1
4
1
6
.
1
0
5
7
7
5
1
6
.
8
7
9
1
7
.
1
2
7
1
2
.
0
1
8
2
9
8
.
5
1
7
1
4
.
4
2
7
.
1
9
5
3
3
.
5
5
0
1
7
8
.
3
1
8
1
2
6
,
9
1
1
5
.
3
7
5
1
3
2
.
2
8
6
2
7
6
.
0
2
2
4
3
.
8
2
3
7
6
2
.
4
3
3
4
1
.
1
0
1
.
1
5
4
5
4
.
5
1
3
2
5
9
.
7
4
4
5
é
l
.
7
2
8
5
8
6
,
1
8
1
1
7
5
.
5
4
7
1
2
2
,
5
7
2
5
,
0
3
6
1
2
7
,
4
0
8
2
7
1
,
3
8
0
4
1
,
4
5
0
7
5
4
,
5
1
1
4
0
,
8
6
1
,
5
7
0
2
9
,
0
5
0
1
3
2
,
1
6
5
4
.
5
4
0
3
3
9
4
.
8
7
9
4
.
6
4
2
2
.
3
7
5
7
.
9
2
3
2
3
9
.
5
8
3
2
5
.
4
6
3
1
2
7
.
5
7
9
Table 5. - Individuai returns and taxable fiduciary returns, 1940, by net income classes, by taxable and nontaxable returns, and in aggregate for individual
returns with no net incomes Number of returns, sources of income, deductions, net income, and deficit - Continued
(Net income classes and money figures in thousands of dollars)
Taxable and nontaxable returns
by net income 1/ classes
•
sale of property other
than capital
assets 24/
1
2
5
4
5
6
7
8
9
IO
11
12
IS
14
15
16
17
18
19
20
21
22
28
24
25
26
27
28
29
50
51
52
35
54
55
56
57
38
59
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
Individual returns and taxable fiduciary returns
with net income (41 plus 51)
Individual returns with no net income (42 plus 52)
For footnotes, see page 19
Interest paid
26/
(25)
(22)
(21)
Taxable Individual and fiduciary returns 1/
With net incomet
Under 1 (est.)
1 under 2 (est.)
2 under 2.5 (est.)
2.5 under 5 (est.)
5 under 4 (est.)
4 under 5 (est.)
5 under 6
6 under 7
7 under 8
8 under 9
9 under 10
10 under 11
11 under 12
12 under 15
15 under 14
14 under 15
15 under 20
20 under 25
25 under 30
SO under 40
40 under 50
50 under 60
60 under 70
70 under 80
80 under 90
90 under 100
100 under 150
150 under 200
200 under 250
250 under 300
300 under 400
400 under 500
500 under 750
750 under 1,000
1.000 under 1,500
1,500 under 2,000
2.000 under 3,000
5.000 under 4,000
4.000 under 5,000
5.000 and over
Total
Individual returns with no net income K/
Total, taxable returns
Nontaxable individual returns!
With net income S/ 1
Under 1 (est.)
1 under 2 (est.)
2 under 2.5 (est.)
2.5 under 3 (est.)
5 under 4 (est.)
4 under 5 (est.)
5 under 6
Total
Individual returns with no net income 6/
Total, nontaxable returns
Grand total (43 plus 55, or 55 plus 56)
Contributions
25/ (Individual returns)
Taxes paid 26/
(24)
(so)_______
84,955
28,952
9,387
7,224
11,431
8,216
6,221
5,058
4,041
3,687
2,526
3,073
1,879
2,171
1,786
2,071
10,326
4,393
5,267
5)712
4,091
2,941
2,386
1,799
1,701
1,531
4,159
2,401
1,292
672
434
1,384
592
85
2,048
2,783
236,653
495,297
4,114,602
2,092,287
2,511,444
5,487,700
1,755,885
1,199,763
841,519
630,495
502,685
429,239
559,094
313,176
270,457
240,890
219,025
829,986
553,014
390,325
523,106
345,657
235,360
170,543
125,212
103,249
78,131
235,754
113,932
64,923
47,741
60,496
41,260
55,040
29,184
54,757
15,475
14,079
13,445
12,735
5.075
23,558,030
10/ 2.551
11/ 23.555.480
2,447
5,647
1,398
691
362
59
2
8,606
8.956
6,417
7,498
5,502
1,338
895
116
5
19,570
45.498
65,407
90,126
49,398
20,297
7,157
594
50
231,008
64.947
272,588
396,957
303,915
136,760
52,484
2,870
286
1,165,858
539.656
—
1.289.071
39.521
138.045
682.552
4.587.340
236.653
11/ 36.277.l6l
617,333
65.219
4,056,372
550.968
‘ 236,855
“
36,588,546
10/ 511.585
27,505
50,781
51,701
24,489
9,183
486
23
164,167
5.092
40,766
82,225
76,905
57,490
14,781
544
70
252,780
30.457
71.205
739.992
750.972
720,073
30.899
(29)
71,866
118,573
103,679
44,073
16,144
617
46
354,801
32.595
5,264
4,986
2,258
1,095
431
43
1
14,077
33.077
754,645
5.547
(28)
tributable to
beneficiaries
(fiduciary
returns)
8
21,910
49
21.959
24,041
10
24.051
58,118
53.087
(27)
Total
deductions
28/
60,097
326,846
192,374
244,845
374,661
212,956
166,346
122,540
93,518
76,665
65,845
56,244
48,652
43,388
38,372
34,563
134,772
91,440
63,969
89,538
60,347
41,381
29,330
25,067
19,092
15,765
45,741
23,879
11,314
10,246
11,725
8,794
10,112
4,955
4,508
5,553
3,870
3,689
2,597
938
2,870,514
11.312
2.881.826
18,925
111,031
69,430
86,512 '
124,199
67,272
49,622
36,198
26,902
22,814
19,287
16,527
14,514
12,587
11,556
10,262
39,725
26,680
IB,959
27,050
17,453
12,136
8,471
6,415
5,778
4,108
12,720
6,169
5,046
2,674
2,775
1,857
2,659
1,212
1,699
629
800
566
191
66
901,032
642
901.675
.
(26)
Other
deductions
28/
13,804
45,525
28,739
35,471
55,738
31,293
23,599
16,888
15,405
9,540
8,018
6,957
5,781
5,151
4,285
3,915
14,920
9,926
6,535
9,417
6,475
4,375
3,392
2,942
2,002
1,572
5,057
2,573
1,297
1,591
1,457
1,506
988
317
596
369
165
852
270
65
386,325
272
386.597
6,130
35,374
32,244
48,048
77,883
42,054
35,266
24*874
17*615
14,520
12,104
9,748
8,210
6,802
6,207
5,419
20,004
12,508
8,213
10,355
7,235
4,388
2,880
2,729
1,811
1,262
5,229
2,366
1,600
637
969
724
428
252
431
94
193
87
362
41
467,292
442
467.735
5
(32)
Net income 1/
Bad debts
26/ (individual re—
turns, Form
1040)
498
2,575
2,379
5,100
6,699
5,514
4,558
5,544
2,978
2,428
2,247
2,236
1,858
1,557
1,498
1,206
4,863
5,685
2,682
3,227
2,005
2,336
1,145
869
641
519
1,765
3,527
426
177
764
315
227
79
138
276
32
259
76
5
72,887
87
72.975
13,813
109^865
44*262
52^472
72^127
36*802
25,923
18*429
13,621
lljl54
9^505
7¡969
6,989
6,057 ■
5,565
4,873
19,050
13,271
9,775
14,092
10,016
7,061
5,777
4,368
4,058
3,005
10,251
5,940
3,255
2,549
2,891
3,008
3,817
2,243
1,144
1,907
1,054
1,525
717
719
570,478
255
570.735
450
1,469
999
1,550
2*892
2*144
1*620
1*488
1*005
'834
771
647
587
552
459
287
1,590
*954
625
912
657
287
251
168
109
101
261
100
44
54
52
187
90
84
Losses from
fire, storm,
etc. 26/27/
(individual
returns,
Form 1040)
(25)
1,255,834
33.237
258
1,088
1,049
1,128
2,360
1,707
1,478
1,086
864
705
539
499
416
549
565
290
1,333
891
640
994
536
455
390
221
223
99
626
306
73
84
152
58
128
129
157
2
9
36
30,516
9.005
92,457
45.585
236.655
1,029,964
5,246,736
5,604,241
2,575,660
746,267
26,915
732
13,030,516
10/ 308.834
11/ 12.721.682
Table 3-A. - Individual returns, not including fiduciary returns, 1940, by net income classes, by taxable and nontaxable returns, and in aggregate for individual
returns with no net incomes Number of returns, sources of income, deductions, net income, and deficit
Taxable and nontaxable returns
by net income classes
Number of
returns
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
(1)
Taxable individual returnss
With net incomes
Under 1 (est.)
1 under 2 (est.)
2 under 2.5 (est.)
2.5 under 3 (est.)
3 under 4 (est.)
4 under 5 (est.)
5 under 6
6 under 7
7 under 8
8 under 9
9 under 10
10 under 11
11 under 12
12 under 13
13 under 14
14 under 15
15 under 20
20 under 25
25 under 30
30 under 40
40 under 50
50 under 60
60 under 70
70 under 80
80 under 90
90 under 100
100 under 150
150 under 200
200 under 250
250 under 300
300 under 400
400 under 500
500 under 750
750 tinder 1,000
1,000 under 1,500
1,500 under 2,000
2,000 under 3,000
3,000 under 4,000
4,000 under 5,000
5.000 and over
Total
With no net income 4/
Total, taxable returns
528,784
2,905,086
914,050
912,174
1,014,623
393,844
217,751
128,902
83,395
58,473
44,686
33,701
26,843
21,217
17,548
14,831
47,289
24,258
13,920
14,792
7,464
4,155
2,548
1,625
1,176
781
1,866
626
275
167
166
86
79
33
28
8
6
4
2
1
7,437,261
46
7.437.307
424,235
3,774,657
1,830,627
2,152,106
2,789,790
1,249,399
771,347
501,151
357,259
270,994
229,026
184,137
157,521
133,199
116,120
106,557
382,239
238,549
159,221
198,212
123,053
78,851
51,886
38,891
29,047
21,266
58,522
22,320
11,448
7,147
6,910
3,518
2,169
941
632
376
238
178
33
42
16,483,794
778
16.484.572
26,588
150,938
87,885
100,122
176,500
128,980
104,751
88,196
75,901
66,857
61,049
55,816
52,090
49,100
44,172
41,770
174,854
135,957
107,058
162,530
115,990
88,594
67,733
52,931
44,490
35,813
116,010
61,705
34,522
29,508
34,950
26,900
27,393
17,795
13,709
11,387
11,030
11,302
9,267
3.865
2,706,006
5.553
2.711.559
29/ 17.991
29/ 114,188
29/ 58.971
29/ 63,133
29/ 94.960
29/ 59.642
38,140
29,078
23,804
19,593
17,563
14,946
12,803
11,637
10,220
9,214
36,008
23,143
15,697
21,006
12,734
7,501
5,916
3,987
2,919
2,267
6,714
2,746
1,319
1,008
826
706
1,115
633
592
162
154
113
215
47
743,409
404
743.812
(30)
(30)
(30)
(30)
(30)
(30)
3,254
2,898
2,519
2,297
2,218
1,951
1,677
1,614
1,582
1,311
5,362
3,931
2,856
4,310
2,586
1,476
973
591
674
386
1,415
482
388
225
108
27
63
183
7
(32)
•
47,364
47
47,411
44
45
46
47
48
49
50
51
52
53
Nontaxable individual returnss
With net income 5/s
Under 1 (est.)
1 under 2 (est.)
2 under 2.5 (est.)
2.5 under 3 (est.)
3 under 4 (est.)
4 under 5 (est.)
5 under 6
Total
With no net income &/
Total, nontaxable returns
1,382,673
2,107,533
2,545,337
887,004
231,883
6,245
158
7,160,813
112,651
7.273,464
776,708
2,425,904
5,156,577
2,153,597
638,942
18,168
295
11,170,191
52.498
11.222.688
65,562
76,612
51,185
21,307
8,800
563
71
224,099
62.484
286.583
29/ 57.372
29/ 68.030
29/ 42,194
29/ 14.676
29/ 6.847
29/ 778
45
189,943
20.751
210.694
(30)
(30)
(30)
(30)
(30)
(30)
132
132
1.213
1.345
1
2
s
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
54
55
56
Grand total (43 plus 53, or 55 plus 56)
Individual returns with net income (41 plus 51)
TnrHvtdual returns with na net income (42 plus 52)
For footnotes, see page 19
(2)
(Net income classes and money figures in thousands of dollars)
v
v—
■
Sources of income
Partnership
Taxable interest
Dividends from
Salaries and
profit 15/
Partially taxBank deposits,
other compen
domestic and
exempt Govern
notes, mort
foreign corpo
sation
ment obligations
gages, corpo
rations 15/
14/
ration bonds
(7)
(6)
(4)
(5)
(3)
5,669
39,144
34,179
56,267
123,557
92,511
99,781
81,075
65,569
57,438
49,376
43,630
39,829
33,824
31,773
27,943
112,117
76,826
52,667
70,062
46,326
29,981
23,907
14,846
13,673
8,613
20,282
9,750
3,737
2,538
3,615
1,412
856
64
1,301
—
1,374,140
175
1.374.315
20,360
54,345
54,743
30,079
13,661
1,296
49
174,530
10,084
184.614 1
Income from
fiduciaries
Rents and
royalties
Business
profit 17/
O)
do)
w
(8)
12,965
66,276
51,159
64,044
99,233
60,740
48,937
35,501
27,414
21,748
17,793
16,407
13,377
11,261
10,060
8,501
32,022
20,939
13,359
20,230
12,267
6,788
5,000
3,862
2,818
1,703
5,287
2,064
965
426
1,131
111
356
931
52
63
(32)
21,164
118,112
142,795
231,988
437,499
279,728
225,737
165,596
121,259
94,535
78,327
62,462
51,314
43,037
37,729
32,809
116,579
68,888
42,216
50,453
27,632
17,969
10,799
7,331
5,510
3,054
10,365
2,769
946
962
2,127
3
20
1,938
(32)
1
2,127
14,772
10,219
12,431
27,930
26,190
30,847
26,349
22,757
21,361
19,537
17,115
16,431
14,363
13,878
12,818
54,883
41,425
53,961
49,204
35,861
24,948
18,600
14,723
13,099
10,364
33,203
19,064
11,320
8,525
11,683
8,071
15,544
4,747
13,816
3,438
4,859
5,493
4
15
725,975
1,151
727.126
695,789
41
695,830
”
< “
2,513,650
33
2.513.683
32
33
34
35
36
37
38
39
40
41
42
43
8,318
10,662
6,135
3,457
1,501
238
83
30,394
12,413
42.807
122,806
179,172
96,287
37,361
13,974
1,042
51
450,694
35,772
486.467
181,647
706,583
417,624
217,434
101,049
6,927
258
1,631,521
16.710
1.648,231
44
45
46
47
48
49
50
51
52
53
-
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
14.710.771
27.707.261
2.998.142
954.507
48,755
1.558.929
769.933
1.182,297
4,161,913._
54
14,598,074
112.697
27,653,985
53.276
2,930,105
68.037
933,352
21.155
47,496
1.260
1,548,670
10.259
756,369
13.564
1,146,484
35.813
4,145,171
16.742
55
56
Table 3-A,. - Individual returns, not including fiduciary returns, 1940, by net income classes, by taxable and nontaxable returns, and in aggregate for individual
returns with no net income: Humber of returns, sources of income, deductions, net income, and deficit - Continued
Taxable and nontaxable returns
by net income classes
1
2
3
4
5
6
7
8
9
10
n
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
58
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
______________________(1)
Taxable individual returns:
With net income:
Under 1 (est.)
1 under 2 (est.)
2 under 2.5 (est.)
2.5 under 3 (est.)
3 under 4 (est.)
4 under 5 (est.)
5 under 6
6 under 7
7 under 8
8 under 9
9 under 10
10 under 11
11 under 12
12 under 15
13 under 14
14 under 15
15 under 20
20 under 25
25 under 30
30 under 40
40 under 50
50 under 60
60 under 70
70 under 80
80 under 90
90 under 100
100 under 150
150 under 200
200 under 250
250 under 300
500 under 400
400 under 500
500 under 750
750 under 1,000
1,000 under 1,500
1,500 under 2,000
2,000 under 3,000
3,000 under 4,000
4,000 under 5,000
5,000 and over
Total
With no net income 4/
Total, taxable returns
Nontaxable individual returns:
With net income 5/:
Under 1 (est.)
1 under 2 (est.)
2 under 2.5 (est.)
2.5 under 3 (est.)
3 under 4 (est.)
4 under 5 (est.)
5 under 6
Total
With no net income 6/
Total, nontaxable returns
Grand total (43 plus 53, or 55 plus 56)
Individual returns with net income (41 plus 51)
Individual returns with no net income (42 plus 52)
For footnotes, see page 19
(Net Income classes and money figures In thousands of dollars)
Sources of income - Continued
Capital gain 18/
Net gain from
Other income
Net long-term
sale of prop
Short-term 19/
capital gain
erty other
Net short-term Net short-term Current year
than capital
capital loss
capital gain
23/
net short
term capital
of preceding
assets 24/
included in
gain 22/ (col,
taxable year
total income
20/(col. 15-12; 21/
11 + 12)
(16)
(15)
(13)
(11)
(14)
(12)
584
3,341
2,735
3,331
7,791
6,752
6,534
5,046
4,361
3,645
3,454
5,075
2,759
2,191
2,241
1,975
8,029
5,213
3,756
4,544
2,620
2,066
1,155
880
633
492
1,770
787
596
187
860
31
10
141
24
8
16
121
111
157
290
199
265
203
165
144
96
127
116
81
119
93
416
336
218
408
174
129
141
30
14
33
73
76
9
13
26
(32)
15
4
6
-
-
-
-
600
3,462
2,846
3,488
8,081
6,950
6,800
5,249
4,527
3,789
3,550
3,201
2,874
2,272
2,360
2,068
8,445
5,549
3,974
4,952
2,794
2,195
1,294
910
647
525
1,843
863
605
200
886
31
26
145
29
8
«
-
-
-
93,614
14
93.628
4,424
5
4.429
98,038
19
98.057
2,638
3,392
2,723
1,802
944
73
6
11,579
4,526
16.105
109.732
105,193
4.540
108
196
75
23
39
•
440
354
775
5.204
4,864
339
2,747
5,588
2,797
1,825
984
73
6
12,019
4,860
16,879
114.936
110,057
4.879
604
3,297
3,450
4,594
8,604
7,459
7,874
6,495
5,651
5,140
4,725
4,169
3,797
3,530
3,255
2,840
12,291
8,508
7,385
9,201
7,969
6,395
5,451
3,740
4,227
2,696
12,413
7,843
5,463
4,369
5,288
5,867
8,770
4,810
7,792
1,591
1,494
44
2.043
211,135
211.135
2,910
4,700
2,726
1,519
555
70
3
12,484
4.642
17.127
228.262
223,619
_________ 1,642 .
Deductions
Total income
(17)
•
30,031
(52)
30,051
17,530
126,262
50,045
56,361
75,451
37,792
13,171
9,263
6,794
5,688
4,097
3,769
3,535
3,096
2,657
2,466
8,290
5,234
3,453
5,297
3,450
2,396
1,658
1,240
812
477
1,984
781
589
829
805
387
250
157
19
41
174
45
18
456,365
567
456.932
529,667
4,412,775
2,273,472
2,746,765
3,815,597
1,952,740
1,352,986
952,680
714,703
570,476
488,223
408,245
355,881
307,444
274,220
248,689
944,307
629,771
442,147
595,582
390,715
267,183
193,137
143,064
118,075
87,212
268,013
130,336
71,537
55,726
68,305
47,032
56,546
32,340
37,945
17,066
17,949
17,132
9,580
6,012
26,081,272
8.761
26.090,033
1,685
3,936
2,067
1,067
801
87
1
9,644
2.373
12.018
42,048
39,675
2.373
62,547
110,357
75,895
30,120
11,676
542
24
291,161
7.356
298.517
755.449
747,526
7.923
1,302,552
3,645,693
5,908,154
2,512,419
798,751
29,785
1.018
14,196,373
230.822
14,427,195
40.517.228
40,277,645
239.583
210
1,787
1,407
2,387
4,282
3,547
2,611
2,034
1,415
1,180
1,057
768
747
593
534
484
1,633
1,159
518
531
224
239
61
43
173
80
48
25
245
1
4
-
1
(32)
(32)
-
Partnership
loss 15/
(18)
Business
loss 17/
(19)
Net long-term
capital loss
18/23/
(20)
20,711
3
20.713
974
4,067
3,097
4,262
7,716
5,200
4,379
3,516
2,906
2,162
1,945
1,667
1,666
1,640
1,294
1,190
5,214
3,506
2,453
3,758
2,796
1,769
1,242
985
1,211
811
2,976
1,028
513
298
585
358
994
248
486
89
1,579
23
35
80,637
77
80.715
4,244
14,295
9,128
11,417
22,766
19,242
18,129
15,007
13,204
11,576
10,461
9,511
8,026
8,187
6,901
6,689
26,434
18,674
13,212
18,424
12,438
7,908
5,577
4,060
2,974
2,293
6,215
3,594
972
1,314
1,931
731
776
386
76
184
55
562
317,373
9.475
326.848
3,700
2,691
1,036
407
243
12
1
8,090
25,460
33.550
54.264
28,801
25.463
23,886
16,929
6,083
2,648
967
286
18
50,817
127.502
178.318
259.033
131,454
127.579
27,331
19,701
8,154
4,231
2,323
114
89
61,942
166.072
228.014
554.861
379,314
175.547
244
861
795
862
1,849
1,457
1,438
1,147
789
632
773
534
493
470
394
312
1,183
1,033
600
926
531
554
332
250
238
178
460
221
88
887
124
62
6
5
1
3
-
1
2
3
4
5
6
7
8
9
10
11
12
13
14
IS
16
17
18
19
20
21
22
23
24
25
26
27
26
29
30
31
32
35
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
Table 3-A.
Individual returns, not including fiduciary returns, 1940, by net income classes, by taxable and nontaxable returns, and in aggregate for individual
returns with no net income: Number of returns, sources of income, deductions, net income, and deficit - Continued
Taxable and nontaxable returns
by net Income classes
ill
1
2
3
4
5
6
7
.8
9
10
11
12
13
14
IS
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
taxable individual returns:
With net income:
Under 1 (est.)
1 under 2 (est.)
2 under 2.5 (est.)
2.5 under 3 (est.)
3 under 4 (est.)
4 under 5 (est.)
5 under 6
6 under 7
7 under 8
8 under 9
9 under 10
10 under 11
11 under 12
12 under 13
13 under 14
14 under 15
15 under 20
20 under 25
25 under 30
30 under 40
40 under 50
50 under 60
60 under 70
70 under 80
80 under 90
90 under 100
100 under 150
150 under 200
200 under 250
250 under 300
300 under 400
400 under 500
500 under 750
750 under 1,000
1.000 under 1,500
1,500 under 2,000
2.000 under 3,000
3.000 under 4,000
4.000 under 5,000
5.000 and over
Total
With no net income 4 /
Total, taxable returns
Nontaxable individual returns:
With net income 5/:
Under 1 (est.)
1 under 2 (est.)
2 under 2.5 (est.)
2.5 under 3 (est.)
3 under 4 (est.)
4 under 5 (est.)
5 under 6
Total
With no net income 6/
Total, nontaxable returns
Grand total (43 plus 53, or 55 plus 56)
Individual returns with net income (41 plus 51)
Individual returns vrith no net income (42 plus 52)
For footnotes, see page 19
(Net income classes and money firures in thousands of dollars)
Deductions- Continued
Losses from
Taxes paid
Interest
Contributions
fire, storm,
26/
paid 26/
25/
etc. 26/ 27/
(Form 1040)
Net loss from
sale of prop
erty other
than capital
assets 24/
(25)_
iSiL
(2l) __
5,091
34,206
31,909
47,778
77,380
41,516
34,893
24,459
17,394
14,262
11,921
9,624
8 ,1 0 2
6,691
6,129
5,334
19,309
12,204
7,947
10,130
6,914
4,224
2,758
2,523
1,718
1,155
4,854
2,213
1,252
634
959
592
378
244
423
93
193
87
362
41
457,907
442
14,911
108,048
68,462
85,724
122,994
66,313
48,816
35,537
26,436
22,360
18,971
15.982
14,221
12,336
11,130
10,078
38,850
26,212
18,530
26,451
16.982
11,749
8,285
6,304
5,653
3,910
12,118
5,893
2,978
2,589
2,632
1,748
2,524
1,155
1,699
614
800
566
183
258
1,088
1,049
1,128
2,360
1,707
1,478
1,086
864
705
539
499
416
349
565
290
1,333
891
640
994
536
453
390
221
223
99
626
306
73
84
152
58
128
129
137
2
9
36
66
8
21,910
49
14.077
33.077
27,505
50,731
51,701
24,489
9,183
486
23
164,167
5,092
40,766
82,225
76,905
37,490
14,781
544
70
252,780
30,457
283,237
741,586
71,866
118,373
103,679
44,075
16,144
617
46
354,801
32,595
387,396
8,606
8,956
17,562
1.268,848
39,521
37,713
33,087
734,645
5,347
710,687
30,899
1,235,611
33,237
30,516
9,005
3
(32)
23,636
10
5,264
4,986
2,258
1,095
431
43
1
880,810
642
w
2,447
3,647
1,398
691
362
59
2
Other
deductions 51/
(2?)
(2 6 )
13,813
109,865
44,262
52,472
72,127
36,802
25,923
18,429
13,621
11,154
9,505
7,969
6,989
6,037
5,365
4,873
19,050
13,271
9,773
14,092
10,016
7,061
5,777
4,368
4,058
3,003
10,251
5,940
3,255
2,549
2,891
3,008
3,817
2,243
1,144
1,907
1,034
1,325
717
719
570,478
255
384
1,403
982
1,335
2,868
2,115
1,598
1,463
999
828
766
G43
583
548
452
282
1,569
949
612
898
639
283
230
145
109
98
260
100
44
34
52
187
90
84
Bad debts
(Form 1040
498
2,573
2,379
3,100
6,699
5,514
4,558
3,544
2,978
2,428
2,247
2,236
1,858
1,537
1,498
1,206
4,863
5,685
2,682
3,227
2,003
2,336
1,145
869
641
519
1,765
1,527
426
177
764
315
227
79
138
276
32
259
76
5
6,650
41,572
27,552
34,484
54,052
30,097
22,477
15,924
12,671
8,942
7,580
6,406
5,255
4,830
3,944
3,641
13,267
9,261
5.960
8,462
5.961
3,938
2,889
2,011
1,843
1,181
4,499
2,212
1,098
1,534
1,351
1,082
911
293
596
286
165
852
127
63
355,720
272
Total
deductions 31/
(2 8 )
47,068
317,978
189,615
242,561
370,810
209,944
163,689
120,113
91,862
75,047
64,710
55,071
47,608
42,626
37,672
33,895
131,072
89,686
62,410
87,361
58,818
40,275
28,425
21,735
18,668
13,256
44,025
23,035
10,699
10,101
11,442
8,138
9,850
4,866
4,500
3,453
3,870
3,689
1,489
938
2,802,069
11,312
(29).
482,599
4,094,-796
2,083,858
2,504,204
3,474,787
1,742,796
1,189,297
832,567
622,841
495,429
423,513
353,174
308,273
264,818
236,548
214,794
813,235
540,085
379,737
508,221
331,895
226,908
164,712
121,329
99,408
73,956
223,988
107,300
60,839
45,625
56,863
38,893
46,696
27,474
33,445
13,614
14,079
13,443
8,090
5.075
23,279,203
10/ 2,551
11/ 23,276,652
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
272,588
396,957
303,915
136,760
52,484
2,870
286
1,165,858
539,656
1,705,514
1,029,964
3,246,736
5,604,241
2,575,660
746,267
26,915
732
13,030,516
10/308,854
11/ 12.721.6§2~
138,043
63,407
90,126
49,398
20,297
7,157
594
30
231,008
64,947
295,955
651.947
4,518,894
11/ 35.998,354
54
92,457
45.585
586,728
65,219
3,967,926
550,968
36,309,719
10/ 511.385
55
56
6,417
7,498
3,302
1,338
895
116
5
19,570
45,498
45
46
47
48
49
50
51
52
53
- 17 Footnotes fo r ta b le s 1 . 2. 2A. 5 . and 3A
1/
For taxable fid u ciary retu rns, the net income used fo r
c la s s ific a tio n and tabu lation i s the net income taxa
ble to the fid u ciary a ft e r d istrib u tio n to b e n e fic ia rie s
(item 1 7, page 1 , Form 1041).
2/
The a lte rn a tiv e tax i s imposed on (1) returns with net
long-term c a p ita l gain i f such a lte rn a tiv e tax i s
le s s than the sum o f the normal ta x and surtax com
puted on net income including n et long-term ca p ita l
gain, and (2) returns with net long-term c a p ita l lo ss
i f such a lte rn a tiv e ta x i s greater than the sum of
the normal tax and surtax computed on net income a ft e r
deducting net long-term ca p ita l l o s s .
5/
Defense tax i s ten percent o f the to t a l income ta x ,
but not in excess o f ten percent o f the amount by
which the net income exceeds the income tax.
4/
Returns, with no net income due
t a l lo s s , on which the p a rtia l
income before the deduction of
lo ss exceeds 50 percent o f the
lo s s .
Include individual returns with zero net income (to ta l
deductions equal to t a l income).
7/ Aggregate o f normal ta x , surtax, a lte rn a tiv e ta x , and
defense tax l i a b i l i t i e s . For returns with normal
ta x and surtax, see note 9 . For returns with a lte r
native ta x , see note 2 .
8/
2/
10/
For 1940, the personal exemption allowed a sin gle per
son, a married person not liv in g with husband or w ife,
and an e s ta te , was reduced from $1,000 to $800, and
th a t fo r the head o f a fam ily and a married person
liv in g with husband or wife lo r the e n tire taxable
year, was reduced from $2,500 to $ 2 ,0 0 0 . Sim ilar to
1939, a tr u s t i s allowed, in lie u o f the personal
exemption, a c re d it o f $100 against net income.
Returns with normal tax and surtax are (1) returns
without net long-term ca p ita l gain o r lo ss and (2)
returns with net long-term c a p ita l gain or lo s s ,
which are su b ject to normal tax and surtax instead
o f a lte rn a tiv e ta x . (See note 2 ) .
Net income le s s d e f i c it .
12/
Not a v a ila b le .
15/
Exclude dividends received through partnerships and
fid u c ia rie s and dividends received on share accounts
in Federal savings and loan a sso cia tio n s.
lfi/
16/
Current year business p r o fit or l o s s . Net opera
tin g lo s s deduction i s reported in "Other deduc
tio n s ."
12/
The term "C apital a sse ts" means property held by
the taxpayer (whether or not connected with h is
trade or b u sin ess), excluding (1) stock in trade
or other property which would properly be in
cluded in inventory i f on hand a t the close o f the
taxable year, (2) property held prim arily fo r sale
* to customers in the ordinary course o f trade or
business, and (3) property used in trade or busi
ness o f a character which i s su b ject to the allow
ance fo r d epreciation. The tabulated amounts of
"Net short-term ca p ita l g a in ," "Net long-term
c a p ita l gain” and "Net long-term ca p ita l lo s s "
include each p a rtic ip a n t's share o f net c a p ita l
gain o r 'lo s s to be taken in to account from p art
nerships and "Common tr u s t funds."
19/
Taxable in te r e s t on p a r tia lly tax-exempt Government
o bligation s received from United S ta te s savings bonds
and Treasury bonds owned in excess o f $ 5,000, and
ob ligation s o f in stru m en talities o f the United S ta te s
other than those issued under the Federal Farm Loan
Act o r such a c t as amended.
Partnership p r o fit or lo s s , as reported on the income
ta x return o f the p artner, excludes (1) taxable in t e r
e s t on p a r tia lly tax-exempt Government o b lig atio n s,
(2) net gain or lo ss from sa les or exchanges o f capi
t a l a s s e ts , eacn o f which i s reported in i t s respec
tiv e source of income, and (3) dividends on share
accounts in Federal savings and loan asso ciatio n s
which are reported in "Other income". Charitable con
trib u tio n s and net operating lo s s deduction, not being
deductible in computing partnership p r o f it or lo s s , are
reported on the p a rtn er's income tax return in "Contri
butions" and "Other deductions" re sp ectiv ely .
Income from fid u c ia r ie s , as reported on the return of
the b en eficia ry , excludes (1). taxable in te r e s t on
p a r tia lly tax-exempt Government ob ligation s and (2)
net gain o r lo s s from sa les or exchanges o f ca p ita l
a sse ts received from common tr u st funds, each o f
which i s reported in i t s respective source o f income,
and (3 ) dividends on share accounts in Federal savings
and loan a sso ciatio n s which are reported in "Other
income". The net operating lo ss deduction, not being
"Short-term " applies to ca p ita l assets held 18
months or l e s s .
£2/ Net short-term c a p ita l gain reported fo r the com
putation of net income. (For ind ivid u als, item
1 0 (a ), page 1 , Form 1040: fo r fid u c ia r ie s , item
7 (a ) , page 1 , Form 1041.)
21/
Net short-term c a p ita l lo s s o f preceding year i s
the amount deducted under the n et sh o rt-tern lo ss
carry-over provision o f the In tern al Revenue Code.
The amount carried over cannot exceed the net in
come fo r the year in which the lo s s i s sustained,
and can be deducted only to the exten t o f the net
short-term ca p ita l gain o f the current year.
22/
Current year net short-term c a p ita l gain before
deducting net sh o rt-tern c a p ita l lo s s o f preceding
taxable year. This amount would have been reported
fo r computation o f net income i f the net short
term ca p ita l lo ss o f preceding taxable year had not
been deductible.
25/
"Long-term" applies to c a p ita l a sse ts held over 18
months. Losses, from worthless stocks and bonds
which are c a p ita l a s s e ts , are deducted in computing
"Net long-term c a p ita l gain" and "Net long-term
c a p ita l l o s s ."
D e fic it.
11/
14/
12/
to net long-term capi
ta x computed on net
net long-term c a p ita l
net long-term ca p ita l
5/ Exemptions and c re d its exceed net income. A n eg lig ib le
number of nontaxable individual returns in net income
c la sses o f $6,000 and over are not tabulated separate
ly .
6/
deductible in computing income from common tr u s t
funds, i s reported on the b e n e fic ia ry 's return in
"Other deductions," however, the net operating lo s s
deduction i s deducted from a l l oth er fid u ciary in
come reported on the b e n e fic ia ry 's return.
24/ Net gain or lo s s from sales o f property used in
trade o r business of a character which i s su b ject
to the allowance fo r depreciation.
25/
Include each p a rtn e r's share o f ch aritab le co n tri
butions o f partnerships (see note 1 5 ).
26/ Excludes amount reported in schedule for (1) income
from ren ts and ro y a ltie s , and (2) p r o fit or lo ss
from business.
22/
Losses from f i r e , storm, shipwreck, or oth er casualty ,
or from t h e f t, not compensated fo r by insurance or
otherwise.
2§/
Include net operating lo ss deduction reported on Forms
1040 and 1041, and lo sses from f i r e , storm, e t c . , and
bad debts, reported on Forms 1040A and 1041.
29/
For n et income c la sse s under $5,000, taxable in te r e s t
from bank deposits, mortgages and corporation bonds
includes taxable in te r e s t on p a r tia lly tax-exempt
Government ob lig atio n s.
30/ For n et income c la sse s under $5,000, taxable in te r e s t
on p a r tia lly tax-exempt Government o b ligation s i s
tabulated with taxable in te r e s t from bank deposits,
mortgages and corporation bonds.
$1/
Include n et operating lo ss deduction reported on
Form 1040, and lo sses from f i r e , storm, e t c . , and
bad debts, reported on Form 104GA.
32/ Less than $500.
iksAsusar w t t M
Washington
FOR IS&EDIATE S U P S
Press Service
... ZH:£.
\ ,
Ko*
/ 1
3 3 ^ ^ ^
.y
The treasury Department announced today the conviction and sentenc
ing late Friday of Kenji Iki in the United States District Court at Seattle,
Washington* for violating the provisions of the President1«
Freezing Control
Order*
le&Ji Iki, the manager of a Japanese concern, United Ocean transport
guilty to charges of concealing $15,000 in United States
currency and $515,000 face value of Japanese bonds belonging to his company
and falling to report these holding« to the Treasury Department as required
by the regulations issued under the Freezing Control Order. He mis sentenced
to nine years imprisonment and a 15,000 fine. Kenji Iki also pleaded guilty
to charges of perjury and conspiracy, for which he was sentenced to five
years and two years imprisonment, these sentences, however, to run concurrently
with the nine year sentence. The investigation leading up to the indictment
and conviction of Kenji Iki was conducted b y the Bureau of Customs, assisted
by the Foreign Funds Control.
Company, pleaded
*
This is the second conviction In recent weeks for violations of
the Presidents Order "freezing*» the assets of enemy, enemy-occupied, and
certain other countries. On August
Werner von Clemra was sentenced in
the Federal Court at Hew fork to two years imprisonment and he and his
corporation, the Pioneer Import Company, were each fined H O , 000 for con
spiring to violate the Freezing Control Order by importing into the United
States and here disposing of diamonds looted by the German authorities in
Holland and Belgium.
2k,
Treasury spokesmen indicated that Treasury Shforcement Agents are
actively investigating a number of other cases and that further prosecutions
may be anticipated.
(Initialed) R.B.P.
oGo
LEAckermann:BB/ma -
9/2Q/k2
?
TREASURY DEPARTMENT
Washington
FOR.IMMEDIATE RELEASE
ÛL<a
w
j
Press Service
No.
___ ^
T
;V, f W i ( o
'I”
.
n
b ;
e ~.. • r ç K e w e ü ... < u jn >
A fi
tT
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53
The ^roacmry Bepantmont aiwewi^eeK'tsgfay¿'the conviction and sentencing l a t e^ r i d a y of Kenji Dei in the United States District Court at Seattle,
Washington, for violating the provisions of the P residents
Freezing Control
Order.
Kenji Dei, the manager of a Japanese concern, United Ocean Transport
Company, pleaded guilty to charges of concealing $15,000 in United States
currency and $515,000 face value of Japanese bonds belonging to his company
and failing to report these holdings to the Treasury Department as required
by the regulations issued under the Freezing Control Order. He was sentenced
to nine years imprisonment and a $5,000 fine* Kenji Iki also pleaded guilty
to charges of perjury and conspiracy, for which he was sentenced to five
years and two years imprisonment, these sentences, however, to run concurrently
with the nine year sentence. The investigation leading up to the indictment
and conviction of Kenji Dei was conducted by the Bureau of Customs, assisted
by the Foreign Funds Control.
This is the second conviction in recent weeks for violations of
the Presidents Order ,ffreezing* the assets of enemy, enemy-occupied, and
certain other countries. On August
Werner von Clemin was sentenced in
the Federal Court at New York to two years Imprisonment and he and his
corporation, the Pioneer Import Company, were each fined $10,000 for con
spiring to violate the Freezing Control Order by importing into the United
States and here disposing of diamonds looted by the German authorities in
Holland and Belgium.
2h,
«Treasury apelwjisiiWM indicated thyi Treasury Enforcement Agents are
actively investigating a number of other cases and
further prosecutions
may be anticipated.
TREASURY DEPARTMENT
Washington
F O R I M M E D I A T E RELEASE,
Monday, S e p t e m b e r 23, 1942,
P r e s s Service
No. 33-44
T h e F o r e i g n Funds Control D i v i s i o n r e c e i v e d w o r d today of
the c o n v i c t i o n a nd sentencing late last F r i d a y of K e n j i Iki in
the U n i t e d States D i s trict C o urt at Seattle,
v i o l a t i n g the p r o v i s i o n s of the P r e s i d e n t s
Washington,
for
F r e e z i n g Control
Order.
K e n j l Iki, the m a n a g e r of a J a p a n e s e concern, U n i t e d O c e a n
T r a n s p o r t Company, p l e a d e d g u i l t y to charges of c o n c e a l i n g $ 1 5 , 0 0 0
in U n i t e d States c u r r e n c y and $ 5 ^ 5 # 0 0 0 face value of J a p a n e s e
b o n d s b e l o n g i n g to his c o mpany and f a i l i n g to report these h o l d
ings to the T r e a s u r y D e p a r t m e n t as r e q u i r e d b y the r e g u l a t i o n s
issued u n d e r the F r e e z i n g C o n t r o l Order,
Ke was s e n t e n c e d to
nine years' i mpr i s o n m e n t a n d a $ 5 , 0 0 0 fine.
K e njl Iki also p l e a d e d
g u i l t y to charges of p e r j u r y and conspiracy, f or w h i c h he was
s e n t e n c e d to five years' and two years* imprisonment, these s e n
tences, however, to run c o n c u r r e n t l y w i t h the nine y e a r sentence.
T h e I n v e s t i g a t i o n l e a d i n g up to the i n d i ctment and c o n v i c t i o n of
K e n j i I ki was c o n d u c t e d b y the B u r e a u of Customs, a s s i s t e d b y the
F o r e i g n Funds Control.
T h i s is the second c o n v i c t i o n in recent w e eks f o r v i o l a t i o n s
of the P r e s i d e n t * s O r d e r " f r e e z i n g ” the assets of enemy, enemyoocupied, and ce r t a i n o t h e r countries,
O n A u g u s t 24-, W e r n e r von
C l e m m was s e n t e n c e d in the F e d e r a l Court at N e w Y o r k to two years'
i m p r i s o n m e n t an d he and his corporation, the P i o n e e r I m p o r t C o m
pany, were eac h f i n e d $ 1 0 , 0 0 0 fo r c o n s p i r i n g to v i o l a t e the
F r e e z i n g C o n t r o l O r d e r b y i m p o r t i n g into the U n i t e d States and
her e d i s p o s i n g of d i a monds l o o t e d b y the G-erman a u t h o r i t i e s in
H o l l a n d and Belgium.
T r e a s u r y E n f o r c e m e n t A g e n t s are a c t i v e l y i n v e s t i g a t i n g a
n u m b e r of o t h e r cases a n d o f f i c i a l s said f u r t h e r p r o s e c u t i o n s may
be anticipated.
7 ^ -
-"pvt-
TRMSHHT DSPa H T M ^ T
Washington
FOR RELEASE, MORNING NEWSPAPERS
Tuesday. September 29. 1942.
9/28/42
Press Service
33
V5
The Secretary of the Treasury announced last evening that the tenders for
$400,000,000, or thereabouts, of 91-day Treasury bills to be dated September 30 and
to mature December 30, 1942, which were offered on September 2$, were opened at the
Federal Reserve Banks on September 28.
The details of this issue are as follows:
Total applied for - $725,763,000
Total accepted
• 401,288,000
Range of accepted bids:
Kigh
Low
Average price
- 99.925 Equivalent rate of discount approx. 0,2973f per annus
- 99.905
*
»
«
«
«*
0.376^ «
»
- 99.906
"
»
«
»
«
0*37356 n
«
(48 percent of the amount bid for at the low price was accepted)
b
o
0
0
hi
i
i
’TREASURY DEPARTMENT
Washington
FOR RELEASE, MORNING NEWSPAPERS,
Tuesday, September 29, 1942*
9/ 28/42
Press Service
No, 33-45
The Secretary of the Treasury announced last evening
\
that the tenders for $400,000,000, or thereabouts, of 91-day
Treasury bills to be dated September 30 and to mature
December 30* 1942, which were offered on September 25, were
opened at the Federal Reserve Banks on September 28*
The details of this issue are as follows:
Total applied for - $725,763,000
Total accepted
- 401,288,000
Range of accepted bids:
High
Low
4 99.925 Equivalent rate of discount approximately
0,297 percent
4 99*905 Equivalent rate of discount approximately
0.376 percent
Average
Price '4 99^906 Equivalent rate of discount approximately
0.373 percent
(48
percent of the amount bid for at the low price was accepted)
-0O0
S e p t e m b e r 28,
1942
Passage of the Vandenberg amendment would jeopardize the
program for financing Old Age a n d Survivors» Insurance.
Sound
f i n a n c i n g r e q u i r e s t h a t S o c i a l S e c u r i t y c o n t r i b u t i o n s be c o l
l e c t e d at t h e s c h e d u l e d levels, e s p e c i a l l y d uring a p e r i o d of
v e r y h i g h i n c o m e s a n d e m p l o y m e n t s u c h as t h i s .
Passage of the Vandenberg amendment would also require sub
s t a n t i a l a d j u s t m e n t in t h e G o v e r n m e n t *s p l a n s f o r w a r f i n a n c i n g .
I t w o u l d , in eff e c t , r e d u c e t h e f l o w o f a n t i - i n f l a t i o n a r y funds*
into t h e T r e a s u r y by over #1 1/2 billion.
Everything t h a t we have u r g e d a n d p l a n n e d in t h e fight
a g a i n s t the r i s i n g cost o f living has been p r e d i c a t e d upon the
a s s u m p t i o n t h a t S o c i a l S e c u r i t y c o n t r i b u t i o n s w o u l d r i s e on
J a n u a r y 1, 1 9 4 3 t o t h e n e w s c h e d u l e s a d d i n g
to the c o n t r i
butions of employees and 1
to t h o s e o f e m p l o y e r s .
%
1%
T h e A d m i n i s t r a t i o n » s r e c o r d on S o c i a l S e c u r i t y h a s b e e n
clear and consistent,
hast January the President s u b m itted a
budget ba s e d on the a s s u m p t i o n that the sche d u l e d r ate increases
t
S e c u r i t y c o n t r i b u t i o n s w o u l d g o i n t o e f f e c t on J a n u a r y
811? ^ a t
a d d i t i o n , $ 2 b i l l i o n in n e w c o n t r i b u t i o n s
w o u l d be r a i s e d for an e x panded Soc i a l S e c u r i t y program.
When I a p p e a r e d before the House Ways and Means Committee
on larch 3^*d, I r e c o m m e n d e d a n e x p a n s i o n o f t h e S o c i a l S e c u r i t y
p r o g r a m as o u t l i n e d i n t h e P r e s i d e n t * s b u d g e t m e s s a g e o f l a s t
J a n u a r y , a n d I r e p e a t e d t h i s r e c o m m e n d a t i o n in m y l e t t e r to the
C o m m i t t e e on M a y 6th.
I strongly hope that the Senate Finance C o mmittee will
r e v e r s e its tenta t i v e a p p r o v a l of t h e Vanden b e r g amendment, be
cause t h e p a s s a g e of that ame n d m e n t w o u l d make our t ask harder
t h a n ever.
P a s s a g e o f t he V a n d e n b e r g a m e n d m e n t w o u l d j e o p ardize t h e
p r o g r a m f o r fin a n c i n g O l d A g e a n d S u r v i v o r s ’ Insurance*
Sound
fin a n c i n g r e q u i r e s that S o c i a l S e c u r i t y c o n t r i b u t i o n s be c o l
l e c t e d at t h e s c h e d u l e d levels, e s p e c i a l l y during a p e r i o d of
ver y h i g h incomes a n d emp l o y m e n t s u c h as this*
P a s s a g e o f t h e V a n d e n b e r g a m e n d m e n t w o u l d also r e q u i r e s u b
s t a n t i a l a d j u s t m e n t in the G o v e r n m e n t ’s p l ans for w a r financing.
It would, in effect, r e d u c e the f l o w of a n t i - i n f l a t i o n a r y funds
into t h e T r e a s u r y by o ver #1 1/2 billion*
E v e r y t h i n g t h a t w e h a v e u r g e d a n d p l a n n e d i n t h e fight
a g a i n s t th e r i s i n g c o s t o f l i v i n g has b e e n p r e d i c a t e d u p o n the
a s s u m p t i o n t h a t S o cial S e c u r i t y c o n t r i b u t i o n s w o u l d r i s e on
J a n u a r y 1, 1943 to the n e w sch e d u l e s a d d i n g 1 % to t h e c o n t r i
b u t ions of employees a n d 1% to t h o s e o f employers*
T h e A d m i n i s t r a t i o n ’s r e c o r d on S o c i a l S e c u r i t y has bee n
c l ear a n d consistent.
l ast J a n u a r y t he P r e s i d e n t s u b m i t t e d a
b u d g e t b a s e d on t he a s s u m p t i o n t h a t th e s c h e d u l e d r a t e increases
in S o c i a l S e c u r i t y c o n t r i b u t i o n s w o u l d go into effect on January
1» 1943» a nd t h a t in addition, $2 b i l l i o n in n e w c o n t r ibutions
w o u l d b e r a i s e d for an e x p a n d e d S o c i a l S e c u r i t y program*
W h e n I a p p e a r e d b e f o r e the H o u s e Way s a n d M e a n s C o m m i t t e e
on M a r c h 3rd, I r e c o m m e n d e d an ex p a n s i o n of the S o c i a l Security
p r o g r a m as o u t l i n e d in the P r e s i d e n t ’s b u d g e t m e s s a g e o f last
January, a n d I r e p e a t e d t h i s r e c o m m e n d a t i o n in my l e t t e r to the
C o m m i t t e e on M a y 6th.
I s t r o n g l y h o p e that th e S e n a t e F i n a n c e C o m m i t t e e w i l l
r e v e r s e its t e n t a t i v e a p p r o v a l of t h e V a n d e n b e r g amendment, be
c a use t h e p a s s a g e of t h a t a m e n d m e n t w o u l d m a k e ou r t a s k harder
t h a n ever.
T R E A S U R Y DEP A R T M E N T
Washington
P O R I M M E D I A T E RELEASE,
Monday, S e p t e m b e r 2g, 19*12.
P r e s s S e r vies
No. 33-56
S e c r e t a r y M o r g e n t h a u tdday m a d e the f o l l o w i n g statement:
80ïrçiiin
§|i
ationary j
thefight ;
ateiupontlii
H risem l
thecoite!
tj hasIss
;sMj)
i rate i n
fleet'oi'lf
P a s s a g e of the V a n d e n b e r g a m e ndment w o u l d J e o p ardize the p r o
gram for f i n a n c i n g O l d A g e and S u r v i v o r s 1 Insurance.
Sound finan
cin g re q u i r e s that S o cial S e c u r i t y .contributions be c o l l e c t e d at
the s c h eduled levels, e s p e c i a l l y d u r i n g a p e r i o d of v e r y h i g h
incomes a nd e m p l o y m e n t such as this.
P a s s a g e of the V a n d e n b e r g a m e n d m e n t w o u l d also r e q u i r e s u b
stantial a d j u s t m e n t in the G o v e r n m e n t s p l a n s for w a r financing.
It would, in effect, r e d u c e the f l o w of a n t i - i n f l a t i o n a r y funds
into the T r e a s u r y b y o v e r # 1 1 / 2 billion.
E v e r y t h i n g that we have u r g e d a nd p l a n n e d in the fight against
the r i s i n g cost of l i v i n g has b e e n p r e d i c a t e d u p o n the a s s u m p t i o n
that Social S e c u r i t y c o n t r i b u t i o n s w o u l d rise on J a n u a r y 1, 1 9 ^ 3
to the n e w sch e d u l e s a d d i n g 1% to the c o n t r i b u t i o n s of e m p l oyees
a nd 1 % to t h ose of employers.
costriMi
m igra.
jsns
ïsageoilîl;
fletterH
Bitteeill j
alesar
urtastai
T h e A d m i n i s t r a t i o n fs r e c o r d on Social S e c u r i t y has b e e n clear
and consistent.
L a s t J a n u a r y the P r e s i d e n t s u b mitted a budget
b a s e d on the a s s u m p t i o n that the s c h e d u l e d rate i n c reases in Social
S e c u r i t y c o n t r i b u t i o n s w o u l d go into effect on J a n u a r y 1, 1 9 ^ 3 , a n d
that in addition, $2 b i l l i o n in n e w c o n t r i b u t i o n s w o u l d be r a i s e d
for an e x p a n d e d S o c i a l S e c u r i t y program.
W h e n I a p p e a r e d b e f o r e the H o u s e W ays a n d M e a n s C o m m i t t e e on
M a r c h 3 rd, I r e c o m m e n d e d an e x p a n s i o n of the S o c i a l S e c u r i t y p r o
g r a m as o u t l i n e d in the P r e s i d e n t s b u d g e t m e s s a g e of last January,
a n d I r e p e a t e d t h i s r e c o m m e n d a t i o n in my l e t t e r to the C o m m i t t e e
on M a y 6 th.
I stron g l y h o p e that the S e nate F i n a n c e C o m m i t t e e will r e v e r s e
its t e n t a t i v e a p p r o v a l cf the V a n d e n b e r g amendment, b e c a u s e the
pa s s a g e of that a m e n d m e n t w o u l d m ake o ur t a s k h a r d e r than ever.
-0 O 0 -
"l'io definite rule for determining what is reasonable
in the case of expenditures for advertising can be laid
down m
advance so as to fit all situations and all classes
of taxpayers.
In determining whether the amounts are
reasonable it is necessary to take into consideration all
the facts and circumstances in each particular case.
"The Bureau will consider applications for indivi
dual rulings.
It is, however, busy with an unusual
volume ox yjOi*j£} stud ii is believed, if 'fcsixp&yers will
keep in mind the foregoing general rules, individual
rulings will not be necessary except under most, unusual
circumstances."
/ '
- 2 -
"In determining whether such expenditures are allow
able, cognizance will be taken of (l) the size of the busi
ness, (2) the amount of prior advertising budgets, (3) the
public patronage reasonably to be expected in the future,
(4) the increased cost of the elements entering into the
total of advertising expenditures, (5) the introduction of
new products and added lines, and (6) buying habits
necessitated by war restrictions, by priorities, and by
the unavailability of many of the raw materials formerly
fabricated into the advertised products.
"Reasonable expenses incurred by companies in
advertising and advertising technique to speed the war
effort among their own employees, to cut down accidents
*
and unnecessary absences and inefficiency, will be
allowed as deductions.
Also reasonable expenditures
for advertisements including the promotion of Government
objectives in wartime, such as conservation, salvage or
the sale of War Bonds, which are signed by the advertiser,
will be deductible provided, they are reasonable and are
not made in an attempt to avoid proper taxation.
"It is the statutory responsibility of the Bureau
to determine and collect Federal taxes, among which are
the income and excess profits taxes, and to prevent abuses
and attempts to avoid the high tax rates to which business
will be subject under the proposed tax bill now before
Congress.
xKüASURi IMPARI! LIMI
Bureau of Internal Revenue
j La ( M
FOR.
FORÀRELEASE
J
Té
Press
..SVfvV
■M.Êérye S" & é 4 ¿ / i r *
Commissioner Guy T. Helvering today issued an official statement
of the policy of xhe Bureau of Internal Revenue regarding the deduc
tion of advertising expenses for tax purposes.
The Commissioner
amplified public statements on the same subject previously made by
Secretary Morgenthau before the Joint Congressional Committee on
Internal Revenue Taxation on May 28, 1942^and by the Bureau itself
in correspondence with the Association of National Advertisers, Inc,
Commissioner Helvering’s statement followsI
To be deductible, advertising expenditures must be
ordinary and necessary and bear a reasonable relation to
the business activities in which the enterprise is engaged.
ihe Bureau recognizes that advertising is a necessary and
legitimate business expense so long as it is not carried
to an unreasonable extent or does not become an attempt to
avoid proper tax payments.
The Bureau realizes that it may be necessary for tax
payers now engaged m
war production to maintain, through
advertising, their trade names and the knowledge of the
quality of their products and good will built up over past
years, so that when they return to peace-time production
tneir names and the quality of their products will be
TREASURY DEPARTMENT
'
B u r e a u of I n t ernal R e v e n u e
Washington
FO R I M M E D I A T E RELEASE,
Tuesday, S e p t e m b e r 29»
press Service
N o . 3 3 .4 7
19^-2,
C o m m i s s i o n e r G u y T, H e l v e r i n g today Issued an of f i c i a l s t a t e
ment of the p o l i c y of the B u r e a u of I n t e r n a l R e v e n u e r e g a r d i n g the
d e d u c t i o n of a d v e r t i s i n g expenses f or t a x purposes.
T he C o m m i s
sioner a m p l i f i e d p u b l i c s t a t ements on the same subject p r e v i o u s l y
mad e by S e c r e t a r y M o r g e n t h a u b e f o r e the J o int C o n g r e s s i o n a l C o m
m i t t e e on Internal R e v e n u e T a x a t i o n on M a y 36,
194-2,
a n d b y the
B u r e a u itself in c o r r e s p o n d e n c e w i t h the A s s o c i a t i o n of N a t i o n a l
Advertisers,
Inc,
C o m m i s s i o n e r H e l v e r i n g fs statement follows:
11To be deductible, a d v e r t i s i n g expen d i t u r e s m u s t be
o r d i n a r y a n d n e c e s s a r y and b e a r a r e a s o n a b l e r e l a t i o n to '
the b u s i n e s s a c t i v i t i e s in w h i c h the enterprise is engaged.
T h e B u reau r e c o g n i z e s that a d v e r t i s i n g is a n e c e s s a r y a n d
l e g i t i m a t e b u s i n e s s expense so l o n g as it is not c a r r i e d
to an u n r e a s o n a b l e extent or does not b e c o m e an attempt to
a v o i d p r o p e r t a x payments,
"The B u r e a u r e a lizes that it m a y be n e c e s s a r y f or t a x
payers n ow e n g a g e d in w a r p r o d u c t i o n to maintain, t h r o u g h
advertising, t h e i r trade names a n d t he k n o w l e d g e of the
q u a l i t y of t h eir p r o ducts and goo d will b u ilt u p ove r pas t
years, so that w h e n they r e t u r n to p e a c e - t i m e p r o d u c t i o n
t h e i r names a n d the q u a l i t y of t h e i r pr o d u c t s w i l l be
k n o w n to the public,
,
“In d e t e r m i n i n g w h e t h e r such e x p e n d i t u r e s are allowable, c o g n i z a n c e will be taken of ( 1 ) the size of the b u s i
ness, ( 2 ) the amount of p r i o r a d v e r t i s i n g budgets, ( 3 ) the
p u b l i c p a t r o n a g e r e a s o n a b l y to be e x p e c t e d in the future,
(4; the i n c r e a s e d cost of the elements en t e r i n g into the
total of a d v e r t i s i n g expenditures, ( 5 ) the i n t r o d u c t i o n of
n e w p r o d u c t s a n d a d d e d lines, a n d ( 6 ) b u y i n g h a bits n e c e s
s i tated by w a r restrictions, b y priorities, and by the
2
u n a v a i l a b i l i t y o f m a n y of the r a w materlals__formerly
f a b r i c a t e d into the a d v e r t i s e d products.
“R e a s o n a b l e e x p e n s e s in c u r r e d b y c o m p anies in
a d v e r t i s i n g a n d a d v e r t i s i n g t e c h n i q u e to speed the w a r
effort a m o n g t h e i r own employees, a n d to cut down a c c i
dents and u n n e c e s s a r y ab s e n c e s and inefficiency, will be
a l l o w e d as deductions.
A l s o r e a s o n a b l e e xpenditures
for a d v e r t i s e m e n t s i n c l u d i n g the p r o m o t i o n of G o v e r n m e n t
obj e c t i v e s in wartime, such as conservation, salvage or
the sale of W a r Bonds, w h i c h are s i g n e d by the advertiser,
^will be d e d u c t i b l e p r o v i d e d t h e y are r e a s o n a b l e and are
not mad e in an attempt to avoid p r o p e r taxation.
“It Is the sta t u t o r y r e s p o n s i b i l i t y of the B u r e a u
to d e t e r m i n e and collect F e d e r a l taxes, a m o n g w h i c h are
the income and e x cess p r o f i t s taxes, and to pr e v e n t abuses
a nd a t t e m p t s to a v o i d the h i g h t a x r a t e s to w h i c h b u s i n e s s
will be subject u n d e r the p r o p o s e d t a x b ill no w b e f o r e
Congress.
“No d e f i n i t e r u l e for d e t e r m i n i n g what is r e a s o n a b l e
in the case of e x p e n d i t u r e s for a d v e r t i s i n g c an be l aid
down in a d v a n c e so as to fit all s i t u ations a n d all classes
of taxpayers.
In d e t e r m i n i n g w h e t h e r the amounts are
r e a s o n a b l e it is n e c e s s a r y to take into c o n s i d e r a t i o n all
the facts a n d c i r c u m s t a n c e s in e a c h p a r t i c u l a r ease.
“T h e B u r e a u w i l l c o n s i d e r a p p l i c a t i o n s for indi v i d u a l
rulings.
It is, however, b u s y with an u n u s u a l v o l u m e of
work, and it is b e l i e v e d that if tax p a y e r s will k e e p in
m i n d the f o r e g o i n g g e n e r a l rules, i n d i vidual ru l i n g s will
not be n e c e s s a r y except u n d e r mos t u n u s u a l c i r c u m s t a n c e ^ .“
-o0o~
-
2
-
Sales of Tax Savings Notes in September by federal Reserve
districts, etc*, follows:
Boston - - - -- - New Y o r k -------- --
oc«
$57,-61 ^ 590
^ V X çoo
0 ÖO
Philadelphia - - - Cleveland
----
--
71.303. w 77JÉ; O O o
io 7 ,fe frro o
Richmond---- -----
35.295.-*«5-
Atlanta
------ ----
20,365t 9?5
Chicago
- ----- -
l4g,650,000
ûoo
St* Louis
- - - - - -
¿?c>3 co©
44,60^55»&S Ÿ O GG
M i n n e a p o l i s ------- -
14,8567550
Kansas City
20,564,850
- - - - -
Dallas - - - - - San Francisco
---
o©<?
- - - -
Treasury - - - - - - Unclassified - - - - -
TOTAL
-
12 ,9 61 ,50e-
G ©O
709,1+50»00
67 ,15 ©3 o h t *oa
TREASURY DEPARTMENT
Washington
FOR IMMEDIATE RELEASE
Friday, October 2, I 9U 2.
Press Service
~}U
Secretary
3'
3
Morgenthau announced today that
sales of Treasury Tax Savings Notes during September totaled
y
$929,000,000, or more than double the sales of $^18,000,000
during the preceding month.
With the exception of the first
month of issue in August, 19^-1» when sales totaled $lt/p37»000*000,
this was the largest monthly total on.record.
/
j
r
f
v
j
^
K
—-I
sL ^
[ÎfiTe September tofeàl includes the sales of Séries A, B and
C Notes. Sale
rfs
of Series A and B Notes was suspended on Saturday,
September 12, and new Series A and C Notes, which provide greater
flexibility, were placed on sale on Monday, September lU.
The
principal changes in Series A Notes was the raising of the limit
which might be presented in payment of taxes in any one year from
$1200
to
years.
$5000
and extending the maturity of the notes to three
This limit applies separately to Federal income, estate
and gift taxes.
In the case of joint returns, husband and wife
are each permitted to present a maximum of $5000 in Series A Notes
in any one year in payment of taxes of each class.
Of the total of $929*000,000 in Tax Savings Notes sold last
month, the sum of $8^6,000,000 represented the purchase of new notes
issued on and after September
19^2^*«* |he balance of $83,000,000
represented sales of old Series A and B Notes prior to September lH.
o-e-o
)
-5T\/
A
.
A
^ 4 ^ .
"X-W-î
ftj
TREASURY DEPARTMENT
Washington
FO R I M M E D I A T E RELEASE,
Friday, O c t o b e r 2, 1942.
P r e s s Service
No, 33-H-g
S e c r e t a r y M o r g e n t h a u a n n o u n c e d t o d a y t h a t sales of T r e a s u r y
T a x Savings Notes d u r i n g S e p t e m b e r t o t a l e d $ 9 2 9 , 0 0 0 ,000,
t han double the sales of $^-18,
0 0 0 ,0 0 0 d u r i n g the p r e c e d i n g month.
W i t h the e x c e p t i o n of the first m o n t h of issue in August,
w h e n sales
or more
19^1,
t o t a l e d $ 1 , 0 3 7 »0 0 0 »0 0 0 , this was the largest m o n t h l y
total on record.
This
sh o w i n g d e m o n s t r a t e s
of the w o r k of the V i c t o r y F u n d Committees,
the e f f e c tiveness
o f f i cials
said.
The S e p t e m b e r total includes the sales of Series A, B and
C Notes.
Sale of Series A and B Notes was sus p e n d e d on Saturday,
S e p t e m b e r 12, and new Series A a nd C Notes, w h i c h p r o v i d e g r e a t e r
flexibility, were p l a c e d on sale on Monday, S e p t e m b e r lty-. Th e
In Series A N o t e s was the r a i s i n g of the limit
w h i c h m i g h t be p r e s e n t e d in p a y ment of taxes in any one y e a r f rom
$ 1 2 0 0 to $ 5 0 0 0 a n d e x t e n d i n g the m a t u r i t y of the notes to three
years. Thi s limit applies s e p a r a t e l y to F e d eral income, e s tate
and gift taxes.
In the case of Joint returns, h u s b a n d and wife
are each p e r m i t t e d to present a m a x i m u m of $5000 in Series A
Notes in any one y e a r in p a y m e n t of taxes of e ach class.
of, $ 9 2 9 , 0 0 0 , 0 0 0 in T a x Savings N o tes sold last
month, the sum of $ 8 4 6 , 0 0 0 , 0 0 0 r e p r e s e n t e d the p u r c h a s e of n e w
notes issued on a n d a f t e r S e p t e m b e r 14-, 1 9 L 2 . T h e b a l a n c e of
$ 8 3 , 0 0 0 , 0 0 0 r e p r e s e n t e d sales of o l d Series A and B Notes p r i o r
to S e p t e m b e r 14, of w h i c h a p p r o x i m a t e l y $ 4 8 , 0 0 0 , 0 0 0 were e x
c h a n g e d f or the ne w series notes d u r i n g September,
2
Sales of T a x Savings N o tes
R e s e r v e districts,
etc.,
.n S e p t e m b e r b y F e d e r a l
follows
Boston - - - - - - -
#57,615,000
New York - - - - - -
31+1,925,000
P h i l a d e l p h i a •*-*?«Cleveland
- - - - -
71.303.000
107,721+, 000
Richmond - - - - - -
3 5 . 2 9 5 . 0 00
Atlanta
- - - - - -
20 .356.000
C h i cago
- - - - - -
11+2,650,000
- - - - -
W-, 003,000
Minneapolis
- - - -
1 ^ ,3 5 9 , 0 0 0
K a n s a s City
- - - -
20.965.000
St. Louis
Dall a s
12.961.000
- - - - - -
San F r a n cisco
- - -
709,000
Treasury - - - - - Unclassified - - - T O T A L ----- --
5 2 . 042.000
-
-0 O 0 -
67,000
1929,303,000
'
October 2 t 19*12.
STATUTORY DEBT LIMITATION
AS OF SEPTEMBER 50. I9M-2
Section 21 of the Second Liberty Bond Act, as amended, provides that the fac®
amount of obligations issued under authority of that Act, "shall not exceed in the
aggregate $ 12 5 ,000,000,000 outstanding at any one time."
The following table shows the face amount of obligations outstanding and the fa®
amount which can still be issued under this limitation:
Total face amount that may be
outstanding at any one time
$ 12 5 ,000,000,000!
Outstanding as of September 30» 19^2:
Interest-bearing:
Bonds $^l>lS, 0^ 5 ,g50
Treasury
Savings (Maturity
value)*
15 .27^,7^.950
Depositary
ÿt.079,000
Adjusted Service
726.155.857
Treasury notes
Certificates of
indebtedness
Treasury bills
(Maturity value)
$ 5 7 .5 13 .025,657
1 6 ,7 77 .291.000
9.537.7'+2,000
l*.6 18 .862.000
Matured obligations, on
which interest has ceased
Debt bearing no interest (U.S.
Savings Stamps)
IPace amount of obligations
issuable under above authority
\
91 ,1*20,050
180,971.818
J
88,719.312.525
$ 56.280.687.lt7S
À
October 5, 1942.
STATUTORY DEBT LIMITATION.
AS OP SEPTEMBER 30. 1942
Section 21 of the Second Liberty Bond Act, as amended, provides that the
face amount of obligations issued under authority of that Act, 11shall not ex
ceed in the aggregate $125,000,000,000 outstanding at any one time."
The following table shows the face amount of obligations outstanding and
the face amount which can still be issued under this limitation:
Total face amount that may be
outstanding at any one time
Outstanding as of September 30, 1942:
Interest-bearing:
Bonds Treasury
$41,413,045,850
Savings (Maturity
value)*
15,274,744,950
Decositary
94,079,000
Adjusted Service
726,155.857
Treasury notes
Certificates of
indebtedness
Treasury bills
(Maturity value)
$125,000,000,000
$57,513,025,657
16,777,291,000
9.537.742.000
4.618.862.000
Matured obligations, on
which interest has ceased
Debt bearing no interest
(U. S. Savings Stamps)
30,933,895,000
88,446,920,657
91,420,050
180,971,818
Face amount of obligations
issuable under above authority
88,719,312,525
$ 36,280,687,475
Reconcilement with Daily Statement of the United States Treasury
September 30, 1942
Total face amount of outstanding public debt obligations
issued under authority of the Second Liberty Bond Act,
as amended
Deduct, unearned discount on Savings bonds (difference
between current redemption value and maturity value)
Add other public debt obligations outstanding but not
subject to the statutory limitation:
Interest-bearing (Pre-War, etc.)
$
195,969,620
Matured obligations on which interest
has ceased
10,707,340
Bearing no interest
353,434,177
Total gross debt outstanding as of September 30, 1942
$ 88,719,312,525
2,795,933,467
85,923,379,058
560,111,137
$ 86,483,490,195
•“Approximate maturity value. Principal amount (current redemption value)
according to preliminary public debt statement $12,478,811,483.
TREASURY NOTES—TAX SERIES A-1945
Purchase Price and Tax-Payment Value During Successive Months
T h e t a b l e b e lo w s h o w s t h e p r i n c i p a l a m o u n t w it h a c c r u e d i n t e r e s t a d d e d , f o r n o t e s o f e a c h d e n o m in a tio n f o r e a c h
m o n th f r o m S e p t e m b e r 1 9 4 2 t o S e p t e m b e r 1 9 4 o ? i n c lu s iv e . T h e t o t s l s h o w n f o r s l y i y d e n o m in a tio n f o r a n y m o n t h w h ile
th e n o te s r e m a i n o n s a le , i s t h e p u r c h a s e p r i c e , o r c o s t o f t h e n o t e d u r in g t h a t m o n t h . A lso t h e t o t a l s h o w n f o r a n y d e
n o m in a tio n f o r a n y m o n t h is t h e t a x - p a y m e n t v a lu e o f t h e n o t e i f r e c e iv a b l e d u r in g t h a t m o n t h i n p a y m e n t o f t a x e s .
$25
1942:
S e p t e m b e r ___
O c to b e r ___
N o v e m b e r ___
D e c e m b e r ___
1943:
J a n u a r y ______
Febru ary
—
M a rch
_____
A p r il . . .
..
M ay.
___
Ju n e .
J u l y ---------------A u g u st
.
S e p t e m b e r ___
O c to b e r _ .
N o v e m b e r ___
D e c e m b e r ___
1944:
Ja n u a r y . ..
F e b r u a r y ___
M a r c h ____ !
A p r il__________
M ay _ — .
Ju n e .
. .
J u l y __________
A u g u st ..
S e p t e m b e r ___
O c to b e r .
N o v e m b e r ___
D ecem ber
1945:
J a n u a r y .. _
F e b r u a r y _____
M a r c h ______
A p r il
_ .
_____
M a y ..
J u n e ..
J u l y _________
A u gu st
S e p te m b e r ___
$50
$100
$25.
25.
25.
25.
00
04
08
12
25.
25.
25.
25.
25.
25.
25.
25.
25.
25.
25.
25.
16
20
24
28
32
36
40
44
48
52
56
60
50.
50.
50.
50.
50.
50.
50.
50.
50.
51.
51.
51.
25.
25.
25.
25.
25.
25.
25.
25.
25.
26.
26.
26.
64
68
72
76
80
84
88
92
96
00
04
08
26.
26.
26.
26.
26.
26.
26.
26.
26.
12
16
20
24
28
32
36
40
44
$50. 00
50. 0 8
50. 16
5 0 .2 4
$500
$ 1 ,0 0 0
$100.
100.
100.
100.
00
16
32
48
$500.
500.
501.
502.
00
80
60
40
32
40
48
56
64
72
80
88
96
04
12
20
100.
100.
100.
101.
101.
101.
101.
101.
101.
102.
102.
102.
64
80
96
12
28
44
60
76
92
08
24
40
503.
504.
504.
505.
506.
507.
508.
508.
509.
510.
511.
512.
20
00
80
60
40
20
00
80
60
40
20
00
1,
1,
I
I
1,
1,
1,
1,
1,
L,
1,
1,
51.
51.
51.
51.
51.
51.
51.
51.
51.
52.
52.
52.
28
36
44
52
60
68
76
84
92
00
08
16
102.
102.
102.
103.
103.
103.
103.
103.
103.
104.
104.
104.
56
72
88
04
20
36
52
68
84
00
16
32
512.
513.
514.
515.
516.
516.
517.
518.
519.
520.
' 520.
521.
52.
52.
52.
52.
52.
52.
52.
52.
52.
24
32
40
48
56
64
72
80
88
104.
104.
104.
104.
105.
105.
105.
105.
105.
48
64
80
96
12
28
44
60
76
522.
523.
524.
524.
525.
526.
527.
528.
528.
U. S. GOVERNMENT PRINTII
OFFl<
#4000
$1, 000.
1, 0 0 1 .
M 003.
1, 0 0 4 .
$ 5 ,0 0 0
00
60
20
80
$5,
5,
5
5,’
000
008
016
024
006.
008.
009.
O il.
012.
014.
016.
017.
019.
020.
022.
024.
40
00
60
20
80
40
00
60
20
80
40
00
5
5,
5,
5,
5,
5,
5,
5
5,
5
5
5
032
040
048
056
064
072
080
088
096
104
112
120
80
60
40
20
00
80
60
40
20
00
80
60
1, 0 2 5 .
1, 0 2 7 .
1, 0 2 8 .
t, 0 3 0 .
i; 032.
1, 0 3 3 .
1, 0 3 5 .
1, 0 3 6 .
1. 0 3 8 .
1, 0 4 0 .
| 041.
i; 043.
60
20
80
40
00
60
20
80
40
00
60
20
5,
5,
5,
5,
5,
5,
5,
5,
5,
5
5,
5,
128
136
144
152
160
168
176
184
192
200
208
216
40
20
00
80
60
40
20
00
80
1,
1,
1,
1,
80
40
00
60
20
80
40
00
60
5,
5,
5,
5,
5,
5,
5,
5
5,
224
232
240
248
256
264
272
280
288
1,
I
i;
1,
l'
044.
046.
048.
049.
051.
052.
054.
056.
057.
UNITED
f
STATES
OF
AMERICA
TREASURY TAX SAVING NOTES
Tax Series A-1945
Dated September 1,1942
Due September 1,1945
Issued at Par and Accrued Interest
Acceptable at Par and Accrued Interest in Payment of Federal Income, Estate, and Gift Taxes
TREASURY DEPARTMENT,
Department O r L a r No. 695
.-------Fiscal Service
Of f ic e
#
of th e
Secretary,
’
W ashington, Septem ber 1 2 , 194.2.
BureauofthePublicDebt
I.
OFFERING OF NOTES
1.
The Secretary of the Treasury, pursuant to the authority ofthe Second Liberty Bond Act
as amended, offers forsale,to the people of the United States, at par and accrued interest an issue
wlSnntrfnSferan G notS. of the Umted States, designated Treasury Notes of Tax Series A-1945
Federal
and
$ receivable, at par and accrued interest, in payment of
nated'by^theSecr^aiy of'tte Tr^asu^feP*em*>er 14’1942’and the Sale WiU continue until| g §
1
SS
sal<?of Treasury Notes of Tax Series A-1944, pursuant to Treasury Department CircuNo. 674, dated December 15, 1941, willterminate atthe closeofbusiness on September 12,1942.
in S p t w w * ° l a TreaSU7 not\Tax Series A-1944, purchased and bearing a date of issue
ber 1942, may surrender such note on or before October 31, 1942, to the agency which
issuedthe note and receivem exchange therefor a Treasury note, Tax Series A-1945, of like face
f£oant mf.r\bed « the same name and bearing the same date o f issue, together with a refund of
the accrued interestincluded inthe pricepaid for the surrendered note.
II.
DESCRIPTION OF NOTES
1. G eneral.— The notes will be dated September 1, 1942Ithey will maturp SentamW 1 1 cm*
?n<Lm 7 n?\be calledby the Secretary of the Treasury for redemption before maturity. Subiect
to t e limitations and conditions setforth in SectionIV ofthiscircular,thenoteswillbe receivable
at par and accrued interest, m payment of Federal income, estate,and gifttaxes. Ifthe notes are
not presented in payment of taxes, they willbe payable at maturity, or, at the owner’s option and
they Wl11 be redeemable before maturity, as provided in Section V of this circular but to
either case payment will be made only at the price paid for the notes.
’ m
2. F orm inscription, (kiting.— The owner’s name and address will be entered on each note at
!fs\ssae b^an authorized issuingagent,and thedateofissuewillbeshown by an imprint
te® agpnt® dating stamp. The month m which payment is received and credited by a Federal
Sfe?, Bank Branch or by the Treasurer oftheUnitedStates,willdeterminethepu4Lse price
and issue date of each note. The notesmay not be transferred, except, that ifnotes are held by a
corporation owning more than 50 percent ofthe stock, with voting power, of another coloration
such notes may be transferred tothe subsidiary upon request of the corporation and surSer of
n^Jq°KeS
ageite
issuedthem. No hypothecationofthenoteson anyaccountwillberecog
nized by the Treasury Department and they willnotbeacceptedtosecuredepositsofpublicmoney.
lV'
t
.erest‘~The notes will be issued in denominations of $25, $50, $100
$500, $1,000, and $5,000, and interestthereon willaccrue from September 1942 inthe amount of 1 a
centseachmonth on each $100 principalamount of note. In no case, h o w e ^
beyond the month m which the note is presented in payment of taxes, or beyond its maturftv
Exchanges of authorized denominations from highertolower,but notfrom lowertohigher mavbe
arranged at the officeof the agent that issued the note.
nigner,may Pe
3 . 4: P urchase p rice and tax-paym ent value.—A table is appended to this circular showing thp
principal amount,with accrued^interest added, fornotesofe^ch denoiruiiAtid^^^%££w
S^tember 1942 to September 1945, inclusive. The totalshown forany denomination foranv month
whilethe notes remain on sale,isthe purchase price, or cost, of the note during that month7 Also
the total shown for any denomination for any month isthe tax-payment value ofthe note ifreceiv
ableduring thatmonth inpayment oftaxes,subject to the provisions of Section IV of thiscircular.
5.
Taxation .
— Income derived from the notesshallbe subjecttoallFederaltaxes,now orhere
after imposed. The notes shall be subject to estate,inheritance,giftorotherexcisetaxes,whether
Federal orState,butshallbeexempt from alltaxation now or hereafter imposed on the principal or
interestthereof by any State, orany ofthe possessions of the United States, or.byany local-taxing
authority.
III. PURCHASE OF NOTES
1. A pplications and paym ent.— Applications willbereceivedby theFederalReserveBanks and
Branches, and by the Treasurer of the United States,Washington, D. C. Banking institutionsand
security dealers generally may submit applications for account of customers, but only the Federal
Reserve Banks and the Treasury Department are authorizedtoact-asofficialagencies. Everyappli
cationmust be accompanied by payment infull,at par and accrued interest from September 1942
tothemonth inwhich payment inimmediatelyavailablefundsisreceivedby a Federal Reserve Bank
or Branch, ortheTreasureroftheUnited States. Any form ofexchange, includingpersonalchecks,
willbe acceptedsubjecttocollection,and should be drawn to the order ofthe Federal Reserve Bank
oroftheTreasureroftheUnited States,aspayee, as the case may be;War Savings Stamps willbe
accepted attheirfacevalue inlieuofcash. The date funds are made available on collection of ex
change will govern the issue price and issue date of the notes. Any depositary, qualified pursuant
to the provisions of Treasury Department Circular No. 92 (revised February 23, 1932, as'supple
mented) will be permitted to make payment by creditfornotes appliedforon behalfof itselfor its
customers up to any amount for which itshall be qualifiedinexcessofexistingdeposits.
2. R eservations .— The Secretaryof the Treasury reservestherighttorejectanyapplicationin
whole or inpart,and torefusetoissueorpermitto be issued hereunder any notes in any case or in
any class or classes ofcases ifhe deems such actiontobeinthepublicinterest,and hisactioninany
such respect shall be final. Ifan application isrejected, inwhole or inpart,any payment received
thereforwillberefunded. The SecretaryoftheTreasury, in his discretion, may designate agencies
other than those herein provided for the sale of,or for4he handling of applications for, Treasury
notes to foeissued hereunder.
.
3. D elivery o f notes .— Upon acceptance of full-paid applications, notes willbe duly issued and,
unless delivered in person, will be delivered within the Continental United States, the Territories
and Insular Possessions of the United'States, and the Canal Zone. No deliveries elsewhere willbe
made.
4. Form o f application *— Inapplyingfornotes under this circular, care should be exercised to
specify that notes of Tax Series A;
-1945 are desired, and there must be furnished the name and
address of the individual, corporation, or other entity in which the notes are to be issued; and if
address for the delivery of the notes is-different, appropriate instructions should be given. The
name should be inthe same form asthatused intheFederaltaxreturnofthepurchaser,exceptthat
in the case of joint tax returns of individuals, thenotesshouldbe inscribedindividually— thenotes
willnot be issued inthenames oftwo ormore persons jointly. The application should be accom
paniedby remittancetocoverthepurchaseprice— that is,par— together with accrued interest from
September 1942 to the month in which the applicationwillbe received and the remittance collected
by an authorizedissuingagent. The useofanofficial application form is desirable, but not neces
sary. Appropriateformgmay be obtainedon applicationtoany Federal Reserve Bank or Branch, or
the Treasurer of the United States, Washington, D. C.;banking institutions and security dealers
generallywillbe suppliedwithforms fortheuseof their customers.
1
IV. PRESENTATION IN PAYMENT OF TAXES
1. During and afterthe second calendar month after the month of purchase (as shown by the
issuing agent’s dating stamp on each note),during such time, and under such rules and regulations
as the Commissioner ofInternal Revenue, with the approval of the Secretary ofthe Treasury, shall
prescribe, notes issuedhereunderinthename ofa taxpayer (individual,corporation,orotherentity)
may be presented and surrendered, tothe extenthereinaftersetforth,bysuchtaxpayer,hisagent,or
his estate,tothe Collectorof InternalRevenue to whom the tax return ismade, and will be receiv
able by the Collector at par and accrued interestfrom September 1942tothemonth, inclusive (but
no accrual beyond September 1945), in which presented in payment of any Federal income taxes
(currentand back personal and corporationtaxes,and excess-profitstaxes),orany Federal estateor
gifttaxes (current and back),assessedagainsttheoriginalpurchaser orhisestate. Notwithstand
ingtheprovisionsofDepartment CircularNo. 667,asamended, and ofDepartment CircularNo. 674,
the Collectorwillaccept (a )notmore than $5,000 principal amount of notes ofTax Series A-1945,
or of Tax Series A-1943, or of Tax Series A-1944, or of any of them in combination, and (5) the
amount ofthe accrued interestthereon, on account of any one taxpayer’s liability for each class of
taxes (income, estate, or gift) for each taxable period: Provided, That this limitation shall apply
separately to husband and wife on a joint return, and shall apply separately to an owner before
death and tohis estateforthebalance ofthesame year. The notesmust be forwarded tothe Collec
tor at the risk and expense of the owner, and, for the owner’s protection, should be forwarded by
registeredmail, ifnot presented in person.
V. CASH REDEMPTION AT OR PRIOR TO MATURITY
1. G eneral.— Any Treasury Note of Tax Series A-1945, bearing a properly executed request
forpayment, willbe redeemed for cash atthe purchase priceatorbeforematurity, without advance
notice,following presentationtotheagentthatissuedthenote.
2. Execution o f request fo r paym ent.— The owner inwhose name thenoteisinscribedmust ap
pear before one of the officers authorized by the Secretary of the Treasury to witness and certify
requests for payment, establish his identity, and in the presence of such officersign the request for
payment appearingon theback ofthenote,adding the addresstowhich checkistobemailed. After
the requestforpayment has been sosigned, thewitnessing officershould complete and sign the cer
tificateprovided forhisuse.
3. Officers authorized to w itness and certify requests f or paym ent.— All officers authorized to
witness and certify requests for payment of United States Savings Bonds, as setforth in Treasury
Department Circular No. 530, FifthRevision, are hereby authorized to witness and certify requests
for cash redemption of Treasury notes issued under this circular. Such officers include, among
others, United States postmasters, certain otherpost officeofficials,and the officersofallbanks and
trustcompanies incorporated inthe United States or itsorganized territories, including officers at
branches thereof.
4. P resentation and surrender.— Notes bearingproperlyexecutedrequestsforpaymentmustbe
presentedand surrenderedtotheagentthatissuedthenotes (asshown by theagent’sdatingstamp),
atthe expense and riskoftheowner. Forthe owner’sprotection,notesshouldbeforwarded byreg
isteredmail,ifnot presented inperson.
5. D isability or death.— In caseof the disability or death ofthe owner, and the notes are notto
be presented inpayment of Federal income, estate,orgifttaxes due from him or from hisestate, in
structionsshould be obtained from the issuingagent beforethe request for payment isexecuted, or
thenotes presented.
6. P artial redem ption.— Partial cash redemption of notes corresponding to an authorized de
nomination may be made inthesame manner as forfullcashredemption,appropriatechangesbeing
made inthe request for payment. In case of partial redemption of a note, the remainder will be
reissued inthesame name and with thesame date of issueas the note surrendered.
7. Paym ent.— Payment of any note, eitherat maturity or on redemption before maturity, will
be made only by the Federal Reserve Bank or Branch, ortheTreasuryDepartment, asthecasemay
be,that issuedthe note,and willbe made by check drawn totheorderoftheowner, andmailedtothe
address given inhisrequestfor payment. In any case, payment will be made atthe purchase price
ofthe note— that is,atpar and accrued interest (ifany) paid atthe time ofpurchase.
VI. GENERAL PROVISIONS
1. Except as provided inthiscircular, the notes issuedhereunder willbe subjecttothegeneral
regulations of the Treasury Department, now or hereafter prescribed, governing bonds and notes
ofthe United States.
2. Federal Reserve Banks and their Branches, as fiscalagents of the United States, are author
izedto perform such services or acts as may be appropriate and necessary under the provisions of
this circular, and under any instructions given by the Secretary ofthe Treasury.
3. The SecretaryoftheTreasury may atany timeorfrom timetotime supplementoramend the
terms ofthiscircular,orofany amendments orsupplements thereto, and may at any time or from
time totime prescribe amendatory rules and regulations governing the offering of the notes, infor
mation astowhich willpromptly be furnished tothe Federal Reserve Banks.
HENRY MORGENTHAU, JR.,
S ecretary o f the Treasury.
(Filed with the Division of the Federal Register, September 14, 1942)
TREASURY DEPARTMENT
Washington
FOR RELEASE, MORNING NEWSPAPERS
Tuesday, October 6, 1942,______
10/ 5/42
m
I
Press Service
_
*IW
'
3 J 1 ^ vSi
The Secretary of the Treasury announced last evening that the tenders for
#400,000,000, or thereabouts, of 91-day Treasury bills to be dated October 7, 1942 ^
*11
and to mature January 6 , 1943, which were offered on October 2, were opened at the
Federal Reserve Banks on October 5*
The details of this issue are as follows:
Total appliedfor - $773>618,000
Total accepted
- 400,572,000
4
Range of accepted bids:
I
High
Low
Average price
- 99.924 Equivalent rate of discount approx. 0.301$ per annus
- 99.905
- 99.907
"
**
•
*
•
h
•
•
*
»
0 ,376 $
0 .369$ *
(14 percent of the amount bid for at the low price was accepted.)
MB
m
hi»|3
T R E A S U R Y D E P A RTMENT
Washington
F OR RELEASE, MORN I NO- N E W S P A P E R S
Tuesday, O c t o b e r 6, 19*1-2._______
10/5/42
Press Service
No. 3 3 -50
T he Secretary of the T r e a s u r y a n n o u n c e d last e v e ning that
the tenders for $400,000,000,
bills to be d a ted O c t o b e r 7*
or thereabouts,
19^2,
of 9 1 - ^ a y T r e a s u r y
a n d to m a t u r e J a n u a r y 6,
1943,
w h i c h were o f f e r e d on O c t o b e r 2, were o p e n e d at the F e d e r a l
R e s e r v e Banks on O c t o b e r 5*
T he details of this issue are as follows:
Total applied for - $773,613,000
Total accepted
400,572,000
R a n g e of a c c e p t e d bids:
High
Low
- 9 9 * 9 2 4 E q u i v a l e n t rate of discount approx.
p er a n num
- 99.905 E q u i v a l e n t rate of discount approx.
p e r a n num
0.301#
approx.
O.369#
•
Average
P r i c e - 9 9 . 9 0 7 E q u i v a l e n t rate of discount
p e r annum
0
(14 p e r c e n t of the amou n t b i d for at the l o w p r i c e was accepted.)
- 3 -
issue or on subsequent purchase, and the amount actually received either
upon sale or redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss.
Treasury Department Circular No, 418, as amended, and this
notice, prescribe the terms of the Treasury bills and govern the condi
tions of their issue.
Copies of the circular may be obtained from any
Federal Heserve Bank or Branch,
j
-
2
-
Reserve Ranks and Branches, following which public announcement will be made
.
by the Secretary of the Treasury of the amount and price range of accepted
bids.
Those submitting tenders will be advised of the acceptance or rejec
tion thereof.
The Secretary of the Treasury expressly reserves the right
to accept or reject any or all tenders, in whole or in part, and his action
in any such respect shall be final*
Payment of accepted tenders at the
prices offered must be made or completed at the Federal Reserve Bank in
cash or other immediately available funds on
October 14, 1942_________ •
The income derived from Treasury bills, whether interest or gain
from the sale or other disposition of the bills, shall not have any exemption,
j
as such, and loss from the sale or other disposition of Treasury bills shall
not have any special treatment, as such, under Federal tax Acts now or here
after enacted.
The bills shall be subject to estate, inheritance, gift, or
other excise taxes, whether Federal or State, but shall be exempt from all
taxation now or hereafter imposed on the principal or interest thereof by
any State, or any of the possessions of the United States, or by any local
taxing authority*
For purposes of taxation the amount of discount at which
Treasury bills are originally sold by the United States shall be considered
to be interest*
Under Sections 42 and 117 (a) (l) of the Internal Revenue
I
Code, as amended by Section 115 of the Revenue Act of 1941, the amount of
discount at which bills issued hereunder are sold shall not be considered
to accrue until such bills shall be sold, redeemed or otherwise disposed
of, and such bills are excluded from consideration as capital assets.
Accordingly, the owner of Treasury bills (other than life insurance com
panies) issued hereunder need include in his income tax return only the
difference between the price paid for such bills, whether on original
J
TREASURY DEPARTMENT
Washington
EOR RELEASE, MORNING NEWSPAPERS,,
3-
Wednesday, October 7» 19A2
f
The Secretary of the treasury, "by this public notice, invites tenders
for fr400,000,000
or thereabouts, of
91 -day Treasury bills, to be issued
on a discount basis under competitive bidding.
he dated
October 1A. 19A2
The Dills of this series will
. and will mature
January 13, 19.43------------ >
--------------
when the face amount will be payable without interest.
They will be issued in
bearer form only, and in denominations of $1,000, $5,000, $10,000, $100,000,
$500,000, and $1,000,000 (maturity value).
*
Tenders will be received at Federal Reserve hanks and Branches up to the
war
closing hour, two o lclock p. m., Eastern StoasotesxA time,
I
Friday, October 9r
W
Tenders will not be received at the Treasury Department, Washington.
Each tender
must be for an even multiple of $1,000, and the price offered must be expressed
on the basis of 100, with not more than three decimals, e. g., 99.925.
may not be used.
Fractions
It is urged, that tenders be made on the pointed forms and for
warded in the special envelopes which will be supplied by Federal Reserve Banks
or Branches on application therefor.
Tenders will be received without deposit from incorporated banks and
trust companies and from responsible and recognized dealers in investment securi
ties.
Tenders from others must be accompanied by payment of 10 percent of the
^
face amount of Treasury bills applied for, unless the tenders are accompanied by
an express guaranty of payment by a.n incorporated bank or trust company.
Immediately after the closing hour, tenders will be opened at the Federal
T R E A S U R Y D E P A RTMENT
Washington
F O R RELEASE, MORNING- NEWSPAPERS,
Wednesday, O c t o b e r 7, 19^2.
1 *0/ 6 7 ^
The S e c r e t a r y of the Treasury,
v i tes tenders for | ^ 0 0 , 000,000,
bills,
'
-------
—
-------------
by this public notice,
or thereabouts,
in
of 9 1 - ^ a y T r e a s u r y
to be issued on a d i s c o u n t basis u n d e r comp e t i t i v e bidding.
T h e b i lls of this series wil l be dated O c t o b e r 1^,
19^2,
and will
m a t u r e J a n u a r y 13,
19^3»
w h e n the face amount will be payable
wi t h o u t interest.
T h e y will be Issu e d in b e a r e r form only,
and
in d e n o m i n a t i o n s of # 1 , 0 0 0 , # 5 *0 0 0 , # 1 0 , 0 0 0 , # 1 0 0 ,0 0 0 , # 5 0 0 ,0 0 0 ,
and # 1 ,0 0 0 ,0 0 0
(maturity value).
T e n d e r s will be r e c e i v e d at Federal R e s e r v e Banks and
Br a n c h e s up to the c l o s i n g hour, two o 1c l o c k p.m., E a s t e r n w ar
time, Friday, O c t o b e r 9» 19^2.
T e n d e r s wil l not be r e c e i v e d at
the T r e a s u r y Department, W a s h i n g t o n .
E a c h t e n d e r must be f or an
even m u l t i p l e of # 1 ,0 0 0 , and the p r i c e o f f e r e d mus t be e x p ressed
on the b a s i s of 1 0 0 , w i t h not more t han three decimals, e, g.,
99.925«
Fra c t i o n s m a y not be used,
It is u r g e d that tenders be
mad e on the p r i n t e d forms a n d f o r w a r d e d in the special envelopes
w h i c h will be s u p p l i e d by F e d e r a l R e s e r v e B a nks or Branches on
a p p l i c a t i o n therefor.
T e n d e r s will be r e c e i v e d without deposit f r o m Inco r p o r a t e d
banks and trust co m p a n i e s and from r e s p o n s i b l e a nd r e c o g n i z e d
d e alers in Investment securities.
T e n d e r s fro m others must be
a c c o m p a n i e d b y payment of 1 0 percent of the face amount of
T r e a s u r y bills a p p l i e d for, u n l e s s the tenders are a c c o m p a n i e d by
an express gu a r a n t y of p a yment b y an I n c o r p o r a t e d b a n k or trust
company.
I m m e d i a t e l y after the c l o s i n g hour, tenders wil l be opened
at the F e deral R e s e r v e Banks and Branches, f o l l o w i n g w h i c h public
a n n o u ncement will be m ade b y the S e c r e t a r y of the T r e a s u r y of the
amount and price range of a c c e p t e d bids.
T h o s e s u b m i t t i n g tenders
will be a d vised of the a c c e p t a n c e or r e j e c t i o n thereof.
The
S e c r e t a r y of the T r e a s u r y e x p r e s s l y r e s e r v e s the right to accept
or reject any or all tenders, in w h ole or in part, and his acti o n
in any suo h respect shall be final.
P a y m e n t of a c c e p t e d tenders
at the p r ices o f f e r e d m ust be m ade or c o m p l e t e d at the
Federal
R e s e r v e B a n k in cash or o t h e r Imme d i a t e l y ava i l a b l e funds on
O c t o b e r l 1!, 19^2.
33-51
(over )
T h e Income d e r i v e d f r o m T r e a s u r y bills, w h e t h e r interest or
g ain f r o m the sale or o t h e r d i s p o s i t i o n of the bills, shall not
h a v e any exemption, as such, and loss f r o m t h e éale o r o t her dis
p o s i t i o n of T r e a s u r y bills shall not h a v e any special treatment
as such, u n d e r Fe d e r a l t a x Act s n o w o r h e r e a f t e r enacted.
The #
b i l l s shall be subject to estate, inheritance, gift, or other
e x c i s e ’taxés, w h e t h e r F e d e r a l or State, b ut shall be exempt from
all t a x ation n o w or h e r e a f t e r i m p o s e d on the p r i n c i p a l or inter
est t h e reof b y any State, Or any of the p o s s e s s i o n s of the United
States, or by any local t a x i n g authority.
F o r pu r p o s e s of taxa
tion the amount of d i s c o u n t at w h i c h T r e a s u r y b i lls are originally I
sold by the U n i t e d States shall be c o n s i d e r e d to be interest*
U n d e r Sec t i o n s 4*2 and 117 (a) ( 1 ) of the I n t e r n a l R e v e n u e Code
as a m e n d e d b y S e c t i o n 1 1 5 of the R e v e n u e A c t of 1 9 ^ 1 * the amount
of d i s count at w h i c h bills i s s u e d h e r e u n d e r a r e ' s o l d shall not be
c o n s i d e r e d to a o c r u e u n t i l s u c h b i l l s shall be sold, r e d e e m e d or
o t h e r w i s e d i s p o s e d of, a nd such b i l l s are e x c l u d e d from¿considera
tion as capital assets.
Accordingly, the o w n e r of T r e a s u r y bills
(oth e r t h a n life i n s u r a n c e c o m p a n i e s ) i s s u e d h e r e u n d e r need in
clude- iri his i n c o m e t a x ' r e turn o n l y the d i f f e r e n c e b e t w e e n the
p r i c e p a i d f o r s u c h bills, w h e t h e r on o r i g i n a l issue or on subsequent purchase, a n d t he amount a c t u a l l y r e c e i v e d - e i t h e r upon
sale or r e d e m p t i o n at m a t u r i t y d u r i n g t h e t a x able y e a r f or which 1
the r e t u r n là made, as o r d i n a r y g a i n or loss.
T r e a s u r y D e p a r t m e n t C i r c u l a r No*
as amended, arid this
notice, p r e s c r i b e the terms of the T r e a s u r y b i lls and g o vern the
c o n d i t i o n s of t h e i r issue.
C o pies of the c i r c u l a r m a y be o b
t a i n e d f r o m any F e d e r a l R e s e r v e B a n k o r Branch.
1
-0 O 0 - •
<
i
<
-
33-
•rlBring the past week the Congress and
the President have taken drastic action to control
one phase of the Inflation problem — rising wage
rates and fax® prices. If the new bill is to be
fully successful, it must be supplemented by equally
drastic action dealing with the growing disparity
between incomes available for spending and the supply
of goods and services available for purchase. This
disparity can be reduced or eliminated by greatly
increased taxation. In deciding what taxes to use
for this purpose we must never lose sight of the
fact that one of the major functions of taxation
Is to distribute an Inevitable burden more equitably
than Inflation would distribute it. We must direct
our energies to the construction of a tax system
that is at once severe enough to prevent excess
purchasing power from breaking price ceilings and
sensitive enough to allow for individual needs and
abilities. The construction of a tax system that
in this sense combines adequacy with equity will be
a major contribution to the successful prosecution
of the war and to a satisfactory readjustment after
the war.
■*** 32 *»
It can bring pressure to bear Where pressure is
needed. It can force substantial reductions in con
sumption by persons whos&iving standards can stand
such reductions without at the same time putting a
crushing burden on the persons whose living standards
are low* The spendings tax therefore combines
equity with real inflation control.
Conclusion
I have been discussing a few of the many
taxes that might be used to avoid inflation. The
evils of inflation are widely recognized. Nonethe
less, continued and accelerated Inflation remains
a very real threat. Disagreement about the proper
course of action combines with inertia and wishful
thinking to produce inaction. There is no more
urgent and pressing need today than the need for a
widespread understanding of the dangers of inflation,
of the factors that are responsible for this danger,
and of the factors that must be taken into account
in developing a program to avoid inflation.
During the
, «* 3X m
_
_
_
'
'
’
•
"
►
A
,\
spendingastream. It can no longer contribute to
inflation.
The spendings tax has been compared with
a saxes tax. Such a comparison is dangerously mis
leading. To say that the spendings tax and the
sales tax are equally capable of dealing with in
nation because both are levied on consumer expendi
tures is equivalent to saying that a destroyer and
a canoe are squally capable of dealing with a hubmarine because both float on water. fThe spendings
tax is a strong and powerful Instrument capable of
dealing with the dangers of inflation. It has all
of the virtues of the sales tax and none of its
defects. The sales tax, on the other hand, is
completely inadequate as an instrument of inflation
control. It does not reach the magnitudes of our
problem.
The spendings tax is more powerful as
an inflation curb than the sales tax because it
can be made selective in its impact. By granting
exemptions and by being levied at progressive rates
4 4*
- 30 -
the war — and for this period only — with a
spendings tax of the type recently proposed by the
Treasury. Such a spendings tax is designed to
exert pressure at those points where the income tax
cannot do so. In conjunction with the income tax it
provides a flexible and adaptable tax mechanism.
The spendings tax would be levied on the
amount that individuals spend on consumer goods
and services. It would provide for the complete
exemption of individuals whose spendings are below
specified amounts. It would be levied attpMgressive
rates on spendings above these amounts. Because
it is levied on spendingsrather than Income, it
would give relief to persons who are devoting a large
part of their Income to the repayment of debt, pay
ment of life insurance premiums, the purchase of
war bonds and other forms of saving. Because savings
in_any_form are exempt from the tax, the spendings
taxQglveylndividuals an incentive to save rather
than to spend. The money which Is saved is not
taken as tax revenue but it Is removed from the
spendings
- 29 -
The spendings tax
The net Income — not the group Incone
tax coses closest to satisfying the teste I have
set forth* It should, therefore, remain our major
reliance for war finance. At the tea© time, if
the income tax is increased rapidly, a point is
reached beyond which further increases run counter
to some of the tests of sound taxation. Under
present conditions it Is difficult to increase the
individual income tax as much as is necessary un
less allowance is made for fixed commitments to
repay debts, to pay life insurance premiums, and to
make regular savings — forms of expenditures that
exert no inflationary' pressure. Further the income
tax operates exclusively through withdrawing pur
chasing poser; it does not encourage individuals
to use the money that remains for saving rather
than spending.
These shortcomings can be overcome by
supplementing the income tax for the curation of
the war
—
28
«
the taxpayer on an actual pay-as-you-go basis. In
fact, the annual adjustment for the previous year’s
payments means that taxes of persons with fluctuating
incomes will be even further out of step with income
/'
than they are at present, 'Treasury studies using the
incomes of selected taxpayers over a 10-year period
shew that in every case taxes would have fluctuated
more— would have been further out of step with incomeunder the Rural plan than under the present payment
method.
The objective of putting the income tax on
a current basis is an admirable one and deserves
hearty support. The sound way to accomplish this
objective is to collect as much as possible at the
source— that is, to withhold at least the basic part
of the tax from wages, salaries, and dividends at the
time they are paid. That is a truly pay-as-you-go
method.
- 27 -
with an Income of half a million dollars would save
a tax liability of mere than ¡5350,000»
'.That kind of morale would our workers have
If they saw such a bounty going to the wealthy? How
would those whose Incomes had remained stationary,
or even fallen In 1941, react to a tax plan which
specially favored those whose incomes had been ab
normally high that year? And, most important, how
would the morale of our fighting sen be affected by
a plan which would cancel billions of dollars of tax
liabilities in the midst of a cruel and costly war?
Ironically, the Ruml plan fall3 to accomplish
Its avowed objective, namely, to put the taxpayer on
a current basis. This failure arises from the neces
sity of adjusting annually the tax paid during the
preceding year to take account of year-to-year In
come variations. If a taxpayer's 1943 Income Is
$3,000 while his 1942 Income was $10,000, he will
currently have to pay a $10,000-level tax out of a
$3,000 income; or if it is the other say around, he
will pay a $3,000-level tax out of a $10,000 Income.
Changing the label on the tax has certainly not put
'* **•'*
the taxpayer
j1
In effect, the Ruml plan requires two
returns and two sets of computations to determine
one year's tax. This will confuse the taxpayer,
and put added burdens on him without producing any
added revenue, This sight be tolerable if the Rural
plan were fair, and if It accomplished the highly
desirable objective of putting taxpayers on a currant
basis. The basic objections to the plan are that it
is not fair and that It does not accomplish its
avowed objective.
I
The forgiveness of 1941 tax liabilities grantsj
a windfall gain to anyone who had an unusually high
]
income in 1941. A person with a normal income of
$3,000 who received $10,000 in 1941 would immediately
escape the tax on the added $7,000. Eventually— when
he ceased to have any taxable income— he would escape
the tax on the original $3,000. The Ruml plan confers
the greatest benefit on those with the biggest incomes,
Between 80 and 90 percent of taxpayers have incomes
below $3,000, In their cases the amount of tax for
given would vary from a few dollars to a maximum of
two or three hundred dollars. But the wealthy man
with an
• as a moans or putting Income taxpayers an a current
Is tlie Ruml plan. Tills plan lias been called
the skip—a-year plan and the pay-as-you-go plan.
It does skip a year, it Is not truly a "pay as you
go” plan. The Rural plan skips a year by changing
labels. The Income tax you pay this year no® bears
the label, "tax on 1941 income.* Mr. Rural should
change that label to "tentative tax on 1942 Income."
In other words, he would forgive the 1941 tax en
tirely and-fteat the payments you make this year as
cirrent payments on your 1942 income. But that is
not all. ifhen March, 1943, comes around, you would
have to file a return showing your actual 1942 Income.
If that is higher or lower than your 1941 income— and
It will rarely be the same——you would either pay an
additional tax or claim a refund. 3o far, the tax
computations have all been at existing rates and
oxe.opt.tona.
The next step Is to compute a tentative
tax for 1943. To do this, you would apply to your
1942 income the higher rates and lower exemptions In
the new tax bill. That tentative tax would than be
adjusted la March, 1944, on the basis of actual 1943
Income,
In effect,
- 2ii -
the elimination of collection at source of the net
income tax. The Committee, while acceptinc the basic
principle of collection at source, restricted its
application to tho 5 percent gross income tax. The
1342 Revenue Act is still in process, and I hope that
in its final form it will provide for collection at
source of the net income tax— the most important part
of our individual income tax structure.
The House Bill provided for collection at
source at a rate of 5 percent in 1943 and of 10
percent thereafter in order to ease the problem of
transition to collection at source. For individuals
who have not made advance provision for their Income
tax, a transition problem arises in attempting to put
the income tax on a current collection basis. Such
individuals are faced with tho necessity of paying
their last year’s tax and at the same time paying part
of the tax on their current income. Perhaps the best
way to overcome this difficulty is to make the transit®
gradual as was provided in the House Bill.
The Rual Plan
Another method which has been advanced as
a means
percent in 1943 and 10 percent thereafter* The
amount of tax collected at source would have been
based not on the gross amount of wages but only on
that part which was in excess of personal exemptions
and credits. For dividends and interest, it would
have been based on the gross amount paid. However,
the Treasury has since recommended the exemption of
Interest from withholding because withholding on this
type of income involves special administrative and
compliance problems for only a minor amount of revenue.
I This system of collection at source would
not láve been an additional tax. It would have been
simply a means of easing the payment of the regular
income tax. The amounts withheld would have been
credited against the tax liability reported on the
income tax return filed March 15th. Where collections
at source exceeded final tax liability, prompt refunds
would have been made.
The Senate Finance Committee initially
approved the collectlon-at-saurce provisions adopted
by the House. More recently/ however, in endorsing
a 5 percent tax on gross income in excess of $634,
the Senate Finance Committee decided to recommend
the elimination
-
22 -
be an aid to the taxpayer. But it is such more.
It permits the income tax to be a tpuly effective
instrument for Inflation control. Through collec
tion at source tho income stream can be tapped as it
flows into the hands of individuals before they have
had a chance to spend the money. Through collection
at source, tax rates can be changed and the change
can be made effective almost immediately, since it
will ease the burden of tax payment, collection at
source can make possible the imposition of much
heavier taxes than would otherwise be tolerable.
These conclusions are strongly supported by the
experience of other countries which have found
collection at source an Indispensable part of a
strong and vigorous individual income tax. Great
Britain, Canada, and Australia— to mention only a
few examples— have found it essential to make col
lection at source an integral part of their tax
system.
As passed by the House, the 1942 Revenue
Bill provided for the collection of tax at source
from wages, dividends, and Interest at a rate of 5
percent
-
21 -
part be eliminated by the introduction of collection
at the source. It is for this reason, among others,
that the Treasury has so strongly urged that collection
at source be used in connection with the regular net
income tax.
The existing method of collecting the income
tax was reasonably adequate '»hen the income tax was
essentially a rich man's tax, »hen it was imposed at
relatively moderate rates, and when we could do our
national planning in term of years rather than months.
Conditions of this sort no longer prevail. The income
tax is no® biting harder and deeper than ever before.
With over 30 million people filing returns in 1943,
it will be truly a mass tax. As such it must be
adapted to the needs of the great bulk of »age earners
and other recipients of small incomes who are accustomed
to budgeting on a weekly, or monthly, rather than on
a yearly basis. The best way to this— and thereby
to minimize hardship for taxpayers and cut down delin
quency— is to provide for the deduction of income taxes
currently from pay envelopes and from dividend checks,
Collection at the source will therefore
bo an
-
20
-
The individual net income tax and
at source ...
(
Th© tax on which we have so far placed
major reliance in tapping the income of individuals
is the individual net income tax. This tax should
continue to be our major reliance, it meets most of
the relevant criteria, and has few of th© defects of
other suggested taxes. The individual income tax can
distribute the burden equitably, since it provides
exemptions and is levied at progressive rates. The
tax is based on net Income— ths fairest known measure
of individual ability to pay taxes. Because it is
progressive, and can therefore be adjusted to indivi
dual needs, it is capable of almost indefinite ex
pansion as our revenue requirements increase.
In one important respect, however, the
individual Income tax in its present form is inadequate.
As it is now collected the income tax is payable only
in the year following the year in which the income is
received. In consequence, the income tax is not
quickly responsive to changes in the national income
or to changes in tax rates. This defect can in large
part
-
19
-
The administrative difficulties of a tax
on the increased income of individuals would alone
be sufficient to eliminate it as a practicable
possibility* Such a tax would introduce into every
individual income tax return most of the complex!—
ties that have been so troublesome in connection
with the excess profits tax on corporations.
Determinations of prewar base period Income with
complicated adjustments analogous to those in the
corporation excess profits tax would have to be
made for literally tens of millions of returns.
18 been less. He would be likely to reply that he was
less able to pay the tax now than the other man
-
because he had gone through the previous years with
such leas margin, I know no answer to this argument.
some ways, an even more basic objection
to the tax on the Increased Incomes of individuals
is that it fails to recognize one of the basic
In
physical realities I have stressed. We must give
increased incomes and increased amounts of goods and
services to persons who have not heretofore been
employed, but who are now being asked to work in
order that we say produce the armaments m so
desperately need. Se must likewise give increased
incomes to Individuals who are being asked to work
longer and harder and at different tasks, Se shall
be defeating our own ends if we give these persons
increased incomes with one hm d and take back the
Increases with the other in the form of a special
tax* The fixed Income groups cannot, in short, be
protected from a decline in their standard of
living.
The administrative
17 A tax on the Increased Income
61' lndlViduale11
Another tax that has frequently been pro
posed as a means of combating Inflation Is a tax
on the increased Incomes of Individuals. Such a
tax has delusive charm — particularly to those of
us who are in the fixed Income groups and who can
not avoid some feeling of discrimination at the
spectacle of many of our fellow citizens receiving
greatly increased incomes while our own incomes are
r«naming stationary.
A tax on the increased income of individuals
would, however, introduce many elements of unfairness,. It would mean that two persons receiving, say,
$4,000 a year would pay far different amounts of
tax because one had been receiving $]j,000 a year
regularly while the other had received only $2,000
in earlier years. I do not want to be the person
who has the job of telling the $2,000 man that he must
now pay more taxes than the $4,000 man even though
their Incomes are the same, because his had formerly
been less.
—
16
—
the same way as a flat 10 percent retail sales tax.
There is a difference in name, yes, — but what is
the difference in substance? Equity aside, the simple
fact is that the sales tax is not big enough to do
the job that must be done. It is too crude an in
strument, The sales tax does not discriminate be
tween persons who can reduce their purchases sub
stantially and persons who cannot. It is impossible
to impose a sales tax at sufficiently high rates to
curtail the consumption of persons whose living
standards are liberal without at the same time
levying an intolerable burden on tens of millions
of our people. If it is imposed at low rates, the
sales tax exercises little or no restraining influence
on the persons who are in the best position to re
duce their standards of living. Taxes can be
sufficiently drastic to deal with an inflation
problem of large dimensions only if they are care
fully geared to the needs of the taxpayers, only
if they recognize differences in tax-paying ability.
Another
/
15 the war* It falls most heavily on persons with the
lowest standards of living, and least heavily on
-
persons with literal standards of living. The Inci
dence of the sales tax Is very similar to the
incidence of inflation itself. From the point of
view of the consumer there is little to choose be
tween a 10 percent rise In price occasioned by the
imposition of a sales tax and a 10 percent inflationary
rise in price.
The sales tax shows how opinions can be
influenced by nomenclature. Powell once said of
Judges that they "are not always persuaded that a
rose by any other name would smell as sweet, and
their noses are sometimes led by names rather than
by substance." Judges are not the only sinners.
It would be fantastic to suggest an income tax with
out exemptions at a rate of 10 percent on a $500
income, at a rate of 6 percent on a $2,500 income,
and at a rate of 5 percent on a $10,000 income.
Yet such a proposal would distribute the burden in
the same
\
-
lli 1%:
The Retail Sales Tax v \
.a
The retail sales tax has been widely
proposed as a means of reaching the whole populace
and of tapping mass purchasing power* The retail
sales tax has two advantages which explain much of
the support it has received. In the first place,
the sales tax is levied directly on consumer spend
ing, and hence has a tendency to discourage such
spending. In the second place, the sales tax with
draws money currently as it is spent and involves
no lag between the imposition and payment of the
tax. These advantages are, however, more than
offset by the serious disadvantages. On net balance,
the sales tax fails miserably to meet the hard tests
I have enumerated. The sales tax would lead to an
extremely inequitable
distribution of the cost of
1 7
the war
raise no serious problems of tax compliance, and
they should impose as little a drain as possible
on scarce men and machines.
5* Additional taxes should recognize
the necessity of facilitating a gradual adjust
ment of commitments undertaken at lower tax levels
to pay debts, purchase insurance, and make regular
savings.
These criteria furnish a basis for
judging the adequacy of various suggested methods
of .modifying our tax system to meet war-time needs.
I shall turn first to the retail sales tax.
12
interfere as little as possible with the incentive
’d
■ C' '
of individuals to work, to work longer, and to werk
*
more efficiently.
2. Taxes must operate to withdraw purchasing
power from the hands of consumers. They must be
capable of withdrawing purchasing power currently as
It is received and they must be capable of rapid ad
justment to meet changes in the economic situation,
insofar as is practicable they should actually dis
courage consumer spending, since the pressure of incom/ onprices and the cost of living results from
the effort to use purchasing power, foreover, taxes
should not make more difficult the exercise of direct
price control, rationing, and other methods of in
flation control.
3. Taxes must be capable of sufficient ex- 1
pansion in scope to meet the growing problem of excess
purchasing power and to be adaptable to future war
and post-war needs.
4. Taxes should be reasonably capable of
administration in the light of their Importance as
anti-inflationary and revenue measures. They should
raise
11
1, The burden of taxes and the pressure
they exert should be very light on the Billions
whose standard of living is inadequate to support
productive efficiency. The burden should increase
as the standard of living rises so that the pressure
should be greatest on those elements of spending
which are least necessary to the individual and to
the war effort. This objective is often viewed as
a task to be undertaken only if it is not too diffi
cult, and to be avoided at the slightest provocation.
Such an attitude reflects a serious misconception of
the functions of taxation. As I have suggested, one
of the major reasons for accepting taxation instead of
inflation is precisely to enable ourselves to dis
tribute the cost of the war sore equitably.
Moreover, sore than fairness or equity is
involved. We shall lose much more than we gain if
we so reduce the standard of living of our less
fortunate citizens as to impair their morale and
productive efficiency. If taxes are to promote,
i
rather than hinder, our transition to maximum war
production, they must conserve efficiency; they must
interfere
10
The criteria of adequate taxes
w
Administrative price fixing and ceilings
* ^*'
>
imposed from above, though accepted by a willing and
cooperative public, can solve only part of our entire
problem. They absorb neither increased spending power
nor the purchasing power released by the reduction in
available consumer goods, we do have at our command
the means of keeping excess purchasing power away fros
the market, fe can see to it that the inevitable re
duction in consumption is put on those who are in the
best position to bear it. This can be-done through
taxation which, when exercised wisely and efficiently,
is one of the most flexible and effective curbs on
inflation. Taxes have little or no effect on the real
physical cost of the war. Their function is to distri
bute this cost, and to adjust the monetary situation
to the real situation. However, taxes can accomplish
this function, and can be adapted to the economic
realities of the day, only if they satisfy certain
acid tests.
It can hardly fall to be worth while to
state these tests candidly and without equivocation,
1, The burden
mm
í~ j¡¡
mm
dispossessing some classes in the community at the
expense of other classes, inflation will give rise
to bitterness and dissatisfaction in the post-war
period. Post-war recovery will need a happier
setting.
This description of the consequences of
inflation is not simply a horror story from Grimm's
Fairy Tales, Nor does it involve imaginary projection
into the future of hypothetical events. History,
the best teacher of all, has its lesson. Our experi
ence during the last war with a mild inflation
resulting from much weaker pressure than is now
operative — and, even more, the experience of many
of the European belligerents — provide realistic
case histories of the origins and the effects of
inflation.
is that
or inflation
l t T^ s n e X t
organises the economic process. Busi
ness is conducted in tenr,s of prices that
to be fairly stable. D .
that are expected
the
u
* 8P/*Q price Increases shift
emphasis from production as a
to
10n as a 0our<* Of profits
P ulation and hoarding as soiirwo ,
The struggle
M »,. i of labor tn '
of profits,
t keep ^see m line with th*
rising prices adds to th*
6
to the confusion, or shall we
say, chaos?
rr
we
nrrtH .
^nation takes precedence over
Production as the princimn „
labor «,
°f bU8lnes^ and
nation
i L00klne
lnt° thelegacydl8ttot
flation leaves
a post-war
th**,,*■*»». in
return to a period
„„
Prosperous peace far more
«L ™ T ;
»lth a
o.bt 7
—
a
^ "UltIPly,”E * * * “ «•" « *
lMV’ ^
"anr tlMC M
of
« tne
1 Sa™ * !acur
«vent.
Process l„fiat,on
Z
By „is
eeve a price system that is incapable of meetlny
Post-war strains a nr-t^
,
meeting
are entirely
of i
*"*"
,n prlMj>
*MCh — ^ « «
•IT out
out 'of
i,„e wth
other
dispossessing
7
purchase of goods and services. Rising prices,
therefore, affect them in exactly the same manner
as a flat rate gross income tax without exemptions.
And many of them cannot recoup any of the loss
through getting higher incomes. Persons with rela
tively high fixed incomes are affected much less
adversely. Their incomes ordinarily leave a substantial
margin for saving — a margin that can cushion the
impact of the rising prices.
The sad story of inflation does not end
here. Inflation has a disastrous effect on capital
values. Savings accumulated in the hope of providing
a competence for old age become worthless. Retire
ment pensions fixed in dollar amounts lose their
value. Persons who happen to have their funds in
vested in capital assets that rise in price benefit
at the expense of persons who have their funds in
vested in Government bonds, or in other assets whose
value is fixed in dollar terms. Consequently, in
addition to distributing the inevitable current
burden very badly, inflation adds new burdens of
its own.
The next
-
6-
inflation of tomorrow. We may as well recognize
that individuals will not of their own choice save
close to half of the income that is available for
spending or saving. They are human beings and they
will inevitably try to spend more than the value at
present prices, of the goods and services that will
be available. I f consumer incomes are not withdrawn
by taxes and borrowing, they will flow to the
market in a stream that will break the dam of price
control and rationing. When a dam breaks, the floods
are not far away.
If we permit uncontrolled inflation to
occur, we shall be choosing by default a method of
distributing the real cost of the war that we would
not think of choosing by design. Rising prices
will distribute the cost of the war in a haphazard
and inequitable way. Any method will bear heavily
on persons with fixed incomes. But inflation would
do much more. It would hit with special force those
fixed income recipients ifoose incomes are the lowest,
since they must spend their entire income on the
purchase
5
We should not delude ourselves into thinking
that we have complete freedom In the distribution
of this real cost of the war. le must compensate
individuals who are working when they have not
previously been working or who are working longer
or «10 have changed from positions in the civilian
economy to positions in the war economy. Ve can
compensate them out of a diminishing supply of goods
and services only through the sacrifices of others,
who for one reason or another are not being asked,
or are not able, to work harder, longer,or in a new
capacity. These persons, often described as the
fixed income group, have no choice. No financial
legerdemain, no tax panaceas, no verbal evasions,
can protect the whole of the fixed income group
from a larger than proportionate diminution of
their standard of living.
The alternative of inflation
If we do nothing, the physical realities
of today will inevitably develop into a disastrous
inflation
-
a t
p resen t
w ill
p r ic e s ,
le a v e
m a g n itu d e
saved
by
a
m in im u m
m ust
be
a
c o n v e n tio n a l
p r o b le m
Is
to
n ext
w o rk
s m a lle r
rew ard
u s
p h y s ic a l
fo r
fa c ts .-
m easu res
w ill
th e
one
s e r v ic e s
on
c iv ilia n s
th e
and
r * *
s m a lle r
o th e r
in e s c a p a b le
//
e x h a u s tio n
a
pay
w ar
to
hand
w in
e c o n o m ic
j
,
w ill
goods
o f
to
w ar.
to
a
h ard
by
e c o n o m ic
C iv ilia n
p la n te d .
c a p ita l,
goods
th e
They
th e
are
o b scu red
w ere
o f
have
s e r v ic e s
be
ou r
have
be
p ic tu r e .
of
b a s ic
T h ese
c o n s titu te
co st
th e
In
w ill
o th e r
s u p p ly
th e
c e ilin g s .
us
e x e r tio n s .
n or
th is
v fr ia t w i l l
T h ere
cannot
o f
v o lu n ta r ily
We s h a l l
and
T h is
p r o b le m
o f
y e a r.
b a s ic
w h ere
th e
th e
m u st
th e
gro w
and
hand,
M o re
goods
ta x e s
o r
p r ic e
H o w ever,
N e c e s s itie s
change
n ot
H ard er w o rk
g re a te r
N e ith e r
can
on
in te n s iv e ly .
con su m er
our
te r m in o lo g y .
goods
o f
th is
su m
ta x e s
in fla tio n
te rm s.
th a n
m o re
In
A
e ffe c tiv e ly
fu n d a m e n ta l.
and
s u p p ly
ta k e n
th e
b illio n .
b illio n .
p ressu re
sta te d
y ea r
$70
th a n
red u ce
m o n e ta ry
m o re
lo n g e r
be
to
•
$50
or
r u in o u s
1have
-
m o re
e ith e r
co n su m ers
o th e r w is e
w o rk
a t
k
on
and
p r ic e
c o n s titu te
w ar.
lie
s h o u ld
reso u rces
can
w ar
o u tp u t.
th e
d iv e r s io n
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even
and
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la r g e
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have
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we
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have
now
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com e
th e
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com e
u sed
and
to
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to
p ro d u ce
lu x u r ie s ,
regard
s a c r ific e d
fro m
fo r
as
and
n e c e s s i
p la n e s ,
ta n k s,
gu n s.
T h is
p r o b le m
w age
are
w ill
ra te s
ta k e n ,
goods
u n s o lv e d
n ot
and
be
o f
r is in g
m u st m ean
n e ig h b o r h o o d
o f
con su m er
r u n n in g
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le a s t
flo w
in
th e
o f
o f
are
b illio n
con su m er
m ost
goods
and
bound
in
goods
o p tim is tic
goods
$ 115
and
a
do
o f
n ot
are
on
a
bound
th e
to
e s tim a te
s e r v ic e s
flo w
d u r in g
o f
p r ic e s .
y e a r,
is
a
and
a
le v e l
sam e
tim e
d ecrea se.
th e
th e
y e a r.
o f
a t
th e
E ven
a v a ila b le
19& 5,
a t
r u n n in g
c u r r e n tly
b illio n
to
o f
ste p s
c u r r e n tly
$80
r is e
A t
fir m
d im in is h in g
s e r v ic e s
IJhJ*
is
s ta b iliz a tio n
b illio n
to
in fla tio n
U n le s s
in d iv id u a ls
o f
th e
p ressu re
n e ig h b o r h o o d
p a y m e n ts
$ 12 0
s u p p ly
to
th e
and
in c r e a s in g
in
flo w
by
o f
p r ic e s .
In co m es
p a y m e n ts
th e
a sp ect
s o lv e d
fa rm
In co m e
th e
p a rt
p a rt
N o n - e s s e n tia ls
th in g s
w ill
o n ly
reso u rces
good s.
som e
t ie s ,
fu r n is h
v a lu e d
p resen t
,|
A t
segm en t
us
to
th e
of
th e
th e
o f
w age
ra te s
th e y
m u st
th a t
th e
and
and
an
th e
o f
e m p lo y e d
have
to
u p -g ra d ed
a
lo w
m o re
p la n ts
to
be
ra te s
and
jo b
m o re
~
h o u rs*
tra n s fe rre d
o f
s k ill
e q u ip m e n t
n ot
in to
are
th e
n ot
th e
san e
s u p p ly
a v a ila b le .
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undone.
o f
our
of
w om en
w ill
w ill
b e in g
e ffo rt*
s id e
as
p r o b le m
in c r e a s e d
in to
have
have
to
w ill
to
be
r e q u ir in g
to
p o s itio n s
B u s in e s s
u sed
w ill
have
C o n sta n t
w age
c o n sta n t
fe w e r
in c o m e
e m p lo y e d
a b ilit ie s .
th in g
as
in c o m e s
W o rkers
w ar
—
p r o d u c tiv e
now
now
th o u g h
On t h e
e ffic ie n c y
th e ir
n ot
in fla tio n
fro m , p o s i t i o n s
u tiliz in g
b lin d ,
and
E ven
P erso n s
and
th is
le g is la tio n *
flo w
M ore
n o t
c o n tr o lle d
re ce n t
la r g e r
on
se g m e n t,
s e r io u s
r e m a in s
a
a
are
u tilis a tio n
b ro u gh t
be
th e
s h o u ld
p r o b le m *
In d u stry *
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w ill
o n ly
co n su m ers*
d egree
fu lly
is
a
by
m ean
in
w o rk
p r o b le m
be
la r g e
w ill
c o n c e n tr a tio n
p r ic e s
w ill
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be
i t
fa rm
In creased
hands
tim e
I n fla tio n
u n to u c h e d
A
s id e
sam e
in fla tio n
fa c t
w h o le
r e m a in s
th e
in c o m e s *
con su m er
goods
u tiliz a tio n
o f
reso u rces
The
th e
P r e s i d e n t 's
la tio n
o f
recen t
has
req u est
fo c u se d
c o n tr o llin g
o f
and
c r e a tio n
E c o n o m ic
and
in to
an
c o n tro l
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a
th e
ven t
ou t
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of
w ill
in
fa rm
th a t
m easu res
hand.
of
ta k e n
th e
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by
w o u ld
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to
an
m ean
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be
a c tio n
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e a s ily
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enough
fa ra
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w ages
and
p erso n al
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in c r e a s e s
in
T h is
th e
fa m ilia r
w ages
u p w ard
and
in
tu rn
o f
w ill
in
co n vert
u s.
to
p r ic e s
p erso n al
s p ir a l
I t
u n c o n tr o lle d
and
w h ic h
fa r -
r is e s
ra te s
p r ic e s ,
th e
s u c c e s s fu l
w age
in c r e a s e d
is
u s.
m any
severe
o f
o f
co n tro v e rsy
and
fo r
p r o b le m
O ffic e
th o se
e x p lo s iv e
le g is
C o n gress
p a rt
th e
m ig h t
over
The
by
th e
th is
p r e v e n tin g
th a t
A ct
o f
T h is
every
th e
p r ic e s .
r e a lm
a c tio n .
to
is
fa ra
upon
C o n tro l
have
a ffe c t
in to
can
and
P r e s id e n t
p r ic e s
d is a s te r , o n ce
o f
o f
in fla tio n
in fla tio n
in fla tio n
O th e r
r e a lm
a n ti-in fla tio n a r y
P r ic e
th e
ou t
in v a lu a b le
and
m ild
by
p r o b le m
r e a c h in g *
.m a k e
Second
c o n tro v e rsy
a tte n tio n
ra te s
S ta b iliz a tio n
in fla tio n
fo r
p u b lic
w age
p assage
th e
th e
C o n g r e s s io n a l
p re
g e t
in c o m e s
le a d
to
in c o m e s .
in fla tio n .
A t
th e
^
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Gbè^ 'X. I ‘f if ')*p
TREASURY DEPARTMENT
Washington•
\ y ^ U ^ 5u-C.
(The following address by Randolph E. Paul, General Counsel of
the Treasury, before the dinner meeting of the American
Statistical Association at the Hotel Woodstock, New York City,
is scheduled for delivery at 8*00 p«m., Eastern War Time.
Wednesday, October 7. 1942. and is for release at that time,)
PRECES, TAXES AND INFIATION
The recent,
Q
3-
TREASURY HEPARlMENT
Washington
For Release, Morning Newspapers
Thursday, October 8, 1942
Press Service
No. 3 3 - 5 2
(The following address by Randolph E. Paul, General Counsel of
the Treasury, before the dinner meeting of the American
Statistical Association at the Hotel Woodstock, New York City,
is scheduled for delivery at 8,00 p.m., Eastern liar Time,
Wednesday, October 7, 1942. and is for release at that time.)
PRICES, TAXES AND INFLATION
The recent Congressional controversy over the President’s request
for ahti-inflationary legislation has focused public attention upon the
problem of controlling wage rates and farm prices. The passage of the
Second Price Control Act by Congress and the creation by the President
of the Office of Economic Stabilization have taken this part of the
inflation problem out of the realm of controversy and into the realm
of action. This action is far-reaching, and will affect every one of
us. It will make an invaluable contribution to the successful control
of inflation by preventing those rises in wages and in farm prices that
might easily convert a mild inflation into an explosive and uncontrolled
inflation that would mean ruin for many of. us. Other, measures can
hardly be severe enough to prevent disaster, once wage rates and farm
prices get out of hand. Increased wages’and personal incomes lead to
increased prices, which in turn lead to further increases in wages and
personal incomes. This is the familiar upward spiral of inflation.
At the same time concentration on this segment of the inflation
problem should not blind us to the fact that it is onfy a segment,
and not the whole of the inflation problem. Even though wage rates
and farm prices are controlled — as they must and will be — a serious
inflation problem remains untouched by the recent legislation.
A large job remains undone. On the income side an increased
utilization of our productive resources wall mean a larger flow of In
comes into the hands of consumers. More women will have to be employed
In industry. Persons now employed will have to work more hours. Workers
will have to be up-graded — «transferred from positions requiring a
low degree of skill and efficiency to positions more fully utilizing
their abilities. Business plants and equipment not now being used will
have to be brought into the war effort. Constant wage rates are not
the same thing as constant incomes.
-
2
-
On the supply side fewer consumer goods -will be available. The
increased utilization of resources can furnish only part of the in
creased war output* A large part will have to come from the diversion
of resources now being used to produce civilian goods. Non-essentials
and luxuries, and even some things we have come to regard as necessi
ties, will have to be sacrificed for planes, tanks, and guns.
This unsolved aspect of the inflation problem will not be solved
by the stabilization of wage- rates and of farm prices. Unless firm
steps are taken, rising incomes and a diminishing flow of goods must
mean increasing pressure on prices. Income payments to individuals
are currently running in the neighborhood of $115 billion a year, and
the flowr of consumer goods and services is currently running in the
neighborhood of $80 billion a year. Income payments are bound to rise
to a level of at least $120 billion in 194-3« At the same time the
flow of consumer goods is bound to decrease. Even the most optimistic
do not estimate the available supply of goods and services during 194-3,
valued at present prices, at more than $70 billion. This will leave
a minimum of $50 billion. A sum of this magnitude must either be
taken in taxes or voluntarily saved by consumers to reduce effectively
what will otherwise be a ruinous pressure on price ceilings.
I have stated the inflation problem in conventional monetary
terms. However, the basic problem is more fundamental. More of us
will have to work next year than this year. We shall have to work
longer and more intensively. There will be a smaller supply of consumer
goods and services to reward üs 'for our greater exertions. These are
hard physical facts. Necessities cannot be obscured by terminólogy5
Neither taxes nor other economic measures can change the basic picture.
Civilian goods will not grow where war goods wete planted. Harder
work and the exhaustion of our c a p i talon the one hand, and a smaller
supply of goods and services on the other hand constitute the price
civilians must pay to win the war. They constitute the inescapable
economic cost of the war'*
- 3lie should not delude ourselves into thinking that we have complete
freedom in the distribution of this real cost of the war. We must
compensate individuals who are working when they have not previously
been working or who are working longer or who have changed from positions
in the civilian economy to positions in the war economy. We can
compensate them out of a diminishing supply of goods and services only
through the sacrifices of others who for one reason or another are not
being asked, or are not. able, to work harder, longer, or in a new
capacity. These persons, often described as the fixed income group,
have^no choice. No financial legerdemain, no tax panaceas, no verbal
evasions, can protect the whole of the fixed income group from a larger
than proportionate diminution of their standard of living.
The alternative of inflation
4
If we do nothing, the physical realities of today will inevitably
develop into a disastrous inflation of tomorrow. We may as.well re
cognize that individuals will not of their own choice save close to
half of the income that is available for spending or saving. They
are human beings and they will inevitably try to spend more than the
value at present prices, of the goods and services that will be
available. If consumer incomes are not withdrawn by taxes and borrow
ing, they will flow to the market in a stream that m i l break the dam
of price control and rationing. When a dam breaks, the floods are not
far awray.
>
If we permit uncontrolled inflation to occur, vre shall be choosing
by default a method of distributing the real cost of the war that we
would not think of choosing by design. Rising prices vill distribute
the cost of the war in a haphazard and inequitable way. Any method
will bear heavily on persons with fixed incomes. But inflation w/ould
do much more. It would hit with special force those fixed income
recipients whose incomes are the lowrest, since they must spend their
entire income on the purchase of goods and services. Rising prices,
therefore, affect them in exactly the same manner as a flat rate
gross income tax without exemptions. And many of them cannot recoup
any of the loss through getting higher incomes. Persons with rela
tively high fixed incomes are affected much less adversely. Their
incomes ordinarily leave a substantial margin for saving — a margin
that can cushion the impact of the rising prices.
«•fe -
The sad story o f inflation does not end here. Inflation has a
disastrous effect on capital values. Savings accumulated in the hope
of providing a competence for old age become worthless. Retirement
pensions fixed in dollar amounts lose their value. Persons who
happen to have their funds invested in capital assets that rise in
price benefit at the expense of persons who have their funds invested
in Government bonds, or in other assets whose value is fixed in dollar
terms. Consequently, in addition to distributing the inevitable current
burden very badly, inflation adds new burdens of its own.
The next chapter in the book of inflation is that it disorganizes
the economic process. Business is conducted in terms of prices that
are expected to be fairly stable. Rapid price increases shift the
emphasis from production as a source of profits to speculation and
hoarding as sources of profits. The struggle of labor to keep wages in
line with the rising prices adds to the confusion, or shall we say,
chaos? If inflation takes precedence over production as the principal
concern of business and labor, the war effort cannot fail to suffer*
Looking into the more distant future, inflation leaves a post-war
legacy that will make the return to a period of prosperous peace far
more difficult. By multiplying the monetary costs of the war, inflation
will leave the Government burdened with a tremendous debt many times as
large as the debt we shall have to incur in any event. By disorganizing
the economic process inflation will leave a price system that is incapable
of meeting post-war strains, a price sj/stem in which some prices are
entirely out of line with other prices. By dispossessing some classes
in the community at the expense of other classes, inflation will give
rise to bitterness and dissatisfaction in the post-war period. Post-war
recovery will need a happier setting.
This description of the consequences of inflation is not simply a
horror story from Grimm*s Fairy Tales, Nor does it involve' imaginary
projection into the future of hypothetical events. History, the best
teacher of all, has its lesson. Our experience during the last war with
a mild inflation resulting from much weaker pressure than is now
operative — and, even more, the experience of many of the European
belligerents — provide realistic case histories of the origins and the
effects of inflation.
It is sometimes helpful to carry coals to Newcastle, I may there
fore add one more thought. Inflation is not simply a threat for the
future. During the twelve months ending August of this year, the cost
of living index of the Bureau of Labor Statistics averaged 11 percent
higher than during the twelve months ending August, I9 I1 I* This repre
sents a price rise more than half as large as the rise in the cost of
living from 1917 to 1918 — the largest rise from one calendar year to
the next in World War I. And this 11 percent price rise occurred
despite direct and far more vigorous price control than we dreamed of
in World War I.
K _
The criteria of adequate taxes
Administrative price fixing and ceilings imposed from above,
though accepted by a willing and cooperative public, can solve only
part of our entire problem. They absorb neither increased spending
power nor the purchasing power released by the reduction in available
consumer goods. We do hate at our command the means of keeping excess
purchasing power away from the market. We can see to it that the
inevitable reduction in consumption is put on those who are in the
best position to bear it. This can be done through taxation v»rhich,
when exercised wisely and efficiently, is one of the most flexible
and effective curbs on inflation. Taxes have little or no effect on
the real physical cost of the war* Tlieir function is to distribute
this cost, and to adjust the monetary situation to the real situation.
However, taxes can accomplish this function, and can be adapted to
the economic realities of the day, only if they satisfy certain acid
tests.
It can hardly fail to be worth while to state these tests candidly
and without equivocation,
1.
The burden of taxes and the pressure they exert should be
very light on the millions Y/hose standard of living is inadequate to
support productive efficiency. The burden should increase as the
standard of living rises so that the pressure should be greatest on
those elements of spending which are least necessary to the individual
and to the Y/ar effort. This objective is often viewed as a task to be
undertaken only if it is not too difficult, and to be avoided at the
slightest provocation. Such aq attitude reflects a serious misconception
of the functions of taxation. As I have suggested, one of the major
reasons for accepting taxation instead of inflation is precisely to
enable ourselves to distribute the cost of the war more equitably.
Moreover, more than fairness or equity is involved. Vie shall lose
much more than we gain if we so reduce the standard of living of our
less fortunate citizens as to impair their morale and productive ef
ficiency. If taxes are to promote, rather than Joinder, our transition
to maximum war production, they must conserve efficiency^ they must
interfere as little as possible with the incentive of individuals to
work, to work longer, and to work more efficiently.
/
- 6 ~
2,
Taxes must operate to withdraw purchasing power from the
hands of consumers. They must be capable of vdihdraYiing purchasing
power currently as it is received and they must be capable of rapid
adjustment to meet changes in the economic situation. Insofar as is
practicable they should actually discourage consumer spending, since
the pressure of income 6n prices and the cost of living results from
the effort to use purchasing power. Moreover, taxes should not make
more difficult the exercise of direct price control, rationing, and
other methods of inflation control.
3* Taxes must be capable of sufficient expansion in scope to
meet the growing problem of excess purchasing power and to be adaptable
to future war and post-war needs.
4-. Taxes should be reasonably capable of administration in the
light of their importance as anti-inflationary and revenue measures.
They should raise no serious problems of tax compliance, and they
should impose as little a drain as possible on scarce men and machines.
3. Additional taxes should recognize the necessity of facilitating
a gradual adjustment of commitments undertaken at lower tax levels to
pay debts, purchase insurance, and make regular savings.
These criteria furnish a ba.sis for judging the adequacy of various
suggested methods of modifying our tax system to meet war-time needs.
I shall turn first to the retail sales tax.
The Retail Sales Tax
The retail sales tax has been widely proposed as a means of
reaching the whole populace and of tapping mass purchasing power.
The retail sales tax has two advantages which explain much of the
support it has received. In the first place, the sales tax is levied
directly on consumer spending, and hence has a tendency to discourage
such spending. In the second place, the sales tax withdraws money
currently as it is spent and involves no lag between the imposition
and payment of the tax. These advantages are, 'however, more than off
set by the serious disadvantages. On net balance^, the sales tax fails
miserably to meet the hard tests I have enumerated* The sales tax
would lead to an extremely inequitable distribution of the cost of
the war• It falls most heavily on persons with the lowest standards
of living, and least heavily on persons with liberal standards of
living. The incidence of the sales tax is very similar to the inci
dence of inflation itself. From the point of view of the consumer
there is little to choose between a 10 percent rise in price occasioned
by the imposition of a sales tax and a 10 percent inflationary rise
in price.
- ? -
The sales tax shows how opinions can be influenced by
nomenclature, Powell once said of judges that they nare not always
persuaded that a rose by any other name would smell as sweet, and
their noses are sometimes led by names rather than by substance.11
Judges are not the only sinners. It would be fantastic to suggest
an income tax without exemptions at a rate of 10 percent of a $500
income, at a rate of 6 percent on a $2,500 income, and at a rate of
3 percent on a $10,000 income. Yet such a proposal would distribute
the burden in the same way as a flat 10 percent retail sales tax.
There is a difference in name, yes, — but what is the difference
in substance? Equity aside, the simple fact is that the sales tax
is not big enough to do the job that must be done. It is too crude
an instrument. The sales tax does not discriminate between persons
who can reduce their purchases substantially and persons who cannot.
It is impossible to impose a sales tax at sufficiently high rates to
curtail the consumption of persons whose living standards are liberal
without at the same time levying an intolerable burden on tens of
millions of our people. If it is imposed at low rates, the sales
tax exercises little or no restraining influence on the persons who
are in the best position to reduce their standards of living. Taxes
can be sufficiently drastic to deal with an inflation problem of
large dimensions only if they are carefully geared to the needs of
the taxpayers, only if' they recognize differences in tax-paying
ability.
A tax on the increased income
of individuals
Another tax that has frequently been proposed as a means of
combating inflation is a tax on the increased incomes of individuals.
Such a tax has delusive charm — particularly to those of us who are
in the fixed income groups and who cannot avoid some feeling of
discrimination at the spectacle of many of our fellow citizens receiv
ing greatly increased incomes while our o?jn incomes are remaining
stationary.
A tax on the increased income of individuals would, however,
introduce many elements of unfairness. It would mean that two persons
receiving, say, $4,000 a year would pay far different amounts of tax
because one had been receiving $4,000 a year regularly while the other
had received only $2,000 in earlier years, I do not want to be the
person who has the job of telling the $2,000 man that he must now pay
more taxes than the $4,000 man even though their incomes are the same,
because his had formerly been less. He would be likely to reply that
he was less able to pay the tax now than the other man because he had
gone through the previous years with much less margin. I know no
answer to this argument.
In some ways, an even more basic objection to the tax on the
increased incomes^of individuals is that it fails to recognize one
of the basic physical realities I have stressed. We must give in
creased incomes and increased amounts of goods and services to
persons who have not heretofore been employed, but who are now being
asked to work in order that we may produce the armaments we so
desperately need. W e must likewise give increased incomes to individuals
who are being asked to' work longer and harder and at different tasks.
W e shall be defeating our own ends if we give these persons increased
incomes with one hand and take back the increases with the other in
the form of a special tax. The fixed income groups cannot, in short,
be protected from a decline in their standard of living.
The administrative difficulties of a tax on the increased income
of individuals would, alone be sufficient to eliminate it as a practicable
possibility. Such a tax would introduce into every individual income
tax return most of the complexities that have been so troublesome in
connection with the excess profits tax on corporations. Determinations
of prewar ba.se period income with complicated adjustments analogous to
those in the corporation excess profits tax would have to be made for
literally tens of millions of returns*
The individual net income tax and
collection at source
^The tax on which we have so far placed major reliance in tapping
the income of individuals is the individual net income tax. This tax
should continue to be our major reliance. •It meets most of the
relevant criteria, and has few of the defects of other suggested taxes.
The individual income tax can distribute the burden equitably, since
it provides exemptions and is levied at progressive rates. The tax
is based on net income — the fairest known measure of individual
ability to pay taxes. Because it is progressive, and can therefore be
adjusted to individual needs, it is capable of almost indefinite ex
pansion as our revenue requirements increase.
In one important respect, however, the individual income tax in
its present form is inadequate. As it d.s new collected the income
tax is payable only in the year following the year in which the income
is received. In consequence, the income tax is not quickly responsive
to changes in the national income or to changes in tax rates. This
defect can in large part-be eliminated by the introduction of collection
at the source. It is for this reason, among others, that the Treasury
has so strongly urged that col3_ection at source be used in connection
with the regular net income tax.
- 9 The existing method of collecting the inconfe tax was reasonably
adequate when the income tax was essentially a rich man’s tax, when
it,was imposed at relatively moderate rates, and when we could do
our national planning in terms of years rather than months. Conditions
of this sort no longer prevail. The income tax is now biting harder
and deeper than ever before. With over 30 million people filing
returns in 1943, it will be truly a mass tax. As such it must be
adapted to the needs of the great bulk of wage earners and other re
cipients of small incomes who are accustomed to budgeting on a weekly,
or monthly, rather than on a yearly basis. The best way to do this—
and thereby to minimize hardship for taxpayers and cut down delin
quency— is to provide for the deduction of income taxes currently
from pay 'envelopes and from dividend checks.
Collection at the source Till therefore be an aid to the tax
payer. But it is much more. It permits the income tax to be a truly
effective instrument for inflation control. Through collection at
source tne income stream can be tapped as it flows into the hands of
individuals before they have had a chance to spend the money. Through
collection at source, tax rates can be changed and the change can be
made effective almost immediately. Since it will case the burden of
tax payment, collection at source can make possible the imposition of
much heavier taxes than would otherwise be tolerable. These conclusions
are strongly supported by the experience of other countries which have
found collection at source an indispensable part of a strong and
vigorous individual income tax. Great Britain, Canada, and Australia—
to mention only a few examples— -have found it essential to make col
lection at source an integral part of their tax system.
As passed by the House, the 1942 Revenue Bill provided for the
collection of tax at source from wages, dividends, and interest at
a rate of 5 percent in 1943 and 10 percent thereafter. The amount
of tax collected at source would have been based not on the gross
amount of wages but only on that part which was in excess of personal
exemptions and credits. For dividends and interest, it would have
been based on the gross amount paid* However, the Treasury has since
recommended the exemption of interest from viitliholding because with
holding on this type of income involves special administrative and
compliance problems for only a minor amount of revenue..
This system of collection at source Yrould not have been an
additional tax* It would have been simply a means of easing the
payment of the regular income tax* The amounts withheld would have
been credited against the tax liability reported on the income tax
return filed March 15th* Where collections at source exceeded final
tax liability, prompt refunds would have been made.
The Senate Finance Committee initially approved the collectionat—source provisions adopted by the House* More recently, however,
in endorsing a 5 percent tax on gross income in excess of $624, the
Senate Finance Committee decided to recommend the elimination of
collection at source of tnc net income tax* The Committee, Yuhile
accepting the basic principle of collection at source, restricted
its application to the 5 percent gross income tax* The 1942 Revenue
Act is still in process, and I hope that in its final form it will
provide for collection at source of the net income tax— the most
important part of our individual income tax structure.
The House Bill provided for collection at source at a rate of
5 percent in 1943 and of 10 percent thereafter in order to ease the
problem of transition to collection at source* For individuals who
have not made advance provision for their income tax, a transition
problem arises in attempting to put the income tax on a current
collection basis. Such individuals are faced with the necessity
of paying their last year’s tax and at the same time paying part of
the tax on their current income. Perhaps the best way to overcome
this difficulty is to make the transition gradual as was provided
in the House Bill,
The Ruml Plan
Another method which lias been advanced as a means of putting
income taxpayers on a current basis is the Ruml plan. This plan has
been called the skip-a-year plan and the pay-as-you-go plan. It does
skip a year. It is not truly a ’’pay as you go” plan. The Ruml plan
skips a year by changing labels. The income tax you pay this year
now bears the label, ’’tax on 1941 income.” Mr. Ruml Ytould change
that label to ”tentative tax on 1942 income.” In other words, he
Yrould forgive the 1941 tax entirely and treat the payments you make,
this year as current payments on your 1942 income. But that is not
all. When March, 1943} comes around, you would have to file a return
shoYiing your actual 1942 income. If that is higher or lower than your
1941 income— and it will rarely be the same— you would either pay an
additional tax or claim a refund. So far, the tax computations have
all been at existing rates and exemptions.
-
11
-
The next step is to compute a tentative tax for 194-3* To do
this, you 'would apply to your 194-2 income the higher rates and lower
exemptions in the new tax bill* That tentative tax wo•'.aid then be
adjusted in March, 1944* on the basis of actual 194-3 income.
In effect, the'Ruml plan requires two returns and two sets of
computations to determine one year*s tax. This will confuse the tax
payer, and put added burdens on him without producing any added revenue*
'Tills might be tolerable if the Ruml plan were fair, and if it accomplished
the highly desirable objective of putting taxpayers on a current basis.
The basic objections to the plan are that it is not fair and that it
does not accomplish its avowed objective*
The forgiveness of 1941 tax liabilities grants a windfall gain to
anyone who had an unusually high income in 3.941» A person with a
normal income of $3,000 who received $10,000 in 1941 would immediately
escap.'e. the tax on the added $7,000* Eventually— when he ceased to
have any taxable income— he would escape the tax on the original
$3,000. The Ruml plan confers the greatest benefit on those with the
biggest incomes^ Between BO and 90 percent of taxpayers have incomes
«»below $3,000. In their cases the amount of tax forgiven would vary
from,, a few dollars to a maximum of two or three hundred dollars. But
the wealthy man with an income of half a million dollars would save
a tax liability of more than $350,000.
What kind of morale would our workers have if they saw such a
bounty going to the wealthy? How would those whose incomes had
remained stationary, or even fallen in 1941* react to a tax plan yjhich
specially favored those whose incomes had been abnormally high that
year? And, most important, how would the morale of our fighting men
be affected by a plan which would cancel, billions of dollars of tax
liabilities in the midst of a cruel and costly war?
-
12
-
Ironically, the Ruml plan fails to accomplish its avowed
objective, namely, to put the taxpayer on a current basis. Tnis
failure arises from the necessity of adjusting annually the tax
paid during the preceding year to take account of year-to-year in
come variations. If a taxpayer’s 19U3 income is $3,000 while his
19^2 income was $10,000, he will currently have to pay a $10,000level tax out of a $3,000 income; or if it is the other way around,
he will pay a $3,000-level tax out of a $10,000 income. Changing
the label on the tax has certainly not put the taxpayer on an actual
pay-as-you-go basis. In fact, the annual adjustment for the previous
year’s payments means that taxes of persons with fluctuating incomes
will be even further out of step with income than they are at present.
Treasury studies using the incomes of selected taxpayers over a 10year period show that in every case taxes would have fluctuated
m0re— would have been further out of step with income— under the Ruml
plan than under the present payment method.
The objective of putting the income tax on a current basis is
an admirable one and deserves hearty support. The sound m y to
accomplish this objective is to collect as much as possible at the
source— that is, to withhold at least the basic part of the tax
from wages, salaries, and dividends at the time they are paid.
That is a truly pay-as-you-go method.
The spendings tax
The net income — not the gross income — tax comes closest to
satisfying the tests I have set forth. It should, therefore, remain
our major reliance for war finance. At the same time, if the income tax is increased rapidly, a point is reached beyond which further
increases run counter to some of the tests of sound taxation. Under
present conditions it is difficult to increase the individual income
tax as much as is necessary unless allowance is made for fixed com
mitments to repay debts, to pay life insurance premiums, and to make
regular savings — forms of expenditures that exert no inflationary
pressure. Further the income tax operates exclusively through writhdrawing purchasing power; it does not encourage individuals to use
the money that remains for saving rather than spending.
- 13 -
These shortcomings can be overcome by supplementing the income
tax for the duration of the war — and for this period only — with
a spendings tax of the type recently proposed by the Treasury. Such
a spendings tax is designed to exert pressure at those points where
the income tax cannot do so. In conjunction with the income tax it
provides a flexible and adaptable tax mechanism.
The spendings tax would be levied on the amount that individuals
spend on consumer goods and services. .It would, provide for the complete
exemption of individuals whose spendings are below specified amounts.
It would be levied at progressive rates on spendings above these
amounts. Because it is levied on spendings rather than income» it
would give relief to persons who are devoting a large part of their
income to the repayment of debt, payment of life insurance premiums,
the purchase of war bonds and other forms of saving. Because savings
in arry form are exempt from the tax, the spendings tax gives individuals
an incentive to save rather than to spend. The money which is saved
is not taken as tax revenue but it is removed from the spendings
stream. It can no longer contribute to inflation.
The spendings tax has been compared with a sales tax. Such a
comparison is dangerously misleading. To say that the spendings tax
and the sales tax are equally capable of dealing with inflation be
cause both are levied on consumer expenditures is equivalent to
saying that a destroyer and a canoe are equally capable of dealing
with a submarine because both float on water. The spendings tax
is a strong and powerful instrument capable of dealing with' the
dangers of inflation. It has all of the virtues of the sales tax
and none of its defects. The sales tax, on the other hand, is
completely inadequate as an instrument of inflation control. It
does not reach the magnitudes of our problem.
The spendings tax is more powerful as an inflation curb than the
sales tax because it can be made selective in its impact. By granting
exemptions and by being levied at progressive rates it can bring
pressure to bear where pressure is needed. It can force substantial
reductions in consumption by persons whose living standards can stand
such reductions without at the same time putting a crushing burden
on the persons whose living standards are low'. The spendings tax
therefore combines equity with real inflation control.
- Ill Conclusion
I have been discussing a few of the many taxes that might be used
to avoid inflation. The evils of inflation are widely recognized*
Nonetheless, continued and accelerated inflation remains a very real
threat; Disagreement about the proper course of action combines with
inertia and wishful thinking to produce inaction. There is no more
urgent and pressing need today than the need for a widespread under
standing of the dangers of inflation, of the factors that are responsible
for this danger, and of the factors that must be taken into account
in developing a program to avoid inflation*
During the past week the Congress and the President have taken
drastic action to control one phase of the inflation problem — * rising
wage rates and farm prices. If the new bill is to be fully successful,
it must be supplemented by equally drastic action dealing with the
growing disparity between incomes available for spending and the supply
of goods and services available for purchased This disparity can be
reduced or eliminated by greatly increased taxation. In deciding
what taxes to use for this purpose we must never lose sight of the
fact that one of the major functions of taxation is to distribute an
inevitable burden more equitably than inflation would distribute it.
We must direct our energies to the construction of a tax system that
is at once severe enough to prevent excess purchasing power from
breaking price ceilings and sensitive enough to allow for individual
needs and abilities* The construction of a tax system that in this
sense combines adequacy with equity will be a major contribution to
the successful prosecution of the war and to a satisfactory readjustment
after the war.
subscriptions allotted, and they «ay issue Interin receipts pending delivery of
the definitive notes.
2.
The Secretary of the Treasury nay at any time, or from tin» to tins,
prescribe supplemental or aasmdatoxy rules and regulations governing the
offering, which will be Possamicated pronptly to the Federal Reserve Banks.
M E T lIQBGJMHAli, JB.,
Secretary of the Treasury*
3 and to eloa« the book* as to any o p all subscriptions at ujr tins without notice)
«id any action be «ay take in these respects shall be final.
Subject to ♦e.-ttt
reservations, and within the aaount of the offering, subscriptions fer amounts
^
to and including 125,000 fraa banks which accept demand deposits, and sub-
serlptions in any anosmt fro« all other subscribers, will be allotted in full,
subscriptions for a«ounts over «25,000 tram banks which accept demand deposits
will be allotted on an equal percentage basis, to be publicly
■snt notices will be sent out promptly upon allotment«
IT.
1«
PAYMENT
Payment at par and accrued Interest from June 5, 1942, for notes allotttd
hereunder mist be made or coopleted on or before October 15, 1942, or on later
allotment*
In every case where payment Is not so completed, the payment with
application up to 5 percent of the aaount of notes applied for shall, upon
declaration mads by the Secretary of the Treasury in his discretion, be for
feited to the United States*
Any qualified depositary w i n be permitted to
make payment by credit for notes allotted to it for itself and its customers
up to any amount for which it shall be qualified in excess of existing deposits,
when so notified by the Federal Keaerve Bank of ite district.
Accrued interest
at 1-1/2 percent from June 5, 1942, to October 15, 1942, on *1,000 face amount
is §5*41209*
V*
1«
GENERAL PROVISIONS
As fiscal agents of ths United States, Federal Reserve uanfrf are
authorised and requested to reeelve subscriptions, to make allotments on the
basis and up to the amounts indicated by the Secretary of the Treasury to the
Federal Reserve Banks of ths respective districts, to issue allotment notices,
to receive payment for notes allotted, to make delivery of notes on full-paid
fl
2
—
redemption prior to maturity«
**2. The Income derived fro* the note« shall be subject to all
Federal taxes, now or hereafter Imposed* The note« shall be subject
to estate, inheritance, gift or other excise taxes, whether Federal
or State, but shall be except from all taxation now or hereafter
deposed on the principal or interest thereof by any State, or any
of the possessions of the United States, or by any local +**<*>*
authority*
*3* The notea will be aooepted at par during such tine and under
such rules and regulations as shall be prescribed or approved by the
Secretary of the Treasury in payment of income and profits taxes paya
ble at the maturity of the notes*
I,i!'
*4* The notes will be acceptable to secure deposits of public
moneys, but will not bear the circulation privilege*
"5* Bearer notes with interest coupons attached will be issued
if denominations of #100, #500, *1,000, #5,000, #10,000 and #100,000*
The notes will not be Issued in registered form*
*&* The notes will be subject to the general regulations of the
Treasury Department, now or hereafter prescribed, governing United
States notes* "
III.
1.
SUBSCRIPTION AND ALLOTMENT
Subscriptions sill be received at the Federal Reserve Banks and Branch
and at ths Treasury Department, Washington,
Subscribers must agree not to sell or
otherwise dispose of their subscriptions, or of the securities which may be
allotted thereon, prior to the dosing of the subscription bods.
Banking Insti
tutions generally may submit subscriptions for account of customers, but only ths
Federal Reserve Banks and ths Treasury Department are authorised to act as
official agencies.
Others than banking Institutions will not be permitted to
sntsr subscriptions except for their own accounts
Subscriptions fro® banks and
trust companies for thsir om account will be received without deposit*
Sub
scriptions from all others must be accompanied by payment of 5 percent of the
amount of notes applied for*
2*
Ths Secretary of the Treasury reserves the right to reject any subscrip
tion, in whole or in part, to allot lots than ths amount of notes applied for,
UNITED STATES Of AMERICA
1-1/2 PERCENT TREASURY ROTES OF SERIES B-1946
Dat«d and bearing interest from June
5,
1942
Due December 15,
Interest payable «Rine 15 and December
15
ADDITIONAL ISSUE
1942
Department Circular No. 499
TREASURY DEPARTMENT,
Office of the Secretary,
Washington, October 8, 1%
Fiscal Service
Bureau of the Public Debt
I#
1.
OFF
OF ROTES
The Secretary of the Treasury, pursuant to the authority of the Second
Liberty Bond Act, as amended, inrites subscriptions, at par and aeerusd interest,
t
from the people of the United States for notes of the United States, designated
V
1—1/2 percent Treasury Rotes of Series B—1944»
V*
At the same tins the Secretary of
th# Treasury is inviting subscriptions for 2 perosnt Treasury Bonds of 1950-52
r
ì
^
under Department Circular No* 49$.
$4,000,000,000, or thereabouts.
The aggregate amount of both issues *rm be
The amount of notes to be Issued hereunder will
be determined by the relation which the total subscriptions for the notes bear to
the total subscriptions received for both the notes and the bonds,
II,
1,
DESCRIPTION OF ROTES
The notes now offered will be an addition to and will font a part of the
series of 1—1/2 percent Treasury Rotss of Series B—1944 Issued pursuant to Depart
ment Circular R6.
686, dated
May 25, 1942, will be freely interchangeable therewith,
are identical in all respects therewith, and are described in the following quota
tion from Department Circular No,
686s
«1. The notes will be dated June 5, 1942, and will bear interest
from that date at the rate of 1-1/2 percent per annum, payable on a
semiannual basis on December 15, 1942, and thereafter on June 15 and
December 15 in each year until the principal amount becomes payable.
They will mature December 15, 1944, and will not be subject to call for
J
J
* s ~
2«
«baia «
Ite« Secretar? ojf lite« Ìpiiiwy raaarvea tha righi« io r©jcct any siibscripiio^
la pari» te i U o t l«a« than thè «¿amali of bordi» ©pplied f@r, and io elee« ttee
boato» aa t© any or «IX attbacrir’tiona at any Urne «itfaont aotiecj and any «alio» he *»
tako in tit«a# raspaci» «hall ba fisti«
Subj©ci to these reaeramtiona, and «tibia Ih« \
mmm% « f thè ottmeimg» «ubacripilona ter tmoxmte up to «ad includine |25,OQQ fra« b J
«teicte accept diaind deposita, «ad subaerlpticm» in any aaoarit fro» « U other subserid
«131 be allottaci la falli subscriptiona
ter m m m t e e w
$25,000 Iress benha «faieh acci
d«tt«a»d deposita «111 be «Xlottad «a «a «qual pareanta&e basta, te b« publicly
AUota«at noti««« «ili te* sani ©ut preaptly «poti aIlotm*nt.
H,
X»
PÀBÌJ$f
f«y*M»st «t par «ad accrued intere«!, if any, for benda «llotted h*rtund*r «si
b* «ade ©r eeapleted on or baiare Oetober 19, 19*2, or ©fi later alletisent,
la « y ^
« m «bere padani 1« net «e «empietti, thè pmymmt altfa applicati©*! up te f parami
tlie aaount et borda appliad far «hall, «pon declorati«» «ode by tfae Secretai? oJf thè
ìreaaory la ili« dlaeretlee, be forfaited te tb« United State»*
Apy qualifica depoaitaj
« I H be poraitted te mali» pagnant by credit far benda allottaci te li for itealf «ad ih
twrt—
r» «p to *ny ansate for which it shall te qualified la axcsss ef
d«-
P«aita, «tee so astino« by ite Foderai Seeerve Bank of ita districi.
f . snaatt, p«marna
1. As noesi «genti of thè United States, Federai toste«« a-»*« sre authorleei
atei reqBsated to roseto« svbseripUons, to osto allotoente on «te testa and «g>te ite
aaoooto indicated to ite Seoretary of thè Treaeary io thè
reterai tosano «-"*« of tu
raspastive districte, to i s a m allotaent notiees, to roseive paynant for benda allotti
to osto delirei? of tendo so full-paid steoiftloai allotted, and they nay lesse in
teri« reeaipte potete« delivery of ite definitive beute.
2.
Ite toorotarr of tk* tteasury «to te *ny tino, or tea» tino te tiao, preteriti
euppleneatal or aaantetery miss and rto«tetl«ns governine thè offerte«, ehieh vili M
ce— unicated prosspUy te thè Faterai tooorvo Beate.
msx«marna,
a
<nt.,
Soer otary of tha treasury
• atary of the Treasury*
From the date of redemption designated in any such notice,
interest on the bonds called for redmaption shall cease.
2.
She income derived from the bonds shall b# subject to all Federal ta w ,
m m or hereafter imposed.
The bonds shall bs subject to citato, inheritance, gift
or other excise taxes, whether Federal or State, but shall be exempt from all tax»,
tion now or hereafter imposed on the principal or interest thereof by any State, or
any of tho possessions of the United States, or by any local taxing authority.
3«
The bonds will bs acceptable to scours deposits of public moneys, but will
not bear the circulation privilege and will not bs entitled to any privilege of
conversion.
4*
Bearer bends with interest coupons attached, and bonds roglotsred as to
principal and interest, will be issued in denominations of HOD, #$00, #1,000, $5,03
#10,000 sad #100,000.
Provision will be made for the interchange of bonds of dif* '
farent denominations and of coupon and registered bonds, and for tho transfer of rqj
terod bonds, under rules and regulations prescribed by the Secretary of the trsasmJ
$.
ihe bonds will be subject to the general regulations of the Treasury jeparfc
mint, now or heraafter prescribed, governing United States bonds.
HI.
1.
SUBSCRIPTION AKD ALLQTttidS?
Subscriptions will be received at the Federal Reserve Banks and Brandies
and at the Treasury Department, Washington.
Subscribers must agree not to soil or
otherwise dispose of their subscriptions, or of the securities which may bs allott#
thereon, prior to the d osing of the subscription books.
RapkfPig institutions gw»
erally may submit subscriptions for account of customers, but only the Federal Re*
serve Banks and the Treasury Department are authorised to act as official agencies.
Others than banking institutions will not bo permitted to enter subscriptions axeqt
Tor their own account.
Subscriptions from banks and trust companies for their
account will be received without deposit.
Subscriptions from all others must bs
accompanied by payment of $ percent of the amount of bonds applied for.
mzrw s t a t u s or a m e b i c a
2 P m G M T TMA3ÜST BCMDS QF 1950-52
Usted and hearing interest from Gctober 19, 1942
M D S M A B L S AT TH£ OPTION OF m
i
Dim March 15, 1952
UNITED STATES AT PAH AMD ACCRUED IN TiltEST OH AMD
AFTER MARCH 15, 1950
Interest payable March 15 «ad Saptember 15
TREASUHT DKPARTM8ÌT,
Office of thè Secretar^,
Washington, October 6, 1942,
1942
Dspartmsnt Circular ho. 698
Fiscal Service
Bureau of thè Public Debt
I.
1.
OFFERING OF BONUS
The Secreta*y of thè Treaeuzy, pureuant to thè authority ef thè Second
liberty Bond Act, ae amended, invitee subscriotions, at par and accrued interest,
frora thè people of thè United States for bende of thè United States, deaignated
2 percent Treaaury Bende of 1950*52*
At thè asme Urne thè Secretar^ of thè Treassxyi
ie inviting eubecriptione for an additional amount of Treaaury Rotea of Series
«»der Department Circolar No. 699.
#4,000,000,000, or thtfeiboatt.
3-1944
The aggregate amount of both leeuee sili be
The amount of honda to be ieaued hereunder vili b# j
determined by thè rslation which thè total aubacrlptiona for thè bende bear to the
total aubecriptiona received for both thè benda and thè notes.
li*
1*
DKSC&iraOH
OF BOKDS
The benda vili be dated October 19, 1942, and vili bear interest from that
date at thè rate of 2 percent per annua, payable on a sersianimai baeie on March X5
and ¿eotember 15 in eaeh year until thè principal amount becomes payable.
Ihsy vili
mature March 15, 1952, but may be redeemed at thè catión of thè United States on and
after March 15, 1950, in vhole or in part, at par and accrued interest, on any In- |
tereet day or daya, on 4 nonths* notice of redemption given in aueh animar as thè
Secretary of thè Treaaury shall prescribe.
In case of partici redemption thè bond*
to be redeamed vili be determined by such method ae may bs prescribed by thè Sacri
Subject to the usual reservations, and within the amounts of the
respective offerings, subscriptions for each issue for amounts not
exceeding $25,000 from banks which accept demand deposits, and subscrip
tions in any amount from all other subscribers, will be allotted in
full; subscriptions for amounts over $25*000 from banks which accept
demand deposits will be allotted on an equal percentage basis, to be
publicly announced.
Payment for any bands allotted must be made or
completed on or before October 19, 1942# or on later allotment.
Payment
for any notes allotted must be made or completed on or before October 15,
1942, or on later allotment, and must include accrued interest from
June 5, 1942.
(The amount of accrued interest from Juno 5 to October 15,
1942 is about $5*41 per $1,000.}
The texts of the official circulars follow«
the notes now offered wlii be an Addition to «id will form a
pert of the series of 1-1/2 percent Treasury Sdte» of Series B-1946,
issued pursuant to Department Circular So. 686, dated aay 2$, 1942*
They are identical in all respects with such notes with which they
will be freely interchangeable.
The notes are dated June
3,
1942,
and bear interest frost that date at the rate of 1-1/2 percent per
annu&i payable on a ssudanttu&l basis on December 13# 1942 and thereafter
cm June 13 and December 13 in each year until they mature on Peeeafcer
13# 1946.
They will wot be subject to call for redemption prior to
maturity.
They will be Issued only in bearer form with interest coupons
attached# in denominations of $100# #300, $1,000, #3#000, 110,000 and
$100,000.
Pursuant to the provisions of the Public Debt Act. of 1941, Interest
upon the bonds and notes now offered shall not have W e x e m p t i o n s , as
such, under Federal Tax Acts now or hereafter enaev^d.
The fbll provi
sions relating to taxability are set forth in the official circulars
released today*
Subscriptions will be received at the Federal deserve Banks and
Branches, and at the Treasury Department, Washington.
Banking institu
tions generally may submit subscriptions for account of customers, but
only the Federal .«serve Banks and the freasuiy Depertiacnt are authorized
to act as official agencies.
3t*>script ions fro© banks and trust
companies for their own account will be received without deposit, but
subscriptions fro* all others
miut be
accoi&psnied by payment of
of the amount of bonds or notes applied for.
3 perc<mt
Tii&i&UliT J&iiOKXXr
Washington
fad ¿sKLMs.1, m m im
Press Service
Thursday» October 8« 1942»
Ho.
10/ 7 / ¿ a
3 1 - Z 3
Secretary of the Treasury Morgenthau tods/ announced the offering*
through the Federal deserve Banks* for cash subscription at par and
accrued interest of 2 percent Treasury Bopda of 1950-52* and an addi
tional amount of 1-1/2 percent Treasury ¡totes of Series 3-1946.
The
aggregate amount of both issues will be #4*000*000*000* or thereabouts*
and the proportionate amount of bonds and notes to be issued «1311 be
determined by the relation bet seen the total subscriptions received for
each and the total subscriptions received for both«
In order t o insure
widespread participation of banks* corporations and others «ho may be
interested* and for the convenience of investors* the subscription bocks
for each isuie will remain open two days* that is* through Friday,
October 9«
there will be no restrictions as to the basis for subscrib
ing for either the bonds or the notes.
The Treasury Bonds of 1950-52, now offered for subscription* will
be dated October 19* 1942, and will bear interest from that date at the
rate of 2 percent per annum payable semiannually with the first c o u p o n
due larcdi 15* 1943* for a fractional period«
The bonds will mature
March 15, 1952* but may be redeemed, at the option of the United States,
on and after March 15* 1950«
The bonds will be issued in two format
bearer bonds with interest coupons attached* and bonus registered both
as to principal and interest«
Both forms will be issued in denominations
of #100, 1500, #1*000, #5,000* $10,000 and £100*000.
TREASURY DEPARTMENT
Washington
F O R RELEASE, M O R N I N G NEWSPAPERS,
Thursday, O c t o b e r S, 19^2.
T0 /7 A 2 -------- “ — ‘— 1--------------
Press Service
No.
^ o:>
S e c r e t a r y of the T r e a s u r y M o r g e n t h a u t o d a y a n n o unced
offering,
t h r o u g h the F e d e r a l R e s e r v e Banks,
t ion at p a r and a c c r u e d
the
for c a s h s u b s c r i p
interest of 2 p e r c e n t T r e a s u r y B o nds of
I 9 5 O - 5 2 , and an a d d i t i o n a l amount of 1-1/2 p e r c e n t T r e a s u r y
N o t e s of Series B-19^6.
w i l l be
T h e a g g r e g a t e amount of b o t h Issues
000,000,000,
a m o u n t of bonds
or thereabouts,
a n d the p r o p o r t i o n a t e
and n o tes to be I s sued w i l l be d e t e r m i n e d by
the r e l a t i o n b e t w e e n the total
s u b s c r i p t i o n s r e c e i v e d f o r e ach
and the total s u b s c r i p t i o n s r e c e i v e d f o r both.
sure w i d e s p r e a d p a r t i c i p a t i o n of banks,
who m a y b e interested,
In o r d e r to i n
c o r p o r a t i o n s and others
a n d for the c o n v e n i e n c e of investors,
the
s u b s c r i p t i o n b o o k s f or eac h i s s u e will r e m a i n o pen two days,
that
is,
t h r o u g h Friday,
October
9.
T h e r e wil l be no r e s t r i c
tions as to the b a s i s f o r s u b s c r i b i n g for e i t h e r the b o nds or
the notes.
T h e T r e a s u r y Bonds of 1950-52, n o w o f f e r e d f or subscription,
will be d a t e d O c t o b e r 1 9 * 19^-2, and will b e a r interest fro m that
date at the rate of 2 p e r c e n t per a n num p a y a b l e s e m i a n n u a l l y w i t h
the first coupon due M a r c h 15, 19^3, for a f r a c t i o n a l period. The
b o n d s will m a t u r e M a r c h 15, 1 9 5 2 , but m a y be redeemed, at the
o p t i o n of the U n i t e d States, on and a f t e r M a r c h 15, 1950.
T he
b o n d s will be i s s u e d in two forms:
b e a r e r b o n d s w i t h I n t erest
coupons attached, a n d bonds r e g i s t e r e d b o t h as to p r i n c i p a l and
interest.
B o t h f o rms will be issued in d e n o m i n a t i o n s of ¿100,
$ 5 0 0 , #1,000, 15,000, $ 1 0 , 0 0 0 and $100,000.
T h e notes n o w o f f e r e d will be an a d d i t i o n to and w ill form
a part of the series of 1 - 1/2 p e r cent T r e a s u r y N o t e s of Series
B-1946, I s s u e d p u r s u a n t to D e p a r t m e n t C i r c u l a r No. 6S6, d a t e d
- 2
May 25, 19^2.
They are identical in all respects with such
notes with which they will be freely interchangeable.
The notes
are dated June 5, 1942, and bear interest from that date at the
rate of 1 - 1/2 percent per annum, payable on a semiannual basis
on December 15, 19^2 and thereafter on June 15 and December 15
in each year until they mature on December 15 , 19*^6 . They will
not be subject to call for redemption prior to maturity.
They
will be issued only in bearer form with interest coupons
attached, in denominations of # 100, # 500, #1 ,000, #5 ,000,
# 10,000 and # 100,000.
Pursuant to the provisions of the Public Debt Act of 19^1,
Interest upon the bonds and notes now offered shall not haye any
exemptions, as such, under Federal Tax Acts now or hereafter en
acted.
The full provisions relating to taxability are set forth
in the official circulars released today.
Subscriptions will be received at the Federal Reserve Banks
and Branches, and at the Treasury Department, Washington.
Bank
ing institutions generally may submit subscriptions for account
of customers, but only the Federal Reserve Banks and the Treasury
Department are authorized to act as official agencies.
Sub
scriptions from banks and trust companies for their own account
will be received without deposit, but subscriptions from all
others must be accompanied by payment of 5 percent of the amount
of bonds or notes applied for.
Subject to the usual reservations, and within the amounts
of the respective offerings, subscriptions for each issue for
amounts not exceeding # 25,000 from banks which accept demand
deposits, and subscriptions in any amount from all other sub
scribers, will be allotted in fullj subscriptions for amounts
over # 25,000 from banks which accept demand deposits will be
allotted on an equal percentage basis, to be publicly announced.
Payment for any bonds allotted must be made or completed on or
before October 19, 19^2, or on later allotment.
Payment for any
notes allotted must be made or completed on or before October 15 ,
1942, or on later allotment, and must Include accrued interest
from June 5 » 19^2.
(The amount of accrued interest from June 5
to October 15 , 19^2 is about #5.^1 per #1,000.)
The texts of the official circulars follow:
UNITED STATES OF .AMERICA
>
2 PERCENT TREASURY BONUS OP 1950-52
Dated and bearing interest from October 19, 19*+2
Due March 15, 1952
REDEEMABLE AT THE OPTION OF THE UNITED STATES AT PAR AND ACCRUED INTEREST ON AND
AFTER MARCH 15, 1950
Interest payable March 15 and September 15
19^2
Department Circular No*
TREASURY DEPARTMENT,
Office of the Secretary,
Washington, October 8, 19^-2.
69S
Fiscal Service
Bureau of the Public Deb£
I.
OFFERING OF BONDS
1. The Secretary of the Treasury, pursuant to the authority of the
Second Liberty Bond Act, as amended, invites subscriptions, at par and accrued
interest, from the people of the United States for bonds of the United States,
designated 2 percent Treasury Bonds of 1950-52* At the same time the
Secretary of the Treasury is inviting subscriptions for an additional amount
of Treasury Notes of Series B-19^-6 under Department Circular No. 699* The
aggregate amount of both issues will be $U,000,000,000, or thereabouts. The
amount of bonds to be issued hereunder will be determined by the relation
which the total subscriptions for the bonds bear to the total subscriptions
received for both the bonds and the notes.
II.
DESCRIPTION OF BONDS
1. The bonds will be dated October 19, 19^2, and will bear interest from
that date at the rate of 2 percent per annum, payable on a semiannual basis on
March 15 and September 15 in each year until the principal amount becomes pay
able* They will mature March 15, 1952, but may be redeemed at the option of
the United States on and after March 15, 1950» in whole or in part, at par and
accrued interest, on any interest day or days, on H months’ notice of re
demption given in such manner as the Secretary of the Treasury shall prescribe.
In case of partial redemption the bonds to be redeemed will be determined by
such method as may be prescribed by the Secretary of the Treasury. From the
date of redemption designated in any such notice, interest on the bonds
called for redemption shall cease.
2. The income derived from the bonds shall be subject to all Federal
taxes, now or hereafter imposed. The bonds shall be subject to estate,
inheritance, gift or other excise taxes, whether Federal or State, but shall
be exempt from all taxation now or hereafter imposed on the principal or
interest thereof by any State, or any of the possessions of the United
States, or by any local taxing authority.
-
2
-
3* The bonds will be acceptable to secure deposits of public moneys,
but will not bear the circulation privilege and will not be entitled to any
privilege of conversion»
1+. Bearer bonds with interest coupons attached, and bonds registered
as to principal and interest, will be issued in denominations of $100, $ 500,
$1,000, $5,000, $10,000 and $100,000. Provision will be made for the inter
change of bonds of different denominations and of coupon and registered
bonds, and for the transfer of registered bonds, under rules and regulations
prescribed by the Secretary of the Treasury.
5» The bonds will be subject to the general regulations of the Treasury
Department, now or hereafter prescribed, governing United States bonds.
III.
SUBSCRIPTION AND ALLOTMENT
i; Subscriptions will be received at the Federal Reserve Banks and
Branches and at the Treasury Department, Washington. Subscribers must agree
not to sell or otherwise dispose of their subscriptions, or of the securities
which may be allotted thereon, prior to the closing of the subscription books.
Banking institutions generally may submit subscriptions for account of
customers, but only the Federal Reserve Banks and the Treasury Department
are authorized to act as official agencies. Others than banking institutions
will not be permitted to enter subscriptions except for their own account.
Subscriptions from banks and trust companies for their own account will be
received without deposit. Subscriptions from all others must.be accompanied
by payment of 5 percent of the amount of bonds applied for.
2. The Secretary of the Treasury reserves the right to reject any sub
scription, in whole or in part, to allot less than the amount of bonds applied
for, and to close the books as to any or all subscriptions at any time without
notice; and any action he may take in these respects shall be final. Subject
to these reservations, and within the amount of the offering, subscriptions
for amounts up to and including $ 25,000 from banks which accept demand
deposits, and subscriptions in any amount from all other subscribers, will
be allotted in full; subscriptions for amounts over $25,000 from banks which
accept demand deposits will be allotted on an equal percentage basis, to be
publicly announced. Allotment notices will be sent out promptly upon allot
ment.
IV.
PAYMENT
1. Payment at par> and accrued interest, if any, for bonds allotted here
under must be made or completed on or before October 19, 19^2, or on later^
allotment. In every case where payment is not so completed, the payment with
application up to 5 percent of the amount of bondfe applied for shall, upon
declaration made by the Secretary of the Treasury in his discretion, be for
feited to the United States. Any qualified depositary will be permitted to
make payment by credit for bonds allotted to it for itself and its customers
- 3 -
up to any amount for which it shall "be qualified in excess of existing de
posits, when so notified "by the Federal Reserve Bank of its district.
V,
GENERAL PROVISIONS
1. As fiscal agents of the United States, Federal Reserve Banks are
authorized and requested to receive subscriptions, to make allotments on the
basis and up to the amounts indicated by the Secretary of the Treasury to
the Federal Reserve Banks of the respective districts, to issue allotment
notices, to receive payment for bonds allotted, to make delivery of bonds
on full—paid subscriptions allotted, and they may issue interim receipts
pending delivery of the definitive bonds.
2* The Secretary of the Treasury may at any time, or from time to time,
prescribe supplemental or amendatory rules and regulations governing th®
offering, which will be communicated promptly to the Federal Reserve Banks.
HENRY MORGEUTHAU, JR.,
Secretary of the Treasury.
)
♦
UNITED STATES OE AMERICA
1-1/2 PERCENT TREASURY NOTES OP SERIES B-1946
Dated and "bearing interest from June 5, 1942
Due December 15, 1946
Interest payable June 15 and December 15
ADDITIONAL ISSUE
1942
Department Circular No. 699
----
TREASURY DEPARTMENT,
Office of the Secretary,
Washington, October 8, 1942.
Eiscal Service
Bureau of the Public Debt
I.
0EEERING OE NOTES
1. The Secretary of the Treasury, pursuant to the authority of the
Second Liberty Bond Act, as amended, invites subscriptions, at par and accrued
interest, from the people of the United States for notes of the United States,
designated 1—l/2 percent Treasury Notes of Series B—1946* At the same time
the Secretary of the Treasury is inviting subscriptions for 2 percent Treasury
Bonds of 1950-52 under Department Circular No# 698# The aggregate amount of
both issues will be $4,000,000,000, or thereabouts# The amount of notes to
be issued hereunder will be determined by the relation which the total sub
scriptions for the notes bear to the total subscriptions received for both
the notes and the bonds.
II#
DESCRIPTION OE NOTES
1# The notes now offered will be an addition to and will form a part of
the series of 1-1/2 percent Treasury Notes of Series B-1946 issued pursuant
to Department Circular No# 686, dated May 25, 1942, will be freely inter
changeable therewith, are identical in all respects therewith, and are described
in the following quotation from Department Circular No. 686*
nl# The notes will be dated June 5, 1942, and will bear interest
from that date at the rate of 1-1/2 percent per annum, payable on a
semiannual basis on December 15, 1942, and thereafter on June 15 and
December 15 in each year until the principal amount becomes payable#
They will mature December 15, 1946, and will not be subject to call for
redemption prior t$ maturity#
*2. The income derived from the notes shall be subject to all
Eederal taxes, now or hereafter imposed. The notes shall be subject
to estate, inheritance, gift or other excise taxes, whether Eederal
2 -
or State, but shall he exempt from all taxation now or hereafter
imposed on the principal or interest thereof by any State, or any
of the possessions of the United States, or by any local taxing
authority*
n3. The notes will be accepted at par during such time and under
such rules and regulations as shall be prescribed or approved by the
Secretary of the Treasury in payment of income and profits taxes pay
able at the maturity of the notes*
w4. The notes will be acceptable to secure deposits of public
moneys, but will not bear the circulation privilege*
n5. Bearer notes with interest coupons attached will bo issued
in denominations of $100, $500, $1,000, $5,000, $10,000 and $100,000*
The notes will not be issued in registered form*
H6* The notes will be subject to the general regulations oi1 the
Treasury Department, noiv or hereafter prescribed, governing United
States notes*n
III*
SUBSCRIPTION1AND ALLOTMENT
1. Subscriptions will be received at the Federal Reserve Banks and
Branches and at the Treasury Department, Washington* Subscribers must agree
not to sell or otherwise dispose of their subscriptions, or of the securities
which may be allotted thereon, prior to the closing of the subscription books*
Banking institutions generally may submit subscriptions for account of cus
tomers, but only the Federal Reserve Banks and the Treasury Department are
authorized to act as official agencies* Others than banking institutions will
not be permitted to enter subscriptions except for their own account* Sub
scriptions from banks and trust companies for their own account will be received
without deposit* Subscriptions from all others must be a-cconpenied by payment
of 5 percent of the amount of notes applied for*
2* The Secretary of the Treasury reserves the right to reject any
subscription, in whole or in part, to allot less than the amount of notes
applied for, and to close the books as to any or all subscriptions at any time
without notice; and any action he may take in these respects shall be final*
Subject to these reservations, and within the amount of the offering, subscrip
tions for amounts up to and including $25,000 from banks which accept demand
deposits, and subscriptions in any amount from all other subscribers, will be
allotted in full; subscriptions for amounts over $25,000 from banks which
accept demand deposits will be allotted on an equal percentage basis, to be
publicly announced* Allotment notices will be sent out promptly upon allotment*
IV.
PAYMENT
1* Payment at par and accrued interest from June 5, 1942, for notes
allotted hereunder must be made or completed on or bofore October 15, 1942, or
on later allotment* In every case where payment is not so completed, the
payment with application up to 5 percent of the amount of notes applied for
shall, upon declaration made hy the Secretary of the Treasury in his discre
tion, he forfeited to the United States» Any qualified depositary will he
permitted to make payment hy credit for notes allotted to it for itself and., it
customers up to any amount for which it shall he qualified in excess of exist
ing deposits, when so notified hy the Federal Reserve Bank of its district*
Accrued interest at
percent from June 5, 1943, to October 15, 1942, on
$1,000 face amount is $5*41209*
1-l/s
V»
GENERAL PROVISIONS
1* As fiscal agents of the United States, Federal Reserve Banks are
authorized and requested to receive subscriptions, to make allotments on the
basis and up to the amounts indicated hy the Secretary of the Treasury to the
Federal Reserve Banks of the respective districts, to issue allotment notices,
to receive payment for notes allotted, to make delivery of notes on full—paid
subscriptions allotted, and they may issue interim receipts pending delivery
of the definitive notes*
2* The Secretary of the Treasury may at any time, or from time to time,
prescribe supplemental or amendatory rules and regulations governing the
offering, which will he communicated promptly to the Federal Reserve Banks*
HENRY MORGENTHAU, JR*,
Secretary of the Treasury*
TREASURY DEPARTMENT
Washington
Press Service
No.
J? 3
—
Secretary Morgenthau disclosed today that the Treasury
Department is considering taking a census of American-owned
property in foreign countries. This census w±±irrequire
would
report by persons and organizations subject to the jurisdic
tion of the United States of property outside of the United
States which they own or in which they have an interest.
It would also include questions concerning foreign property
disposed of or lost during the past several years.
The Secretary said that American property abroad, and
particularly that in the belligerent countries, was of con
cern to the Government and that such a census would be of
great usefulness in the war effort and in the postwar period*
TREASOKT DEPARTMENT
W ashington
/O
P re ss S e rv ic e
Wo*
3 3
-
S . 1/
Secretary Morgan th a u d i s c l o s e d to d a y t h a t t h e T re a s u ry
D epartm ent i s c o n s i d e r in g ta k in g a ce n s u s o f Ziaori can-ow ned
p r o p e r ty i n f o r e i g n c o u n t r i e s . T h is c e n s u s M l d E t r e q a l r e i r ^ would
r e p o r t b y p e rso n s an d o r g a n i s a tio n # s u b j e c t t o t h e J u r i s d i c
t i o n o f t h e U n ited S t a t e s o f p r o p e r ly o u ts i d e o f th e U n ited
S t a t e s w hich th e y own o r i n which th e y h ave an I n t e r e s t *
I t would a l s o in c lu d e q u e s tio n s c o n c e rn in g f o r e i g n p r o p e r ty
d is p o s e d o f o r l o s t d u rin g th e p a s t s e v e r e ! y e a r s .
th e S e c r e t a r y s a i d t h a t A m erican p r o p e r t y a b r o a d , and
p a r t i c u l a r l y t h a t i n th e b e l l i g e r e n t c o u n t r i e s , was o f con
c e r n to th e Government and t h a t su ch a c e n s u s would be o f
g r e a t u s e f u l n e s s i n th e w ar e f f o r t and i n t h e p o stw a r pmriod,
TREASURY DEPARTMENT
W a sh in g to n
FOR IMMEDIATE R E L E A S E ,
T h u r s d a y , O c t o b e r S , 19*12.
S ecretary
D ep artm en t
p ro p e rty
rep o rt
in
U n ite d
of
fo re ig n
th e
S ta te s
It
p ro p e rty
The
cern
g reat
to
cen su s
T h is
in
th a t
A m e rica n
th e
such
w ar e f f o r t
past
and
th e
an
in te r
fo re ig n
several
y ears.
ab ro ad ,
co u n trie s,
a
Ju ris
of
have
p ro p e rty
a
re q u ire
th e
co n cern in g
th e
b e llig e re n t
-0 O 0 -
to
th e y
q u e stio n s
th a t
w o u ld
in
w h ich
T reasu ry
A m erican -o w n ed
o u tsid e
said
and
th e
p ro p e rty
d u rin g
th e
of
su b ject
lo st
in
th a t
cen su s
or
G overnm ent
u sefu ln ess
of
own o r
in clu d e
of
S ecretary
S ta te s
th ey
a lso
d isp o se d
th e
a
to d a y
and o r g a n i z a t i o n s
U n ite d
th a t
tak in g
co u n trie s.
w h ich
w o u ld
p a rticu la rly
d isclo se d
co n sid e rin g
by p e rs o n s
d ictio n
est.
Is
M o rgen th au
P re s s S e rv ice
No. 3 3 - 5 ^
and
w as
of
con
cen su s
w o u ld
be
of
in
p o stw a r
th e
p e rio d .
Tbumm vwêùmm?
rat.
M k lu fle ft
FOE RäLIäSE, m m X H G
P re ss Sendet
Friday. Oetobw 9« 1 9 4 2 .__________
"l^833~5~y
L s e c r e t a i y o f t h e T re a su ry tto rg e n th a u announced l a v i n i g h t t h a t th e sub»
e c r i p t i o n books f o r t h e c u r r e n t o f f e r i n g o f 2 p e r c e n t T re a s u ry Bonds o f 1 9 5 0 -5 2
end o f 1 - 1 / 2 p e r c e n t T re a su ry l o t o s o f B o r l e s B -1 9 4 6 w i l l c l o s e a t t h e c l o s e o f
m-
b u s in e s s to d a y , O c to b e r 9*
(S u b s c r ip t io n s f o r e i t h e r I s s u e a d d re s s e d t o a F e d e r a l H e e e rre la n k , o r
B ra n c h , o r t o th e T re a s u ry D ep artm en t, and p la c e d i n t h e » a i l b e f o r e 1 2 o 'c l o c k
m id n ig h t F r i d a y , O c to b e r 9# w i l l b e c o n s id e r e d a s haw ing b ean e n te r e d b e f o r e th e
c l o s e o f th o s u b s c r ip t io n b o o k s.
°r "*wlpUo" “d *•
w i l l p ro b a b ly b e nado on T uesday, O c to b e r 1 3 .
of
TREASURY DEPARTMENT
W ash in gton
FOR RELEASE, MORNING NEWSPAPERS,
Friday, October 9, 19^2.
■>
Press Service
No. 33-55
id/8/42
S ecre ta ry
th a t
th e
cent
T reasu ry
N o te s
th e
Bonds
S e rie s
p la ce d
w ill
th e
be
of
for
195°~ 52
w ill
th e
cu rren t
and o f
clo se
announced l a s t
at
1 -1 /2
th e
o fferin g
p ercen t
clo se
of
n ig h t
2 p er
T reasu ry
o f b u sin ess
O c to b e r 9»
Bank,
in
th e
or
fo r
or
m a il b e f o r e
co n sid ered
su b scrip tio n
a llo tm e n t
e ith e r
B ran ch ,
as
w ill
issu e
to
12
th e
ad d ressed
T reasu ry
o 1c l o c k
h a v in g been
a Fed eral
D e p a rtm e n t,
m id n ig h t
e n te re d
to
F rid a y ,
b efore
th e
and
O cto b e r
clo se
of
books.
A nnouncem ent o f
of
books
B -1 9 ^ 6
S u b scrip tio n s
R eserv e
T r e a s u r y M o rgen th au
su b scrip tio n
of
to d a y ,
of
th e
am ount
p ro b a b ly
of
su b scrip tio n s
b e m ad e o n T u e s d a y ,
*
—oO o—
and th e
O cto b e r
bases
13*
9»
-
Commodity
2-
:
Established Quota
: Unit of : Imports as of
: Period & Country : Quantity : Quantity : Sept. 26, I9U2
Silver or black foxes,
furs, and articles:
Paws, head, or other
separated parts
Piece plates
Articles, other
than piece plates
Crude petroleum, topped
crude petroleum, and
fuel oil
12 months from
Dec. 1,191*1
500
Pounds
(Import quota
filled)
tt
55o
Pounds
None
it
5oo
Unit
Calendar year
Venezuela
Netherlands
Colombia
Other countries
Molasses and sugar
sirups containing
soluble nonsugar
solids equal to
more than 6 of
total soluble
solids
28
2,082,57U,771
Gallon
336,130,696
630,097,196
Gallon
259,190,892
9l*,662,1*90
Gallon
(Import quota
filled)
150,868,31*3
Gallon
(Import quota
filled)
1 ,500,000
Gallon
%
Calendar year
665,663
i
«
1
3-r i
FOE IMSEDIATE RELEASE,
O c t o b e r 19U2.
The Bureau of Customs announced
preliminary figures for imports of
commodities within quota limitations provided for under trade agreements, from the
beginning of the quota periods to September 26, 19^2, inclusive, as follows:
•
_____ Established Quota
: Unit of : Imports as o?
______ *Commodity___________ s Period & Country s Quantity : Quantity ; Sept. 26, 19li2
Cattle less than 200
pounds each
Cattle, 700 pounds or
more each (other than
dairy cows)
Calendar year
Quarter year from
July 1,
Canada
Other countries
100,000
Head
51,720
8,280
Head
Head
63,662
19k2
19,783
(Tariff rate
quota filled)
Whole milk, fresh or sour
Calendar year
3,000,000
Gallon
1*,102
Cream, fresh or sour
Calendar year
1,500,000
Gallon
59l*
Fish, fresh or frozen
filleted, etc., cod,
haddock, hake, pollock,
cusk and rosefish
Calendar year
I?, 17k,1*95
"White or Irish potatoes
certified seed
Other
12 months from
Sept. 15, 1
90,000,000
12 months from
Sept. 15
60,000,000
9l&
Pound
11,926,656
Pound
: 3,288,325
Pound
. 26,261
Cuban filler tobacco,
unstemmed or stemmed
(other than cigarette
leaf tobacco), aid
scrap tobacco
Calendar year
22,000,000
Red Cedar Shingles
Calendar year
2,617,111
Square
2,21*2,322
Silver or black foxes,,
furs, and articles:
Foxes valued under
$250 ea. and whole
furs and skins
Period - May Nov. 19^2
All countries
Ul,77ii
Number
15,750
12 months from
Dec. 1, 1910.
5,000
Tails
Pound
(unstemmed
equivalent)
Piece
(Tariff rate
quota filled)
(Import quota
filled)
TREASURY* DEPARTMENT
Washington
EOR IMMEDIATE RELEASE,
Pridav. October 9. 1942.
Press Service
No. 33-55
The Bureau of Customs announced preliminary figures for imports of com
modities within quota limitations provided for under trade agreements, from the
beginning of the quota periods to September 26, 1942, inclusive, as follows.'
0
___ Commodity
_
Established Quota
: Unit of
J Imports as of
28 *|QA9
i __Period & Country * Quantitv * Quant, it.v ; Sant
Cattle less than 200
pounds each
Calendar year
100,000
Head
51,720
8,280
Head
Head
53,662
Cattle, 700 pounds or
more each (other than
dairy cows)
Qparter year from
July 1, 1942
Canada
Other Countries
Whole milk, fresh or sour
Calendar year
3,000,000
CalIon
4,102
Cream, fresh or sour
Calendar year
1,500,000
CalIon
594
Pish, fresh or frozen
filleted, etc., cod,
haddock, hake, pollock,
cusk and rosefish
Calendar year
17,174,495
Pound
11,926,656
12 months from
Sept. 15, 1942
12 months from
Sept. 15
90,000,000
Pound
288,325
60,000,000
Pound
26,261
White or Irish potatoes
certified seed
Other
Cuban filler tobacco,
unstemmed or stemmed
(other than cigarette
leaf tobacco), and
scrap tobacco
Calendar year
Bed Cedar Shingles
Calendar year
Silver or black foxes,
furs, and articles*
Poxes valued under
$250 ea. and whole
furs and skins
Tails
19,783
(Tariff rate
quota filled)
Pound
(unstemmed
equivalent) (Tariff rate
22,000,000
quota filled)
2,617,111
Square
2,242,322
Period - May —
Nov. 1942
All countries
41,774
Number
15,750
12 months from
Dec. 1, 1941
5,000
Piece
(import quota
filled)
«* 2
—
—
:------- Established foota
: Unit of :Imports as of
-Somnfiditz-------- 1
— L . Period ,& Qountiy ? Quantity st flggntifar:Sept, 36.1942
Silver or black foxes,
furs, and articles:
PavS, head, or other
separated parts
Piece plates
Articles, other
than piece plates
Crude petroleum, topped
crude petroleum, and
fuel oil
12 months from
Dec. 1, 1941
it
n
Calendar year
Venezuela
Netherlands
Colombia
Other .
countries
Molasses and sugar
sirups containing
soluble nonsugar
solids equal to
more than 6$ of
total soluble
solids
Calendar year
~oûo-
500
Pounds
(Import cuota
filled)
550
Pounds
None
500
Unit
2,082,574,771* Callon
28
336,130,696
630,097,196
Grallon
359,190,892
94,662,490
Grailon
(import quota
filled)
150,868,343
Grallon
(import quota
filled)
1,500,000
Grallon
665,663
3 3
-
FOR I M S D I A T E RELEASE
October 6. 1942._____
The Bureau of Customs announced today preliminary figures showing the quan
tities of coffee authorized for entry for consumption under the quotas for the
twelve months commencing October 1, 1941, provided for in the Inter-American
Coffee Agreement, proclaimed by the President on April 15, 1941, as follows:
Country of Production
Signatory Countries:
Brazil
Colombia
Costa Rica
Cuba
Dominican Republic
Ecuador
El Salvador
Guatemala
Haiti
Honduras
Mexico
Nicaragua
Peru
Venezuela
Quota Quantity
(rounds
) \/
1,821,836,025
617,483,151
39,185,707
15,726,029
23,523,302
29,415,140
123,781,103
104,900,424
53,868,211
4,191,694
96,438,728
40,893,390
4,897,122
57,080,665
Non-signatory countries:
British Empire, except
Aden and Canada
22,976,474
Kingdom of the Netherlands
and its possessions
25,570,406
Aden, Yemen, and Saudi
Arabia
5,034,821
Other countries not signa
tories of the Inter-American
Coffee Agreement
15,959,761
y
2/
Authorized for Entry
_______ for consumption_______
As of
(Date)
: (Pounds)
Sept. 26, 1942
n
2/
Sept. 30, 1942
Sept. 26, 1942
(Import Quota filled)
Sept. 30, 1942
2/
Sept. 26, 1942
Sept. 30, 1942
2
j
"
2/
(Import quota filled)
Sept. 26, 1942
it
Sept. 30, 1942
2/
(Import quota filled)
6 ,662,206
19,626,160
89,324,606
92,846,287
40,769,477
44,092,648
32,424,897
3,323,998
(Import quota filled)
(Import quota filled)
(Import quota filled)
(Import quota filled)
Quotas revised effective February 26, 1942, and July 16, 1942.
Per telegraphic reports.
■ 0O0-
945,537,073
512,966,541
32,134,247
|
J
TREASURY DEPARTMENT
Washington
POE IMMEDIATE RELEASE
Friday«/Octobor.
Pross Servico
Ho* 33-57
9. 1942
The Bureau of Customs announced today preliminary figures showing the quan
tities of coffee authorized for entry for consumption under the quotas for the
twelve months commencing October 1, 1941, provided for in the Inter-American
Coffee Agreement, proclaimed by the President on April 15, 1941, as follows?
Country of Production
Signatory Countries?
Brazil
Colombia
Costa Rica
Cuba
Dominican Republic
Ecuador
El Salvador
Guatemala
Haiti
Honduras
Mexico
Hicaragua
Peru
Venezuela
:
Quota Quantity
(Pounds) i j
1,821,836,025
617,483,151
39,185,707
15,726,029
23,523,302
29,415,140
123,781,103
104,900,424
53,868,211
4,191,694
96,438,728
40,893,390
4,897,122
57,080,665
Hon-signatory countries?
British Empire, except
Aden and Canada
22,976,474
, Kingdom of the Netherlands
and its possessions
25,570,406
Aden, Yemen, and Saudi
Arabia
5,034,821
Other countries not signa
tories of the Inter—American
Coffee Agreement
15,959,761
1/
2/
Authorized for Entry
for consumption
As of
(Date)
? (Pounds)
Sept. 26, 1942
n
Sept. 30, 1942
2/
Sept. 26, 1942
(Import Quota filled)
Sept. 30, 1942
2/
Sept, 26, 1942
Sept. 30, 1942
2/
»
2/
(Import quota filled)
Sept. 26, 1942
ii
Sept. 30, 1942
2/
(import quota filled)
(Import quota filled)
(Import quota filled)
(import quota filled)
(Import quota filled)
Quotas revised effective February 26, 1942, and July 16, 1942*
Per telegraphic reports#
-oOo-
945,537,073
512^966j541
32,134,247
6,662,206
19,626,160
89,324,606
92,846,287
40,769,477
44,092,648
32'424,'897
3,323,998
COTTON CARD STRIPS, COMBER WASTE, LAP WASTE, SLIVER WASTE, AND ROVING WASTE,
WHETHER OR NOT MANUFACTURED OR OTHERWISE ADVANCED IN VALUE. Annual quotas
commencing September 20, by Countries of Origin:
1
Total quota, provided, however, that not more than 33-1/3 percent of the
quotas shall be filled by cotton wastes other than card strips 2/ and comber
wastes made from cottons of 1-3/16 inches or more in staple length in the
case of the following countries: United Kingdom, France, Netherlands,
Switzerland, Belgium, Germany and Italy:
|
(In Pounds)
Country of
Origin
:
:
•
•
Established
TOTAL QUOTA
TOTAL IMPORTS
Sept. 21, 19l*2
to Sept 26,
United Kingdom..., ... ¡*,323,1*57
Canada........... ...
239,690
France........... ...
227,1*20
British India....
69,627
Netherlands..... ...
68,21*0
Switzerland.
...
là,388
Belgium..........
38,559
Japan............ ..
3ltl,535
China............
17,322
Egypt.............
8,135
Cuba.... .........
6,SI*1*
Germany........... ..
76,329
Italy...... ......
21,263
Total
5,1*82,509
±9k2
81,1*95
61,823
—
—
-
-
: Established
: 33-1/3* Of
: Total Quota
Imports Sept.
21, 191*2 to
Sept. 26, I9it2 1/
1,1*1*1,1S2
-
75,807
—
22,71*7
H*,796
12,853
—
—
-
-
25,U*3
7,088
11*3,318
1 ,599,886
_
mm
mm
4
-
4
_
—
-
1/ Included in total imports, column 2.
2/ The Presidents proclamation, signed March 31, 19U2, exempts from import quota
restrictions card strips made from cottons having a staple 1-3/16 inches or more
in length.
<
-0O01
(
FOR IMMEDIATE RELEASE,
October 8, 19U2______
J
J <?r
The Bureau of Customs announced today that preliminary reports from the col
lectors of customs show imports of cotton and cotton waste Chargeable to the
import quotas established by the Presidents proclamations of September £, 1939,
and December 19, 19li0, as follows, during the period September 21, 19^2, to
September 26, 19U2, inclusive:
—
COTTON HAVING A STAPLE OF LESS THAN 1-11/16 INCHES (OTHER THAN HARSH OR ROUGH
COTTON OF LESS THAN 3 / k INCH IN STAPLE LENGTH AND CHIEFLY USED IN THE MANUFAC
TURE OF BLANKETS AND BLANKETING, AND OTHER THAN LINTERS)• Annual quotas
commencing September 20, by Countries of Origin:
(In Pounds)
Country of
Origin
Egypt and the AngloEgyptian Sudan.... • •
Peru. ................. .
British India.........
China..................
Mexico............
Brazil.............
Union of Soviet
Socialist Republics.•
Argentina.... .
Haiti..................
Ecuador.... ...........
Honduras ..••••...... .
Paraguay........ ......
Colombia...............
Iraq......... .
British East Africa....
Netherlands East
Indies...... ........
Barbados...............
Other British West
Indies 1/.......... .
Nigeria.............. .
Other British West
Africa 2/. ...........
Algeria and Tunisia....
Other French Africa 3/*
Total
Staple length less
than 1-1/8«
•
• Imports Sept.
Established : 21, 19li2 to
Quota
: Sept. 26, 19li2
783,816
21*7,952
2,093,1*83
1,370,791
8,883,259
618,723
1*75,121*
5,203
237
9,333
752
871
121*
195
2,214-0
;Staple length 1-1/8 or more
: but less than 1-11/16”
:Established : Imports Sept.
:
Quota
: 21, 19l;2 to
*1*5,656,1*20
: Sept. 26, I9I42
9,933,751
1,022,882
21*7,952
8,883,259
618,723
-
mm
-
-
237
9,263
-
-
-
71,388
-
-
-
-
689
-
-
Hi,£16,882
9,759,1*31*
-
21,321
5,377
16,00U
-
1*5,656,1*20
U/
10,956,633
1/ Other than Barbados, Bermuda, Jamaica, Trinidad, and Tobago.
2/ Other than Gold Coast and Nigeria.
3/ Other than Algeria, Tunisia, and Madagascar.
h / Figures are shown by country of origin, although a «global11 quota was established
by Presidential proclamation on June 29, 19U2, effective July 29, 19^2.
TREASURY DEPARTMENT
Washington
FOR IMMEDIATE RELEASE,
Press Service
Tridas Qçtoboa? 9. 1942
No.
33-58
The Bureau of Customs announced today that preliminary reports from the col
lectors of customs show imports of cotton and cotton waste chargeable to the
import quotas established by the President1s proclamations of September 5, 1939,
and December 19, 191+0, as follows, during the period September 21, 191+2, to
September 26, 191+2, inclusive:
COTTON HAVING A STAPLE OE LESS THAN l-ll/l6 INCHES (OTHER THAN HARSH OR ROUGil
COTTON OE LESS THAN 3/1+ INCH IN STAPLE LENGTH AND CHIEELY USED IN THE MANUFAC
TURE OE BLANKETS AND BLANKETING, AND OTHER THAN LINTERS). Annual quotas
commencing September 20, by Countries of Origin:
____________________________________(in Pounds)__________
:
Staple length less
«Staple length 1 -1/8 or more
Country of
:________than 1-1/g”__________ t but less than l-ll/l6H
Origin
:
j Imports Sept, «Established : Imports Sept,
: Established : 21, 19^2 to
:
Qp.ota
: 21, I 9I+2 to
.______________
:
Q,uota
? Sept. 26, 19^2:^5,656,^20
t Sept, 26, 191+2
Egypt and the Anglo, Egyptian Sudan......
783,816
9*933,751
Peru..................
2^7,952
2^7,952
1,022,882
British India.........
2,003,1+83
China.................
1,370,791
Mexico................
S. 823,259
8,383,259
Brazil................
618,723
618,723
Union of Soviet
Socialist Republics*,
1+75» 12*+
Argentina.............
5,203
~
Haiti.................
237
237
Ecuador...........
9,333
9,263
Honduras...,..........
752
—
Paraguay.........
871
12l+
Colombia......
Iraq..................
195
British East Africa...,
2,2l+Q
Netherlands East
Indie s.,............
71*388
Barbados,.............
Other British West
21,321
Indies 1 /....
Nigeria..........
5*377
Other British West
Africa 2/.....
16,001+
Algeria and Tunisia....
—
Other Erench Africa ¿/. ________ 689_______________ Total____________ ll+,5l6,832_______9,759,1^
1/
2/
3/
5/
1+5,656,1+20 b j
10,956,633
Other than Barbados, Bermuda, Jamaica, Trinidad, and Tobago.
Other than Gold Coast and Nigeria,
Other than Algeria, Tunisia, and Madagascar.
Figures are shown by country of origin, although a "global'1 quota was established
by Presidential proclamation on June 29» 191+2, effective July 29» 191+2,
£ O K O T CARD STRIPS, COMBER WASTE, LAP WASTE, SLIVER WASTE, AND ROVING WASTE,
WHETHER OR NOT MANUFACTURED OR OTHERWISE ADVANCED IN VALUE. Annual quotas
commencing September 20, by Countries of Origins
Total quota, provided, however, that not more than 33~l/3 percent of the
quotas shall be filled by cotton wastes other than card strips 2/ and comber
wastes made from cottons of l~ 3/l6 inches or more in staple length in the
case of the following countriesi United Kingdom, France, Netherlands,
Switzerland, Belgium, Germany and Italyi
•
Country of
Origin
l
i
(in Pounds)
Established: TOTAL IMPORTS
i Established
TOTAL QUOTA : Sept. 21, 1942
J 33-1/3# of
: to Sept. 26, 19U2S Total Quota
United Kingdom... ... % 323,^57
Canada. ••........
239,690
France...............
227,420
British India....,...
69,627
Netherlands..........
68,2U0
Swit zerland..........
44,388
Belgium..........
38,559
Japan.
...
3^1,535
China............<
17.322
Egyp t............
8,135
Cuba.......... ...
6,5Î4{Germany...........
76,329
Italy.
21,263
Total
J
1
5 ,1+82,509
t|
81,495
—
6l,823
».
•*
«
Inports Sept.
21, 1942 to
Sept.26,1942 1 /
1,441,152
.
75,607
22,747
ft
14,796
.
12,653
mm
timÊi
*
••
—
-
25,443
7,088
143,318
1 ,599.886
mm
-
Included in total imports, column 2.
2/ The President’s proclamation, signed March 31» 1942, exempts from import quota
restrictions card strips made from cottons having a staple 1 -3/16 inches or more
in length.
TREASURY DEPARTMENT
Washington
FOR IMMEDIATE RELEASE,
Friday« October 9. 1942
Press Service
No.
33-58
The Bureau of Customs announced today that preliminary reports from the col
lectors of customs show imports of cotton and cotton waste chargeable to the
import quotas established by the President's proclamations of September 5» 1939*
and December 19* 19^0, as follows, during the period September 21, 19^2, to
September 26, 19^+2, inclusive:
COTTON HAVING A STAPLE OF LESS THAN 1-11/l6 INCHES (OTHER THAN HARSH OR ROUGH
COTTON OF LESS THAN 3/1+ INCH JN STAPLE LENGTH AND CHIEFLY USED IN THE MANUFAC
TURE OF BLANKETS AND BLANKETING, AND OTHER THAN LINTERS). Annual quotas
commencing September 20, by Countries of Origin:
(in Pounds)
Staple length less
iStaple length 1-1/8 or more
than 1-1/S'
:
: but less than 1-11/l 6"
:
î Imports Sept.. ¡Established : Imports Sept.
Established : 21, 19^2 to
:
Qiota
: 21, 19U 2 to
Quota
: Sept. 26, 19^2:U5,656,^20
: Sept. 26, 191+2
Country of
Origin
Egypt and the AngloEgyptian Sudan.......
Peru...................
British India..........
China.... ...... .......
Mexico.................
Brazil.................
Union of Soviet
Socialist Republics.♦
Argentina......... .
Haiti..................
Ecuador................
Honduras....... .
Paraguay...............
Colombia*
Iraq...................
British East Africa....
Netherlands East
Indies...............
Barbados....... .
Other British West
Indies 1 .... .
Nigeria............... .
Other British West
Africa 2/............
Algeria and Tunisia....
Other French Africa ¿/.
J
Total
J
*
/
U ul
i
t
/T
v
/
i
l
c
i
l
l
U
p
.
C
L
OS 9
783,816
-
2^7.952
2,003,1+83
1*370,791
8,383,259
618,723
2^7.952
H 75.12U
5,203
237
9,333
752
871
12U
195
2,21+0
618,723
9,933,751
1,022,882
«
«
—
-
-
«
-
8,883,259
237
9,263
-
-
-
-
71.3S8
-
«
-
21,321
-
-
5.377
-
-
16,001+
689
-
-
ll+,516,882
9.759.^
.
o
c
3ru
l
l
X
v
X
c
lJ
Uc
t
U
l
c
l
XC
B
.p
Xa X
X
i
X
Q
.
&
,
ü
.
p
1+5,656,1+20 k j
10,956.633
c
l
X
l
v
X lO Ua^U •
2/ Other than Gold Coast end Nigeria,
3/ Other than Algeria, Tunisia, and Madagascar.
4/ Figures are shown by country of origin, although a "global" quota was established
by Presidential proclamation on June 29» 19^-2, effective July 29» 19*+2.
~ 2 -
COTTON CARD STRIPS, COMBER WASTE, LAP WASTE, SLIVER WASTE, AND ROVING WASTE,
WHETHER OR NOT MANUFACTURED OR OTHERWISE ADVANCED IN VALUE. Annual quotas
commencing September 20, by Countries of Origin?
Total quota, provided, however, that not more than 33- 1/3 percent of the
quotas shall be filled by cotton wastes other than card strips 2/ and comber
wastes made from cottons of I- 3/16 inches or more in staple length in the
case of the following countries: United Kingdom, France, Netherlands,
Switzerland, Belgium, Germany and Italy:
______________ (in Pounds)
Country of
Origin
Established: TOTAL IMF0RT3
J Established
TOTAL QUOTA: Sept. 2 1 , 19I42
: 33-1/3$ 0f
: to Sept. 26, 19U2: Total Quota
United Kingdom...... ^.323.^57
Canada............
239,690
France.......... t..t
227,1+20
British India..... .
69,627
Netherlands........
68,21)0
Switzerland...... ..
1+1),388
Belgium.............
38,559
Japan..... ......11t
3^1,535
China............. r
17.322
Egypt.... ..........
Cuba
6,51+1+
Germany............f
76,329
Italy.
21,263
Total
_________
1,1411,152
SX, If95
61,823
12,853
■ -
«
— .
—
—
—
-
25,1+1+3
7.088
5 ,1+82,509
1/ Included in total imports, column
y
75.307
22,71+7
11+.796
-
Imports Sept.
21, 19U2 to
Sept.26,191*2
143,31s
1.599.886
- >~
2.
2/ The Presidents proclamation, signed March 31, 191*2, exempts from
iinport quota
restrictions card strips made from cottons having a staple I-3/16
inches or more
in length.
-
2-
COTTDN CARD STRIPS 2/, COMBER WASTE, LAP WASTE, SLIVER WASTE, AND ROVING WASTE
WHETHER OR NOT MANUFACTURED OR OTHERWISE ADVANCED IN VALUE. Annual quotas *
commencing September 20, by Countries of Origins
Total quota, provided, however, that not more than 33-1/3 percent of the
quotas shall be filled by cotton wastes other than card strips 2/ and
comber wastes made from cottons of 1-3/16 inches or more in staple length
in the case of the following countries: United Kingdom, France, Netherlands
Switzerland, Belgium, Germany and Italy*
Country of
Origin
United Kingdom.....
Canada.............
France.............
British India.... .
Netherlands.......
Switzerland.......
Belgium............
Japan........... .
China..............
Egypt..............
Cuba...............
Germany............
Italy.......... ., #.
Established s■ r o r f r a T
s Established î Imports Sept.
TOTAL QUOTA : Sept. 20, 191*1, 1 33-1/3$ of ! 20, 191*1, to
•
• to
Sept. 19,191*2 s Total Quota : Sept. 19,19l*2
1*,323,1*57
239,690
227,1*20
231,613
69,627
69,627
68,21*0
1*1*,388
38,559
31*1,535
17,322
8,135
6,51*1*
l*3l*
—
—
—
—
1,1*1*1,152
i*3i*
—
75,807
22,71*7
11*,796
12,853
—
—
.
.
.
—
—
76,329
»
21,263
-
25,1*1*3
7,088
-
5,1*82,509
301,671*
1,599,886
1*31*
1/ Included in total imports, column 2.
2/ The President's proclamation, signed March 31, 191*2, exempts from import quota
restrictions card strips made from cottons having a staple 1-3/16 inches or
more in length.
1/
FOR IMMEDIATE RELEASE,
3
3 " \&/
September 30, 191+2.
The Bureau of Customs announced today that preliminary reports from the collec* P
tors of customs show imports of cotton and cotton waste chargeable to the import
||P
quotas established by the Presidents proclamation of September 5, 1939, modified
;
! ip
by the proclamations of December 19, 19U0, and June 29, 1 9 k 2 , during the period
1
I
September 20, 19i;l, to September 19, 19U2, inclusive, as follows!
im
IfV
llta
||#
COTTON HAVING A STAPLE OF LESS THAN 1-11/16 INCHES (OTHER THAN HARSH OR ROUGH
COTTON OF LESS THAN 3 / b INCH IN STAPLE LENGTH AND CHIEFLY USED IN THE MANU
FACTURE OF BLANKETS AND BLANKETING, AND OTHER THAN LINTERS). Annual quotas
commencing September 20, by countries of origin!
P
iip
(In Pounds)
Country of
Origin
Egypt and the AngloEgyptian Sudan.....
Peru...............
British India.......
China...............
Mexico.............
Brazil.............
Union of Soviet Socialist Republics........
Argentina...........
Haiti..............
Ecuador............
Honduras....... .....
Paraguay............
Colombia..... ......
Iraq...............
British East Africa....
Netherlands East
Indies............
Barbados.......... .
Other British West
Indies 1/........ .
Nigeria............
Other British West
Africa 2/... .....
Algeria and Tunisia....
Other French Africa 3/
Total
1/
2/
3/
5/
0
0
!
Staple length less
• Staple length 1-1/8" or
i
than, 1-1/8"
!more but less than 1-11/16»
t Imports Sept. |
:
: Imports Sept. •
•
!Established i 20, 1 9 h l , to i Established ; 20, 19Ul, to
i Quota
! Sept. 19, 19U2 s
Quota
! Sept. 19, I9I4.2
■. .
0
783,816
21*7,952
2,003 ,¿183
1,370,791
8,883,259
618,723
1*75,12I*
5,203
237
9,333
752
-
2l*7,952
70,261*
—
8,883,259
618,723
U3,1*51,566
2,056,299
6U,9U2
2,626
_
3,808
1*2,295,1*22
3,122,300
li35
506
_
6
_
203
2
9,333
$
ioJP
: iritis
;Siina.
196,930
3
¡£¿00
Srazil
' lion
i ist
tmm
mm
JM il*
mmm
iric
Win
M
871
12k
195
2,2I4.O
71,388
—
_
—
-
—
—
21,321
—
30
5,377
16,001;
111,516,882
30,139
-
9,829,766
Ip.,799
12
2,002
1 ,63!;
-
689
29,909
1*5,656,1*20 y
jj
_
—
1*5,656,1*20
Ind
to
to
M
to
ifri
%r:
to
Other than Barbados, Bermuda, Jamaica, Trinidad, and Tobago.
Other than Gold Coast and Nigeria.
Other than Algeria, Tunisia, and Madagascar.
11/0
Figures are shown by country of origin, although a '’global11 quota was established h
by Presidential proclamation of June 29, 19^2, effective July 29, 19^2.
;|o
|j/?
e
TREASURY DEPARTMENT
Washington
FOR EAEDIATE RELEASE,
Friday. October 9y .19A2
PRESS SERVICE
No. 33-59
The Bureau of Customs announced today that preliminary reports from the
collectors of customs show imports of cotton and cotton waste chargeable to
the Import quotas established by the President’£3 proclamation of September 5,
1939, modified by the proclamations of December 19, 1940, and June 29, 1942,
during the period Sept ember 20, 194-1, to September 19, 1942, inclusive, as
follows:
COTTON HAVING A STAPLEiOr LESS THAI 1-11/16 INC!ES (OTHER THAN M RSI! OR ROUGH
COTTON OF LESS THAN 3/4 INCH IN STAPLE LENGTH AND CHIEFLY USED IN TIE MANUFACTURE OF BLANKETS AND BLANKETING, AND OTHER THAN LINT2RS). Annual quotas
commencing September 20, by countries of origin:
(In Pounds)
:
Staple 1ength 3.0ss
: Staple IcrLgth 1-1/8» or
•
than 1-1/8»
:more but lesis than 1-11/16»
•
Country of
: Imports Sept. :
:Imports Sept.
Origin
¿Established : 20, 1941, to : Established: 20, 1941, to
: Quota
: Sent. 19. 1942:
Quota
îScpt. 19, 1942
Egypt and the AngloEgyptian Sudan....
783,816
43,451,566
42,295,422
Peru.............. .
247,952
247,952
3,122,300
* 2,056,299
—
British India....... . 2,003,403
64,942
70,264
—
China........ ..... . 1,370,791
—
2,626
—
Mexico.......... . . 8,883,259
196,930
8,883,259
Brazil........... .. .
3,808
618,723
618,723
3
Union of Soviet Social
—
—
ist Republics....... .
475,124
—
Argentina...... ••••• .
5,203
203
435
Haiti......... .....
/C
506
6
237
Ecuador............
9,333
9,333
Honduras....... .
752
Paraguay.
..
871
—
—
—
Colombia....... .... .
124
—
—
—
Iraq.
195
—
British East Africa... .
2,240
41,759
29,909
Netherlands East
—
—
—<
Indies............ .
71,308
—
—
Barbados. ..-•••.. .....•.•
—
12,554
Other British West
—
—
Indies l/........... .
21,321
30,139
—
—
Nigeria........
30
«
5,377
Other British West
—
—
Africa 2/........... .
2,002
16,004
—
—
Algeria and Tunisia... •
1,634
—
—
Other French Africa ¿/
689
•
—
—
—
—
—
—
—
—
—
—
—
Total
1/
2/
3/
14,516,882
9,829,766
45,656,420
t j
45,656,420
Other than Barbados, Bermuda, Jamaica, Trinidad, and Tobago.
Other than Gold Coast and Nigeria.
Other than Algeria, Tunisia, and Madagascar.
¿¡J Figures are shown by country of origin, although a »global” quota was
established by Presidential proclamation of June 29, 194-2, effective
July 29, 1942.
COTTON CARD STRIPS 2/, COMBER WASTE, LAP WASTE, SLIVER WASTE, AND ROVING
WASTE, WHETHER OR NOT MANUFACTURED OR OTHERWISE ADVANCED IN VALUE.
Annual quotas commencing September 20, by Countries of Origin:
Total quota, provided, however, that not more than 33-1/3 percent of the
quotas shall be filled by cotton wastes other than card strips 2/ and
comber wastes made from cottons of 1—3/16 inches or more in staple
length in the case of the following countries: United Kingdom, France,
Netherlands, Switzerland, Belgium, Germany and Italy:
____________________________
(In Pounds)
_______________
:
:TOTAL IMPORTS Established:Imports Sept.
Country, of
: Established :Sept. 20, 1941,t 3 3 ^ l/3 % of :20, 1941, to
O r i g i n ______ : TOTAL QUOTA :to Sept. 19.1942:Total Quota:Sept,19. 1942 1/
United Kingdom.•• A,323,4-57
1,441,152
434
434
Canada..........
239,690
231,613
France.... .
_
—
227,420
75,807
British India....
69,627
69,627
_
Netherlands•••••.
68,240
—
22,747
—
Switzerland.....
44,388
14,796
Belgium.........
—
38,559
12,853
Japan......... .
—
~
—
341,535
—
—
China..... .
17,322
_
Egypt...........
—
—
8,135
Cuba
6,544
—
Germany..........
—
76,329
25,443
Italy,,.,........
—
21.263
7.088
1,599,836
5,482,509
301,674
434
M
-
_
1/ Included in total imports, column 2.
2 / The Presidents proclamation, signed March 31, 1942, exempts from import
quota restrictions card strips made from cottons having a staple
1-3/16 inches or more in length.
lESASUHT DSPARÎMENt
Washington
FOR RELEASE, MORNING NEWSPAPERS
Saturday. October IO. 1942.
Press Sendee
3--S
the Secretary of the Treasury announced last evening that the tenders for
$400,000,000, or thereabouts, of 91-day treasury bills to be dated October
14, 1942
and to nature January 13, 1943, which were offered on October 7, were opened at the
Federal Reserve Banks on October
9.
the details of this issue are as follows!
pw
total applied for - #713,102,000
total accepted
- 400,433,000
Range of accepted bids:
High
Low
Average price
- 99*924 Equivalent rate of discount approx. 0.301$ per annua
- 99.905
■
*
o.376$ «
«
* 99*906
*
n
n
n
n
0.373$ *
8
(43 percent of the amount bid for at the low price was accepted.)
a
D
o
Aï(
- y
TREASURY DEPARTMENT
Washington
FOR RELEASE, MORNING NEWSPAPERS,
Saturday, October 10, 1942,_____
9/9/42
Press Service
No. 33-60
The Secretary of the Treasury announced last evening that the
tenders for $400,000,000,
or thereabouts,
of 91-day Treasury bills
to be dated October 14, .1942, and to mature January 13» 1943» which
were offered on October 7, were opened at the Federal Reserve Banks
on October 9.
The
details of this issue are as follows:
♦
Total applied for - $713,102,000
Total accepted
- 400,438,000
Range of accepted bids:
High
- 99*924 Equivalent rate of discount approx. 0.301$
per annum
- 99.905 Equivalent rate of discount approx. 0.376$
■ L'ow
per annum
Average - 99.906 Equivalent rate of discount approx. 0,373$
per annum
price
(48 percent of the amount bid for at the low price was accepted.)
«3 " S ' 6 /
FOR IMMEDIATE RELEASE,
October^. 194.2.
fi
{fili
The Bureau of Customs announced today preliminary figures showing the quantitles of wheat and wheat flour entered, or withdrawn from warehouse, for con-
i fi
sumption under the import quotas established in the President's proclamation of
te
May 28, 1941, as modified by the President's proclamation of April 13, 1942, for
j|t!!
the twelve months commencing May 29 , 1942, as follows:
i|ifi
Country
of
Origin
Canada
China
Hungary
Hong &ong
Japan
United Kingdom
Australia
Germany
Syria
New Zealand
Chile
Netherlands
Argentine
Italy
Cuba
France
Greece
Mexico
Panama
Uruguay
Poland and Danzig
Sweden
Yugoslavia
Norway
Canary islands
Rumania
Guatemala
Brazil
Union of Soviet
Socialist Republics
Belgium
:
Wheat flour, semolina.
litie
:crushed or cracked wheat, and
WHEAT
:
similar wheat oroduets
:
Imports
t
CBaportsVi
Established : May 29, 1942 to : Established :May 29, 1942 to h f
*
: Sent. 26. 1942 :
Quota
Quota
»Sent. 26. 1942
(Bushels;
(Bushels)
(Pounds)
(Pounds)
0
795,000
100
100
100
795,000
—
-
-
-
—
—
100
2,000
100
1,000
100
—
1,000
100
100
-
*•
100
100
800,000
—
795,000
—
—
-
3,8X5,000
24,000
13,000
13,000
8,000
75,000
1,000
5,000
5,000
1,000
1,000
1,000
14,000
2,000
12,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
-
.—
4,000,000
3,804,623
-
m»
-
mada
j 'lina
igaiy
fio
.fai
1 ;litei
«trai
»
■mi
—
'■ria
«
nZea
44
die
iteri
« .
.igeiti
,.a!y
- ■
ita
•
lice
lece
nico
i
-
1 «lay
jlaii
redea
igeala
inay
I
8 inaiy
ifinii
■latemg
izil
__ I ¡icn
3,804,667
< Soc
kk
-oOo~
TREASURY DEPARTMENT
Washington
EOR IMMEDIATE RELEASE;
Saturday, October 10, 1942
Press Service
Ho. 33-61
The Bureau of Customs announced today preliminary figures showing the quan
tities of wheat and wheat flour entered, or withdrawn from warehouse, for con
sumption under the import quotas established in the President’s proclamation of
May 28, 1941, as modified by the President’s proclamation of April 13, 1942, for
the twelve months commencing May 29, 1942, as follows:
Country
of
Origin
Canada
China
Hungary
Hong Kong
Japan
United Kingdom
Australia
Germany
Syria
New Zealand
Chile
Netherlands
Argentine
Italy
Cuba
Prance
Greece
Mexico
Panama
Uruguay
Poland and Danzig
Sweden
Yugoslavia
Norway
Canary Islands
Rumania
Guatemala
Brazil
Union of Soviet
Socialist Republics
Belgium
WHEAT
:
Imports
Established : May 29, 1942 to
Quota
: Sent. 26. 1942
(Biishels)
(Bushels)
795,000
795,000
-
-
-
—
100
100
100
-
—
~
-
-
100
2,000
100
-
—
-
-
1,000
100
—
-
~
—
-
-
—
-
-
-
-
-
-
-
1,000
100
100
100
100.
800,000
Wheat flour, semolina,
crushed or cracked wheat,
and similar wheat nroducts
:
Imports
Established :May 29, 1942 tc
Quota
:Sent. 26.1942
(Pounds)
(Pounds)
3,815,000
24,000
13,000
13,000
8,000
* 75,000
1,000
5,000
5,000
1,000
1,000
1,000
14,000
2,000
12,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
3,804,623
—
_
M
*
M
.
—
—
44
*
*
—
—
_
—
—
—
—
—
•
*
_
-
—
_
-
-
-
795,000
4,000,000
3,804,667
TREASURT DEPARTBBKT
Kuhlngton
POR M E D I A T E RELEASE,
E s » a Serri e.
Partir..Ut
o 33^ v
Secretary of thè Treaeury Morgenthau today announced thè subscription
figure« and thè ha«!« of allotaent for thè eash offering of 2 percent
Treasury Benda of 1950-52 and of 1-1/2 percent Treasury Notes of Serie«
B-1946.
Preliminar^ reporte received fra* thè Federal Reserve Bank« show that
total «ubaerlptloxia for hoth leene« aggregate approxiaately 1^/00,000,000,
of vhleh atout 25 peroent carne fren «ourcee other than tank« whioh accept
deaand deposita*
All subscrlptions «ere allotted in full.
*he reporta indicate that eubserlptlone «ere quite evenly dirided
between thè tuo leene«*
fhrther detalle a« to «ubacriptiona and allotaent« «ili be announced
«ben final reporta are reeeived froa thè Federal Reserve Bank«.
TREASURY DEPARTMENT
Washington
FOR IMMEDIATE RELEASE,
Monday, October 12, 19*12,
Press Service
No. 33~62
Secretary of the Treasury Morgenthau today announced the
subscription figures and the basis of allotment for the cash
offering of 2 percent Treasury Bonds of 195°-52 and of 1-1/2 per
cent Treasury Notes of Series B-19^6.
Preliminary reports received from the Federal Reserve Banks
show that total subscriptions for both issues aggregate approxi
mately #*1,100,000,000, of which about
25 percent came from sources
other than banks which accept demand deposits *
All subscriptions
were allotted In full.
The reports indicate that subscriptions were quite evenly
divided between the two issues.
Further details as to subscriptions and allotments will be
announced when final reports are received from the Federal Reserve
Banks,
-oOo-
5
3
- 6
3
FOE IMMEDIATE RELEASE,
October
194.2.
The Bureau of Customs announced today that the quota of 3,815,000
pounds for wheat flour, semolina, crushed or cracked wheat, and simi
lar wheat products (other than wheat flour unfit for human consumption),
the produce of Canada, which may be entered for consumption or with
drawn from warehouse for consumption during the
1 2 months* period be
ginning May 29, 194-2, established by the President*a Proclamation of
May 28, 194-1» has been filled*
TREASURY DEPARTMENT
Washington
FOR IMMEDIATE RELEASE, .
Monday, October 12, 1942»
' : Press Service
No. 33-63
The Bureau of Customs announced today that the quoth
of 3 ,^15,0 0 0 pounds for wheat flour, semolina, crushed or
cracked wheat, and similar wheat products (other 'than wheat
flour unfit for human consumption), the-produce of Canada,
which may be entered for consumption or withdrawn from ware
house for consumption during the 12 months’ period begin
ning May 29, 1942, established by the President’s Procla
mation of May 28, 1941, has been filled.
-oOo
2
Scores of letters hav e been r e c e i v e d at t he M i n t offices
f r o m citizens r e p o r t i n g t h e y w e r e c o n v e r t i n g t h e i r coin s a v
ings into W a r Stamps a n d Bonds,
b u t Mrs. R o s s says t h e movement
a p p a r e n t l y has y e t to gain s u f f i c i e n t m o m e n t u m to ease the
s t r a i n on c o i nage establishments,
o r to a id s u b s t a n t i a l l y in
r e l e a s i n g metals for w a r purposes.
S h o r t a g e of materials,
operations
th e stra i n of prolongest capac i t y
on m a c h i n e r y a n d personnel,
o f h i g h l y s k i l l e d employees
a n d loss o f hundreds
en t e r i n g th e A r m e d Se r v i c e s or g o
ing into w a r plants a l l hav e c o n t r i b u t e d to th e u r g e n c y of the
p r o g r a m to p u t the o u t s t a n d i n g c oin stocks to work.
M i n t in September,
q u a r t e r dollars,
i n c l u d i n g 7 , 1 5 5 , 3 0 9 h a l f dollars,
3 9 , 8 41,509 dimes,
and
15,153,509
5 9 ,0 8 6 ,5 0 0 pennies.
P e a k p r o d u c t i o n of r e c e n t m o n t h s was in May,
j
with
1 7 3 ,7 6 3 , 4 1 8 p i e c e s of w h i c h m o r e than 1 1 9 ,0 0 0 ,0 0 0 w e r e pennies.
S u s p e n s i o n o f c o i nage o f 5-ce n t piec e s in r e c e n t months,
p r e p a r a t i o n s were m a d e f or u s e of a n e w alloy,
in c o i n a g e figures.
coins,
The a l l - t i m e p e a k month,
was last December,
h a v i n g a v a l u e of $ 1
with production of
while
is r e f l e c t e d
in n u m b e r of
2 4 7 ,1 5 2 , 4 9 2 pieces
1 ,6 0 3 ,0 2 0 .1 0 .
jj
P r o d u c t i o n o f the n e w Hn i c k e l - l e s s n i c k e l ” n o w is u n d e r
way.
It is c o m p o s e d o f silver,
c o p p e r a n d manganese,
permit
ting s u b s t a n t i a l savings \for w a r u s t ^ o f n i c k e l a n d copperTf
B ut the big w o r r y n o w is t he s u p p l y of pennies.
The lowly
”c o p p e r ” a c t u a l l y is p e r h a p s the R a t i o n * s m o s t u s e f u l coin.
the 150 y e a r s of M i n t operations,
h a v e b e e n produced,
of w h i c h
In
(
m ore tha n 19 b i l l i o n coins
on e - c e n t piece s|
)
.
A
<-yv°
/
i f
33'
ing to c o n s e r v e v i t a l war
*
i
f o n e - c e n t p i e c e s by 50 per-
S&)
<X -^jEL-^-rvf"
<1\A-C>~dL.fl.
.ofroofr-be4 ay ^8hewed.
3
iiiP#
)/L,
irising^from t h e h i g h level
i j ^
fa
r ecedented rate,
seriously
ogram.
¡ptember w a s
59 m i l l i o n pieces,
fc onl y a b o u t h a l f t h e proer.
i r e c t o r o f the Mint, r e n e w e d
pnft~&u3f
ipecially pcnni-ca ^ n o w M hi din g ”
receptacles^ be r e t u r n e d to c ir
culation.
Sh e p o i n t e d o u t t h a t i f e ach of an
A m e r i c a n families
est i m a t e d 33
^° j O“^
s h o u l d d i s c o v e r an d r e t u r n to u se
just t e h ^ pepj«t ?07 a n d these s h o u l d stay in circulation,
the
N a t i o n 1s s u p p l y w o u l d be i n c r e a s e d b y an a m o u n t e q ual to onet h i r d of the r e c o r d 1 941 p r o d u c t i o n of t h e coin.
M o r e than
■
1,000
I
t ons o f c o p p e r m i g h r ^ b e s a v e d for w a r m a n u f a c t u r e .
The D i r e c t o r c i t e d a s t o r y in a s o u t h w e s t e r n n e w s p a p e r
as an
example.
J^A t h r e e - y e a r o l d child t u r n e d in
nies in t h e p u r c h a s e of a W a r Bond,
t h a t the l i t t l e g i r l h a d
n e x t one.
Mrs.
1 ,8 7 5 pen
a n d the s t ory r e p o r t e d
50 0 m o r e p e n n i e s s a v e d t o w a r d the
Ross said she was g r a t i f i e d by the r e t u r n
of t h e coins to a c t i v e duty,
b u t she w i s h e d the y o u n g s t e r
h a d p u r c h a s e d W a r Sa v i n g s Stamps w i t h the other 500.
vJ
A&M
It!
0 *
3
T he U n i t e d States Mint,
metal,
A® '
4^
s e e k i n g to c o n s e r v e v i t a l war
has c u r t a i l e d p r o d u c t i o n o f o n e - c e n t p i e c e s by
cent in r e c e n t months,
«<L
3
-figuroc role^tiod "te day
ip
50 per-
h ew e d .
pi ^L*-V
^^However,
of business,
d e m a n d for coins,
a r i s i n g <?f r o m t h e h i g h level
continues at an u n p r e c e d e n t e d rate,
seriously
t h r e a t e n i n g this c o n s e r v a t i o n program.
P r o d u c t i o n o f p e n n i e s in S e p t e m b e r w a s
1
a m o d e r a t e r i s e over August,
59 m i l l i o n pieces,
b u t only a b o u t h a l f t he p r o
d u c t i o n l e v e l of the early summer.
Mrs.
N e l l i e T a y l o e Ross,
h e r p l e a that a l l coins,
D i r e c t o r o f the Mint,
renewed
b u t e s p e c i a l l y ficnni-ca^n o w "h i d i n g ”
in c h i l d r e n * s b a n k s a n d o t h e r receptacles^ be r e t u r n e d to ci r
culation.
S he p o i n t e d o u t t h a t i f eac h of an
iflfoili!Wi A m e r i c a n famil ies
es t i m a t e d 33
s h o u l d d i s c o v e r a nd r e t u r n to use
just t e h ^ pejejareffT a n d these s h o u l d stay in circulation,
the
N a t i o n 1s s u p p l y w o u l d be i n c r e a s e d b y a n a m o u n t e q u a l to onet h i r d of the r e c o r d 1 941 p r o d u c t i o n o f t h e coin.
M o r e than
1 ,0 0 0 ton s o f c o p p e r m i g h ^ b e s a v e d for w a r m a n u f a c t u r e ^ pM*
The D i r e c t o r c i t e d a s t o r y in a s o u t h w e s t e r n n e w s p a p e r
as an
example.
\x t h r e e - y e a r o l d child t u r n e d in 1 , 8 7 5 p e n
nies in t h e p u r c h a s e of a W a r Bond,
t h a t the l i t t l e g i r l h a d
n e x t one.
Mrs.
a n d the s t o r y r e p o r t e d
50 0 m o r e p e n n i e s s a v e d t o w a r d the
Ross said she was g r a t i f i e d by the r e t u r n
of t h e coins to a c t i v e duty,
b u t she w i s h e d the y o u n g s t e r
h a d p u r c h a s e d W a r S a v ings Stamps w i t h the other 500.
0“**
TREASURY DEPARTMENT
Washington
FOR I M M E D I A T E RELEASE,
Tuesday, O c t o b e r 13, 1942,
T he U n i t e d S t ates Mint,
P r e s s S e rvice
No, 33-64
s e e d i n g to co n s e r v e vital wa r metal,
has c u r t a i l e d p r o d u c t i o n of o n e -cent p i e c e s by
recent months,
5 0 percent in
a c c o r d i n g to a report m a d e to S e c r e t a r y M o r g e n t h a u
today,
However, dema n d for coins, a r i s i n g f r o m the h i g h level of
business, continues at an u n p r e c e d e n t e d rate, ser i o u s l y t h r e a t e n
ing this c o n s e r v a t i o n p r o gram.
P r o d u c t i o n of p e n n i e s in S e p t e m b e r was 59 m i l l i o n pieces,
moderate ris e o v e r August, b ut o n l y about h a l f the p r o d u c t i o n
level of the e a rly summer.
a
Mrs. N e l l i e T a y l o e Ross, D i r e c t o r of the Mint, r e n e w e d he r
plea that all coins, b ut e s p e c i a l l y o n e - c e n t pieces n o w " h i d i n g “
in c h i l d r e n s banks and o t h e r receptacles, be r e t u r n e d to c i r c u
lation,
She p o i n t e d o u t that if e a c h of an e s t i mated 3 3 , 0 0 0 , 0 0 0
A m e rican families s h o u l d d i s c o v e r a nd r e turn to u s e Just ten onecent pieces, a nd these s h ould stay in circulation, the N a t i o n * s
supply w o u l d be increased b y an amount eaual to o n e - t h i r d of the
record 1941 p r o d u c t i o n of the coin,
M o r e tha n 1 * 0 0 0 tons of
copper m i g h t thus be s a v e d f o r war. m a n u facture, she said,
T h e D i r e c t o r c i t e d a story in a s o u t h w e s t e r n n e w s p a p e r as
an example,
A t h r e e - y e a r old c h i l d t u r n e d in 1 9S75 p e n n i e s in the pur*^
chase of a W a r Bond, a n d th e story r e p o r t e d that the little girl
had 500 mor e pennies s a v e d t o w a r d the next one.
Mrs. R o s s said
she was g r a t i f i e d by the r e t u r n of the coins to active duty, b ut
she w i s h e d the y o u n g s t e r h a d p u r c h a s e d Wa r S a v ings Stamps w i t h
the o t h e r 5 0 0 ,
Scores of letters h a v e b e e n r e c e i v e d at the Min t offices from
citizens r e p o r t i n g t h e y w e r e c o n v e r t i n g t h eir coin savings into
War Stamps and Bonds, but Mrs, R o s s says the mov e m e n t appa r e n t l y
has y et to gain s u f f i c i e n t m o m e n t u m to ease the strain on coinage
establishments, or to a i d s u b s t a n t i a l l y In r e l e a s i n g metals for
war purposes.
Shortage of materials, the strain of p r o l o n g e d capacity
operations o n m a c h i n e r y a nd personnel, a nd loss of hundreds of
highly skilled employees e n t e r i n g the A r m e d Se r v i c e s or g o i n g
- 2
-
into w a r p l a n t s all h a v e c o n t r i b u t e d to the u r g e n c y o f the p r o
gram to put the o u t s t a n d i n g coi n stocks to work.
N e a r l y # 1 2 , 0 0 0 , 0 0 0 w o r t h of coins was t u r n e d out b y the
Mint in September, I n c l u d i n g 7 # 1 5 5 » 3 ^ 9 half dollars, 1 5 » 1 5 3 # 5 0 9
quarter dollars, 3 9 » 8 k l ,5 0 9 dimes, a nd 5 9 # 0 8 6 ,5 0 0 pennies*
P e a k p r o d u c t i o n of recent m o n t h s was in May, w i t h
173» 7 6 3 #^18 p i e c e s of w h i c h m ore t h a n 1 1 9 , 0 0 0 ,0 0 0 wer e pennies.
Suspension of coinage of 5-°®ht p i eces in r e cent months, w h ile
preparations w ere made f o r u se of a n e w alloy, is r e f l e c t e d in
coinage figures.
Th e a l l - t i m e p e a k month, in n u m b e r of coins,
was last December, w i t h p r o d u c t i o n of 2 ^ 7 » 1 5 2 » ^ 9 2 p i eces h a v i n g
a value of # 1 1 ,6 0 3 ,0 3 0 .1 0 .V
P r o d u c t i o n of the n e w Mn i c k e l ^ l e s s n i c k e l “ n o w is underway.
It is c o m p o s e d of silver, c o p p e r and manganese, p e r m i t t i n g s ub
stantial savings of nickel a nd c o p p e r for w a r use.
But the b i g w o r r y n o w is the supply o f pennies.
T h e lowly
“c o p p e r 1* a c t u a l l y is p e r haps the N a t i o n * s m ost u s e f u l coin.
In
the 1 5 0 years of Mint operations, m ore tha n 19 b i l l i o n coins
have b e e n produced, of w h i c h almost eleven b i l l i o n were onecent pieces*
'
»
t
I
—0Qo**
TREASURY DEPARTMENT
FISCAL SERVICE
WASHINGTON
BUREAU OF ACCOUNTS
O FFICE O F TH E C O M M ISSIO N E R
October 7, 19^2.
During the month of September, the
following market transactions took place in
direct and guaranteed securities of the Gov
ernment;
S a l e s ............... 5 OO, 000
P u r c h a s e s ...........
Net sales
. . . .
-_____
$^,500,000
TREASURY" DEPARTMENT
Washington
FOR IMMEDIATE RELEASE,
Tuesday, -S-eptembor 15* 10 40.
Qdjr-t*' i -C I f f X
Press Service
Ho . Sô-fiô*
^
Market transactions in Government securities for Treasury
Investment and other accounts in AU®uSt7 l 9 4 2 # resulted in net
S 0 0 , Û * *>
sales of ^y44£».QjQ@, Secretary Morgenthau announced today.
-0O0-
TREASURY DEPARTMENT
Washington
FOR IMMEDIATE RELEASE,
Thursday, October 15» 19^-2»
Market
investment
net
sales
transactions
and
of
other
in
Press Service
No. 33-65
Government
accounts
$^,500,000,
in
September,
Secretary
-oOo-
securities
19^2,
Morgenthau
for
Treasury
resulted'
announced
in
today.
TREASURY DEPARTMENT
Washington
4<SR
POE IMMEDIATE RELEASE,
Presa
Thursday» October 15. 1942.
^ ^ ^M
The
Secretary of
the
and allotment
figures with
respect t o the
t o d s
of
Service
Treasury today announced the
1950-52 and of the additional
final
subscription
current offering of 2 percent Treasury
i s s u e o f 1 - 1 / 2 p e r c e n t T r e a s u r y K o t e s of
Series B-194&»
Subscriptions and allotments mere divided among the several
serve
Districts
and the Treasury as
F e d e r a l Re
felloes s
Federal Reserve
Treasury t o d s
T r e a s u r y Retes
D i s t r i c t _________
O f 1 9 5 0 - 5 9 -----
of
S e r i e s B-19A6
Total
Subscriptions
Total
Subscriptions
Received 1
•
Boston
Allotted
Received A
*
80,284*600
Allotted
109,968,800
862,971,700
Sew York
876,260,900
Philadelphia
101,933,200
93,138,000
Cleveland
99,916,600
109,789,800
Slehaond
00,838,300
79,482,900
Atlanta
88,697,900
Chicago
247,398,100
67,792,900
402,408,800
59 ,203,700
94,399,900
34,968,200
70,184,300
57,115,200
St,
Louis
Minneapolis
Kansas
99,944,300
74,564,100
91,352,200
159,214,700
143,586,000
City
Dallas
San Francisco
6.341.000
2.203.100
«.,960,789,000
#2,139,892,600
Treasury
TOTAL
•
0
O
o
/
/
treasury department
mi Seni«,
Washington
FOR I M M E D I A T E R E L E A S E
Thursday. October 1 ^, ’l9 li2 .
Press Service
No.
«tir#»
n .
rylteitf
Secretary of ,h. Tr.a.cry
subscription ,M
offering
r ns
„e
er
a
2
‘
Hot.»,
. « r e n t
„
r r c u r y
'-1 /2
Bona.
respect
1950„ 52
, f
>* ' - . c r y
to
„ „
the
^
current
. . . . . or
u scrtptlons and allotments were divide*
n
re d m d e d among the several
Federal Reserve Districts and the Tr.».
na tn® Treasury as follows:
•nrjrfeti
StriliM
Federal R e s e r v e
District
udii
362,571,7®
Boston
New York
Philadelphia
tt,7^
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas Cltv
Dallas
j *
m
33-66
San Francisco
.treasury
'
TOTAL
Treasury Bonds
of 1950-5?
Total Subscriptions
Received & A l l o t s
I
S0,28k,600
276 .260.500
101»9 3 3 , 2 0 0
95 ,9 1 6 ,6 0 0
80,833,300
8 8 .6 9 7 .5 0 0
2 iP7 , 3 9 S,loo
59,203,700
3 *P, 568,200
70,18^,300
5 9 , 9 ^ , 300
159,2 1 4,7 0 0
___ 6,3kl.000
1 1 7 5 5 0 ,7 ! < ,0 0 0
•O0o~
Treasury Notes
0?, Series B~ i q Ii£
Total Subscriptions
Received & Allotted
f
109 ,568,800
s6s, 571,700
93,133,000
105,789,800
75.482.500
67.752.500
**02,4og, goo
9^. 359,900
57.115.200
7 4 , 5 6 4 ,100
51.352.200
1 ^3 , 5 3 6 ,000
2 , 2 0 7 ion
^7139, 85^5155
m
- 3 -
issue or on subsequent purchase, and the amount actually received either
upon sale or redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss*
Treasury Department Circular No* 418, as amended, and this
notice, prescribe the terms of the Treasury bills and govern the condi
tions of their issue*
Copies of the circular may be obtained from any
Federal Heserve Bank or Branch*
0
o
*****
-
2
-
Reserve Banks and Branches, following which public announcement will be made
by the Secretary of the Treasury of the amount and price range of accepted
bids.
Those submitting tenders will be advised of the acceptance or rejec
tion thereof.
The Secretary of the Treasury expressly reserves the right
to accept or reject any or all tenders, in whole or in part, and his action
in any such respect shall be final.
Payment of accepted tenders at the
prices offered must be made or/completed at the Federal Reserve Bank in
cash or other immediately available funds on
October 21, 1942________,
£s$
The income derived from Treasury bills, whether interest or gain
from the sale or other disposition of the bills, shall not have any exemption,
as such, and loss from the sale or other disposition of Treasury bills shall
i
not have any special treatment, as such, under Federal tax Acts now or here
after enacted.
The bills shall be subject to estate, inheritance, gift, or
other excise taxes, whether Federal or State, but shall be exempt from all
taxation now or hereafter imposed on the principal or interest thereof by
any State, or any of the possessions of the United States, or by any local
taxing authority.
For purposes of taxation the amount of discount at which
Treasury bills are originally sold by the United States shall be considered
to be interest.
Under Sections 42 and 117 (a) (l) of the Internal Revenue
Code, as amended by Section 115 of the Revenue Act of 1941, the amount of
discount at which bills issued hereunder are sold shall not be considered
to accrue until such bills shall be sold, redeemed or otherwise disposed
J
of, and such bills are excluded from consideration as capital assets.
Accordingly, the owner of Treasury bills (other than life insurance comI
panies) issued hereunder need include in his income tax return only the
difference between the price paid for such bills, whether on original
V
TREASURY DEPARTMENT
W ashington
EOS. RELEASE, MORNING NEWSPAPMS,
Friday, October 16, 1942
The S e c r e t a r y of the treasury, "by this public notice, invites tenders
for $ 5QQ.QOQTQOO
« o r t h e r e a b o u ts , o f
^ 91 -d a y T re a s u ry b i l l s ,
on a discount basis under competitive bidding.
be d a te d
October 21. 1942
The Dills of this series will
and w i l l m ature — January 2 0 ^ 1943.
when th e f a c e amount w i l l be p a y a b le w ith o u t i n t e r e s t .
b e a r e r form o n ly , and in d en o m in ation s o f $ 1 ,0 0 0 ,
$ 5 0 0 ,0 0 0 ,
and $ 1 ,0 0 0 ,0 0 0
to be issued
They w i l l be is s u e d in
$ 5 , 0 0 0 , $ 1 0 ,0 0 0 , $ 1 0 0 ,0 0 0 ,
(m a tu r i ty v a l u e ) .
T en d ers w i l l be r e c e i v e d a t F e d e r a l R e s e rv e Banks and B ra n ch e s up to the
War
c l o s i n g h o u r, two o » c lo c k p . m ., E a s t e r n &tX2n&txnfo tim e ,
Monday,
, °ctcfoer 19» X9IA.i l
T en d ers w i l l n o t be r e c e i v e d a t th e T re a s u ry D ep artm en t, W ash in gton .
must be f o r an even m u ltip le o f $ 1 , 0 0 0 ,
and th e p r i c e o f f e r e d must be expressed
on th e b a s i s o f 1 0 0 , w ith n o t more th a n th r e e d e c im a ls , e . g . ,
may n o t be u s e d .
Each tender 1
9 9 .9 2 5 .
F ractio n s
I t i s u rg e d t h a t »ten d ers be made on th e p r i n t e d form s and fo r
w arded in th e s p e c i a l e n v e lo p e s w hich w i l l be su p p lie d by f e d e r a l R e se rv e Banks
o r B ra n ch e s on a p p l i c a t i o n t h e r e f o r .
T en d ers w i l l be r e c e i v e d w ith o u t d e p o s it from in c o r p o r a te d banks and
t r u s t com panies and from r e s p o n s ib le and re c o g n iz e d d e a l e r s in in v estm en t s e c u n - 1
tie s .
T unders ivorn o t h e r s must be accom panied by payment o f 10 p e r c e n t o f the
f a c e amount o f T re a s u ry b i l l s a p p lie d f o r , u n le s s th e te n d e r s a r e accompanied by
an e x p r e s s g u a ra n ty o f payment by an in c o r p o r a te d bank o r t r u s t company.
Im m ed iately a f t e r th e c l o s i n g h o u r, te n d e r s w i l l be opened a t the FederJ
3 3-6
7
G -O ^ y J
at t
oft
litt
TREASURY DEPARTMENT
Washington
FOR RELEASE, MORNING NEWSPAPERS,
Friday, October 16, 1942._____ *
10/ 15/42
The Secretary of the Treasury, by this public notice, in
vites tenders for $ 500 ,000 ,000 , or thereabouts, of 9 1 -day
Treasury bills, to be issued on a discount basis under competi
tive bidding.
The bills of this series will be dated October
21, 1942, and will mature January 20, 1943, when the'face amount
will be payable without interest.
They will be issued in bearer
form only, and in denominations of $1 ,000 , $ 5 ,000 , $1 0 ,000 ,
$10 0 ,000 , $ 500 ,000 , and $1 ,000,000 (maturity value).
Tenders will be received at federal Reserve Banks and
Branches up to the closing hour, two o !clock p. m., Eastern
War time, Monday, October 19, 1942. Tenders will not be re
ceived at the Treasury Department, Washington. Each tender
must be for an even multiple of $1 ,000 , and the price offered
must be expressed on the basis of 10 0 , with not more than three
decimals, e. g., 99^925« fractions may not be used. It is
urged that tenders be made on the printed forms and forwarded
in the special envelopes which will be supplied by federal Re
serve Banks or Branches on application therefor.
Tenders will be received without deposit, from incorporated
banks and trust companies and from responsible and recognized
dealers in investment securities. Tenders from others must be
accompanied by payment of 10 percent of the face amount of
Treasury bills applied for, unless the tenders are accompanied
by an express guaranty of payment by an incorporated bank or
trust company.
Immediately after the closing hour, tenders will be opened
at the federal Reserve Banks and Branches, following which
public announcement will be made by the Secretary of the Treasury
of the amount and price range of accepted bids. Those sub
mitting tenders will be advised of the acceptance or rejection
thereof. The Secretary of the Treasury expressly reserves the
right to accept or reject any or all tenders, in whole or in
part, and his action in any such respect shall be final. Bayment of accepted tenders at the prices offered must be made or
(Over)
33-67
- 2 -
completed at the Federal Reserve Ranh in cash or other immedi
ately available funds on October 21, 1942♦
The income derived from Treasury bills, whether interest
or gain from the sale or other disposition of the bills, shall
not have any exemption, as such, and loss from the sale or
other disposition of Treasury bills shall not have any special
i
treatment, as such, under Federal tax Acts now or hereafter
enacted. The bills shall be subject to estate, inheritance,
gift, or other excise taxes, whether Federal or State, but
shall be exempt from all taxation now1or hereafter imposed on
the principal or, interest thereof by any State, or an3r of thepossessions of the United States,' or by any local taxing author- j
ity. For purposes of taxation the amount ofjdiscount at which
Treasury bills are Originally sold by the United States shall
be considered to be interest. Under Sections 42 and 117 (a) (1) j
of the internal Revenue Code, as amended by Section 115 of the
Revenue Act of 1941, the amount of discount at which bills is
sued hereunder are sold shall not be considered to accrue until
such bills shall be sold, redoemed or otherwise disposed of,
and such bills are excluded from consideration as capital as
sets. Accordingly, the owner of Treasury bills (other than
life insurance companies) issued hereunder need include in his
income tax return only the difference between, the price paid
for^such bills, whether on original issue or on^subsequent pur
chase, and the amount actually received either upon sale or
t
redemption at maturity during the taxable year for which the
return is made, as ordinary gain or loss. /
Treasury Department Circular No. 418, as amended, and this
notice, .prescribe the terms of the Treasury bills and govern
the conditions of their issue. Copies of the circular may be
obtained from any Federal Reserve Bank or Branch.
-OOo-
-
2
-
United States today are aware of our restrictions on the importation of
currency^ ^ £11 such persons have had ample opportunity to make arrangements
financing themselves other than hy the use of United States currency#
(T
i
[Treasury officials -stated? that persons leaving the United States
should not carry with them United States currency in excess of
is it unwise to carry United States currency outside of the United States
because of the restrictions upon its reimportation, it is also imprudent in
view of the fact that due to this Government* s policy dollar currency is
worth only a fraction of its former_value in Europe and most parts of Central
and South America«
In fact,^regulations adopted in cooperation with this
Government* s currency program make the general use of dollar currency illegal
in most of the other American Republics. ^Atte n t i o n c a l l e d to the fact that
in view of these regulations, travelers may find themselves unable to
utilize even the aforementioned $50 amount«
[Traveler*s checks, drafts, or telegraphic transfers are the best
means of satisfying financial needs while traveling outside the United States
at the present time^
,
It was pointed out hgSnflVnnrmiy :ffitrluls that the curtailed use and
value of dollar currency abroad has had no effect on the dollar as an inter
national medium of credit«
The restrictions on foreign dealings in dollar
notes have in no way affected the value of dollar drafts, checks or credits.
|
TREASURY DEPARTMENT
Washington
persons entering the United States from any place other than Mexico, Great
Cu ^lJLQ
Britain, Bermuda, Canada and Newfoundland, would be required to turn over
to customs authorities all the currency in their possession in excess of
150. |t his ruling supersedes the previous requirement that all currency in
excess of $250 be turned over to the customs authorities.
i regulations
jprociegitly in effect with respect to currency brought into the United States
from Mexico remain unchanged, and two dollar bills and subsidiary coins may
move freely between the United States and Mexico.
sury.Degart b e d w pointed out that the new ruling
constitutes a tightening up of the controls aimed at preventing the disposition
in this country of currency looted by the Axis.
When the controls, which
Reserve Banks, were inaugurated last spring, an exception was made in order to
•Sr
permit legitimate users of dollar currency time enough to become familiar
with, the currency regulations.
In order to give legitimate users of dollar
currency time to adjust themselves to the $50 limitation, the Treasury Depart
ment is giving this advance notice of the ruling
which will become effect ire
^The Treasury has repeatedly warned persons leaving the United States
to carry some means of payment otb
>s currency when travel
ing outside of the United States.--
persons arriving in the
TREA3URY DEPARTMENT
Washington
FOR IMM E D I A T E RELEASE,
Friday, O c t o b e r 1 6 , 19*12
P r e s s S e r vice
No. 33-63
The T r e a s u r y D e p a r t m e n t t o d a y a n n o u n c e d that,
October 31,
19^2,
p e r sons e n t e r i n g the U n i t e d S t ates f r o m any
plaoe o t h e r t h a n Mexico,
foundland,
after
Ore at Britain,
Bermuda,
C a n a d a a n d New-»
w i l l . b e r e q u i r e d to turn o v e r to C u s t o m s a u t h o r i t i e s
all the c u r r e n c y in t h e i r p o s s e s s i o n In excess of $50,
This r u l i n g supersedes the p r e v i o u s r e q u i r e m e n t t h a t all
currency in e x c e s s of $ 2 5 0 be t u r n e d o v e r to the Customs a u t h o r ! ties*
T he r e g u l a t i o n s n o w in effect w i t h respect to c u r r e n c y b r o u g h t
into the U n i t e d States from M e x i c o r e m a i n unchanged, and t w o - d o l i a r
bills and s u b s i d i a r y coins m a y m o v e f r e e l y b e t w e e n the U n i t e d
States a nd Mexico.
T r e a s u r y o f f i c i a l s p o i n t e d out that the n e w r u l i n g c o n s t i t u t e s
a tightening of the controls a i m e d at p r e v e n t i n g the d i s p o s i t i o n
in this c o u n t r y of c u r r e n c y l o o t e d b y the Axis.
W h e n the controls,
which r e q u i r e the sur r e n d e r of i m p o r t e d c u r r e n c y to C u s t o m s o f f i
cials and to F e d e r a l R e s e r v e Banks, w e r e i n a u g u r a t e d last Spring,
an exception was m a d e In o r d e r to p e r m i t legi t i m a t e u s e r s of d o l
lar cu r r e n c y time enough to b e c o m e f a m i l i a r w i t h the curre n c y
regulations.
I n o r d e r to give l e g i t i m a t e u s ers of d o l l a r c u r r e n c y
time to adjust t h e m s e l v e s to the I 5 0 limitation, the T r e a s u r y
Department Is g i v i n g this a d v ance n o t i c e of the ruling*
T he T r e a s u r y has r e p e a t e d l y w a r n e d p e r s o n s l e a v i n g the U n i t e d
States to c a r r y some m e ans of p a y m e n t o t h e r t h a n U n i t e d States
currency w h e n t r a v e l i n g o u t side of the U n i t e d States.
Officials
said it is a s s u m e d that p e r s o n s a r r i v i n g in the U n i t e d States t o
day are aware of o u r r e s t r i c t i o n s on the I m p o r t a t i o n of c u r r e n c y
as all such p e r s o n s h a v e h a d ample o p p o r t u n i t y to m a k e a r r a n g e
ments for f i n a n c i n g t h e m selves o t h e r t h a n b y the u se of U n i t e d
States currency.
T r e a s u r y o f f i c i a l s said that p e r s o n s l e a v i n g the U n i t e d States
should not carry w i t h t h e m U n i t e d S t ates cu r r e n c y in excess of $ 5 0 *
They d e c l a r e d t h a t not only is It u n w i s e to carry U n i t e d States
currency ou t s i d e of the U n i t e d Stat e s b e c a u s e of the r e s t r i c t i o n s
2
upon its r e i m p o r t a t i o n } It is also Imp r u d e n t in v i e w o f the
fact that due to this G o v e r n m e n t * s p o l i c y d o l l a r c u r r e n c y is
worth o n l y a f r a c t i o n of its f o r m e r v a l u e in E u r o p e a n d m o s t
parti o f C e n t r a l a n d S o u t h A m e rica*
In fact, they p o i n t e d Out,
regulation s a d o p t e d in c o o p e r a t i o n w i t h this G o v e r n m e n t ' s cur-*
rency p r o g r a m m a k e t he g e n e r a l u s e of d o l l a r c u r r e n c y i l legal
in most of t he o t h e r A m e r i c a n R e p u b l i c s . A t t e n t i o n was also c a l l e d to the fac t that in v i e w of
these r e g u lations, t r a v e l e r s m ay f i n d t h e m s e l v e s u n a b l e to
utilize even the a f o r e m e n t i o n e d $ 5 0 amount.
T r a v e l e r 1s checks, drafts, or t e l e g r a p h i c t r a n s f e r s are
the best m e ans of s a t i s f y i n g f i n a n c i a l n e eds w h i l e t r a v e l i n g
outside the U n i t e d S t a t e s at the p r e s e n t time, o f f i c i a l s o b
served.
It was p o i n t e d out that the c u r t a i l e d us e a nd v a l u e of
dollar c u r r e n c y a b r o a d h as h a d no effect on the d o l l a r as ah
International m e d i u m of credit.
T h e r e s t r i c t i o n s on f o r e i g n
dealings In d o l l a r notes hav e in no w ay a f f e c t e d the v a l u e of
dollar drafts, c h ecks or credits.
-000-
TREASURY DEPARTMENT
Washington
/
Press Service
No. 3 *3r (p°i
FOR RELEASE. MORNING NEWSPAPERS
/7j/ŸV7-.
The Treasury announced today a new plan approved by the
President for the
and immediate vicinity, jThe new plan has for its purpose the allevi
ation of shopping, banking, and check-cashing difficulties encoun
tered by employees under the present system and of more evenly
spreading the work load incident to the payment of salaries.
The
large increase in personnel in Washington during the past year has
tablishing the new staggered pay-day sjG^P^ule for employees whose
'-H r
salaries are paid by fcae- Division of Disbursement, the Treasury
pointed out that
■fcftken
consider
payments made by other disbursing officers on various days of the
month.
Employees whose pay days are changed will receive either
an extra check or a larger check to cover the period from the end
of their present pay periods to the beeinning of the new oav periods.
over 20 p
Attaehmon
TREASURY REPARTAIENT
Washington'
Press Service
No. 33-59
FOR RELEASE MORNING NEWSPAPERS,
Saturday, October 17, 1942___
10/16/42
The Treasury announced today a new plan approved by the
President for the staggering of pay days for Government employees
in Washington and immediate vicinity.
The new plan has for its purpose the alleviation of shop
ping, banking, and check-cashing difficulties encountered by emunder the present system and 'of rrlore evenl y spreading
r~> ToT
'-g
p'c
p
j.1
i-,
ie
s.
k load incident to the payment of salaries. m
in personnel in Washington durIn g the past year has ca
congesticn, officials sai
:he new system will be inaugurated Novemb
it*
r>
In estab-
lishing the new staggered pay day schedule for employees whose
salaries are paid by its Division of Disbursement, the Treasury
pointed out that consideration was given to- payroll payments
made by other disbursing officers on various days of the month.
Emplo^/ees whose pay days are changed will receive either an ex
It is estimated
335,000 employees ir
ef
CD
ods
their present pay periods
cl
tra check or a larger check to cover the period from the end of
)egInning
hat ov n ext July‘ 1 t:
ciSZiingten rciceiving
Spread evenly over 20 pay days, the average number of employees
to be paid on each pay day under, the new plan will be about
33,600.
-oOo-
- 9 for a world In which the things that are good and noble flourish«
A part of what we are fighting for is set forth in a pgpm of
Fred Branch entitled «Our Kids« Kids.«
We fought to get this Country, we fought to make it free,
And we intend to keep it so
through
all the years to bej
W e ’ve had to go to w a r again and when
this
war is through
There w o n ’t be any fighting left for our |jps# kids to do*
CHORUS
Your kids’ kids and^a^ kids’ kids shall newer fight a war,
For they shall have the kind of world that we are fighting for*
There w o n ’t be any Hitlers then to turn things ufteide down,
Berlin w o n ’t be a city, just a quiet country town.
Benito Mussolini and his pals the Japanese
Will be the funny pictures in the future historiesi
Where your kids’ kids and ray kids' kids will read how it was done,
When we crumpled up the Axis and put out the Rising Sun»
- 8 -
In all seriousness I say to you that if any d t y or town in America
fails in its quota for foreign relief it will be shamed as long as man
remembers, but if we In Washington, —
world, —
we who live in the capital of the
we who are most aware of the sacrifices which have been made
and what it has meant to us ■— if we here fail in our obligations to the
United Nation* War Relief tibs PipCFCusslons will, bi
Ask yourseif i^iat it will mean to th# people of Athens end Warsaw,
|
/
a
-•’Jp..
Ls**-*^*^
Brussels and Amsterdam, to those millions of people all over Europe whose
hope in us alone sustains them in their misery. Ask yourself what it
7 7
,
.. W ' J F : ' - ' If.
will mean to them if they hear that we in Washington have turned a deaf
//
/
ear to their'pleas• What 'qucier morsel would Herr Qoebbels like to spread
over Europe than that America did not remember, »-««America did not care.
& do you think the effect would be on the Volga if German planes dig«
t^Abuted over Stalingrad news of our failure to those men who live in the
U y f i l t h and muck and rubbish of a devastated town, hoping only for a chance
^
to escape the bombs and the shrapnel so that they m y have an opportunity
to drive cold steel into hostile flesh, to carry on their fight and our
fight.
Fail#
We cannot,
let us resolve this afternoon that we will make
of this campaign the opening shot to be heard round the world, to
demonstrate the practical and personal drdLty of the peoples of the
United Nations,
For many of ui in this room it is the most direct
contribution to victory we will be able to make,
A
Remember we*re fighting for a lot more than just ourselves.
fighting for
We’re
w m act a lasting peace not only for ourselves but for others,
/
- ? -
project, of the gallant fight the Greek people made againet the Faaeiats
•nd the Basis.
But you should remind them that last winter 2,000 of these
heroio people died of starvation every week.
You might tell then that pert
of every dollar contributed to this Community War Fund In Washington will
go for food which is being shipped to Greece to save these lives.
Surely the people of Washington oan remember the defiance to tyranny
which brought down upon Poland such a horrible fate,
tod they know how
Poles throughout the world continue to fight that tyranny.
Surely t h e y u
b« glad to halp Polish War Relief,
There is scarce need to prod the people of Washington to contribute
to the relief of those people who first faced aggression and too have
longest combatted it —
our valiant alllee the Chinese.
*ho needs to be persuaded to help the Dutch or the British»
And how about the Russians»
During the last 52 days we have seen a
demonstration of dogged heroism never excelled in the military history of
the world.
Facing the concentrated fury of the invader the Russians have
given the world its greatest demonstration of the power of the will to
win.
All these people -
the Russians, the Chinese, the British, toe Poles,
the Dutch, toe Greeks, the Norwegians, Belgians, French and Jugoslavs all the countless thousands too fight on active fronts or who suffer and
sabotage in conquered lands are fighting our fight.
To them
every
woman, and child in America owes a greater debt than we can ever repay.
They kept toe conquerors from our coasts, the murderers from our hoses.
They won for us that priceless time to build our own defenses.
\
- 6 -
brag our heads off about the great part we played in Washington life
while we were here*
lay I suggest that you remind those who sing the
old home town chant that they can recall their Washington experiences
trt~ Ovi,
far more pleasantly if while they were here they .con
, but also
-
A
contributions back hone ami assumed their fair share of the responsibility
of helping their less fortunate fellows here in Washington.
To all the appeals the Community Chest has made in past years there
are added this year
tm new and compelling onest
The United Service
Organisation, both national and local, will use your contributions to
provide hospitality, recreation and entertainment for our service men
both in camp and in transit.
Don't forget that during this campaign.
The picture of hot coffee and doughnuts for men in uniform may appeal
to son» contributors who can't be reached any other way.
The United nations War Belief constitutes an aspect of this campaign
which I think cannot be over-emphasised.
Participating in this group are*
The British War Belief Association,
Greek War Relief Association,
Queen Wilhels&na Fund,
Polish War Relief,
United China Relief,
U. S. Committee for the Care of European Children, and
T h e W ^ y Prisoners Aid Committee.
3)
1 wonder
there is a man or woman in Washington who needs to be
urged to contribute to tide group.
I don't think you'll need to remind
M
**¿1 tiWir families.
I anticipate that another excuse you will encounter
will be a cosplaint against the increase in the cost of living.
To be
sure the cost of living has increased in Washington, but it has almost
everywhere else in America.
It has in Boston, in Cleveland, in Buffalo,
in Balias, in San Francisco and Denver but it didn’t prevent any one of
those cities from going over the top in its Community War Fund campaign
this year.
Probably the most frequent excuse you will hear will be that old.
old story of one’s loyalty to his old home town and the obligation to
Q Id K«vvt 'fcririArv*-'
contribute back home. I am not only familiar with the crowd -u- —
thirt
_bcit
^
ememee, I am really one of the crowd myself^
X can assure you that there's
no homesick stenographer in this town fssr can sigk half as hard for Wain
Street as I can for the hills of New Hampshire.
I love that state and the
people in it, and I hope some day to return there to enjoy its mountains,
its lakes and its ocean.
But^
ti
u
i
the most recent
newcomer to Washington must realise that this city of ours is one of the
finest cities in America, a city which is rapidly becoming the capitol
of the world.
Speaking for Byself and I believe for the great majority
who are temporarily here in government service, I consider
privilege to be able to live and work in Washington during
years; to be able to make aome small contribution toward victory in the
most crucial challenge our civilisation has ever faced.
that when we have returned to our old home
I know full well
11 of us who have been
here temporarily will look back upon our Washington experiences with a
fcreat pride and with great satisfaction.
And don’t you think for Or»
moment that when we get back to the drugstore and the legion Hal 1 we won’t
— 4 **
I know something of the work you are about to perform and the
obstacles you must suraount.
ji anoyances
I»m familiar with the disappointments and
and irritations you will meet*
Bat I ©an foresee no difficulty
in this campaign that patience, persistency and ingenuity cannot overcome*
I
know
yett*jj!l hear
a lot of excuses*
I
strongly suspect
that most
of
the excuses offered by people who are unwilling to contribute their fair
3
share to this campaign will fall in two* categories •
I think y o u *11 hear something about increased taxes*
do
not know very much about that.
Naturally I
But I can tell you that the man who
pleads increased taxes as an excuse for not helping his unfortunate
fellows has something more fundamentally wrong with him than merely a
deficiency in charity*
a financial exaction*
child knows today —
He should know that a Federal tax is more than
A
He should know •*» as almost every man, woman and
that Federal taxes are imposed to enable us to build
A
a Navy that will sink our enemy's ships beneath all the seven seas; they
are imposed to build and man an Air Force that will sweep the world *s
skies clear*
The objective of taxes^is to enable us to «awn and equip
armies that will crush the Heals and Japs In Europe, Asia, or Africa f or
wherever we have to chase them*
When a man pays a Federal tax today he
is contributing to the restoration of liberty which has been trampled and
defiled and stolen from the lands of our ancestors.
He is contributing
to the prdservation of ourselves and our children<^th© freedom and the
.
...
*
‘far eufS t i v e s ,
opportunity which we Americans have created in this nation*
A
So it might be well for you to remind those who plead increased
taxes as an excuse just what those taxes are helping to preserve for them
3
opens*
In making this recommendstion, I know I ’m not suggesting the
impossible*
It has been done before and it can be done again*
Ae a matter
of fact this afternoon I heard a rumor that three departments plan to
deposit their quotas and end their drives on the opening day of this
campaign*
I am passing this rumor along to you because I know that none
of us enjoy marching *r the tail end of a parade#
But I should warn you
that if you intend to head the parade with those three other departments,
it will require all of your energy and all of your determination#
This year as in the past the Community Chest appeals to all that
is best in every one of us to aid them in the noble work its member agencies
are performing*
The charities and services for wteest the Community Fund
collects are doing ¡finejwork, and work vital to the welfare of the community.
The Community Chest is a lot more than just a general relief society*
Its
services are not by any means limited to people who are in financial trouble.
It helps the blind and the lame* the orphans and the aged*
guidance to youth*
It keeps young boys off the streets and out of gangsf
and out of police courts#
entire community.
a check.
It gives needed
It helps to protect the health and morale of the
It doe® a thousand jobs that can’t be done by just signing
Through these combined member agencies there is being done a great jo
•^xfor laeMnkton that could not possibly be done in any other way.
i < X U
helped so many people hasn’t helped the
blind, the inform, the aged or the orphans*
our help, —
depending on our help*
They are still with us, asking
-
int0
2
-
R&eery we in America net have the heart and the means and
the will and the energy to extend to our own unfortunates that help
which is denied to Wfe unfortunates throughout most of the rest of the
( « - f t
alone has been left the responsibility of holding
aloft the enlightening, warning and comforting torch of charity, upon
whioh to a great extent depends the recovery of the world and civilisa
tion itself,
ry /
/
In this campaign we dare not fail, we will not fail.
We have a
fine General Chairman, an excellent Government Unit Chairman*
in this room we have a grand group of salesmen.
Here
We enjoy all of
the advantages that come from experience, planning, organisation.
And we*re going to put this drive over the top.
We* 11 do it because
we will be selling the finest product on the markets of the world today —
the relief of human misery and the suffering of our fellows.
How whenever troops go into action they always wonder how long the
battle will last,
want it to last.
later.
this particular campaign will last just as long as you
We all know we are going to get that quota sooner or
Rone of us enjoy long drawn out campaigns.
Particularly this
year when the men and women in government service are working so much
harder and dairying so much more responsibility than usual an extended
campaign would not be fair to ourselves nor to Uncle Sam who needs all
our time.
So I suggest to you that the determination and energy and ehthusiasm
of your co-workers be directed toward a blitz |i^eig that will put every
division of the Government Unit over the top three days
after the campaign
Address of Joha 1. Sullivan,j Assistant Sseretar 7 ©f the Treasury
^
Dpj Qr** before the Government Unit of the Community War Pond J
'" October 16, 1943»
^ ----- ----— ----HSdiB
*
1
a
1Tvv- J i>, d
X am very grateful for the opportunity to meet this afternoon
with the shook troops of Washington*e Cosammlty War Fund Campaign*
You men and women, —
chairmen and keyaam of the various bureaus
ami agencies^»arry the full responsibility of the Cjovemssent Unit*
Since the quota of the Government Unit properly constitutes more than
one-half the entire quota, I feel that in meeting you X face the very
group upon shorn the success of this campaign most depends.
This is a
responsibility which none of us this year can accept lightly*
We are about to start an offensive against human suffering and
B&sery —
against poverty and need and illness and loneliness and
many other evils that sap the morale of civilian population and men
In the services alike*
A# the aero hour approaches it might be sell
for us to revie* our objectives and the manner in
which we intend to
achieve them*
First of all you must realise that outside the armed services
n o mere, heijafuf
and military production there ia no nobler work than that which you
(ACTall
h
*
are about to do*
Democracy —
Wext to Democracy itself —
and indeed a part of
comes the alleviation of human suffering*
I am sure
we are all proud that we have been selected to carry to our fallow.«
this great humanitarian appeal*
We should remember that almost nowhere else in the world today
can men and women engage in the inspiring work you will perform
within the neat month.
There are no Community Cheat drives this year
in Poland, Norway, Denmark, the Netherlands, Belgium, France, Yugoslavia, A M
or Greece*
tet us thank God that now when most of the world is r ^ n m r 1.
c? V A s> A j, k 3 5
tn v j y
«*'»«'«-•' £ 1
** - f
^Address of John L. g s p i l v ^
.«g|sjjkggg£g
X urn very grateful for the opportunity to meet this afternoon
with the «hock troops of Washington’s Community War Fund Campaign,
too men and worn», —
p
C
chairmen and keymen of the various bureaus
and agencies^carry the full responsibility of the Government Uhtt.
Since th® quota of the Government
Unit properly
conatitutee more than
one-half the entire quota, 1 feel that in meeting you X face the very
group upon i i ® the success of this campaign most depends.
V
This
is a
responsibility which none of us this year can accept lightly*
We are about to start an offensive against human suffering and
misery —
against poverty and need and illnesa and loneliness and
i**ny other evils that sap the morale of civilian population and
in ths services alike*
mn
As the aero hour approaches it eight be veil
for us to review our objectives and the manner in which we intend to
achieve them*
First of all you must realise that outside the aimed services
{Atticid.
no mere hefNM
are about to do.
Democracy —
Next to Democracy itself —
and indeed a part of
comes the alleviation of human suffering*
X am sure
we are all proud that we have been selected to carry to our fellows
this great humanitarian appeal.
We should remember that almost nowhere else in the world today
can men and women engage in the inspiring work you will perform
V
within the next month.
There are no Community Chest drives this year
in Poland, Norway, Denmark, the Netherlands, Belgium, France, Yugoslavia, AiU
or Greses,
let us thank God that now when most of the world is r^iHiffirr*"
TREASURY DEPARTMENT
DIVISION O F PUBLIC RELATIONS
W a r Savings
...
R e l e a s e No#
^
'
/V<\y>n rs.-gs 4*o
^
,’
A.OQ ^ ncyVP *^1 H
with the «hock troop« of Washington’s
.
Community War Fond Campaign.
ton sen and women, — chairmen and keymtm of the various bureaus
and agenclee^oarry th« full responsibility of th« Government Uhil.
Sine« the quota of the
Oovmftmmt tinit properly constitutes acre than
one-half the entire quota, I feel that in nesting you 1 face the very
group upon whon the success of this campaign meet depends*
This is
a
responsibility which none of ue this year can accept lightly*
w« are about to atari an offensive against human suffering and
misery —
against poverty and need and illness and loneliness and
nary other evils that sap the morale of civilian population and
in the services alike.
mn
As the aero hour approaches it might be well
for us to review our objectives and the manner in which we intend to
achieve them*
First of all you must realise that outside the armed services
<k£\tuX
*U> m^re HefhfMi
and military production there is no nobler work than that which you
fV
j§;
A
are about to- do. W«oct to Democracy itself — and indeed a part of
Democracy —
comes the alleviation of hunmn sufferli^.
I an sure
we are all proud that we have been selected to carry to our fallows
this great humanitarian appeal.
We should remember that almost nowhere else in the world today
can men and women engage in the inspiring worts you will perform
within the next month.
There are no Community Chest drives this year
in Poland, Norway, Denmark, the Netherlands, Belgium, France, Yugoslavia
or Greece,
let us thank Cod that now when most of the world is
plmm*
+ ser**~ *
%
I ara very grateful for the opportunity to meet this afternoon
with the shook troops of Washington*» Cosammity War Fund Campaign,
too men and women, —
-.
chairmen and keymen of the various bureaus
N
.V' \ ■
i/0
Since
tfee quota
of the Government Unit properly constitute» more than
one-half the entire quota, I feel that in meeting you 1 face the very
group upon shorn the success of this campaign most depends*
This
is a
responsibility which none of us this year can accept lightly*
We are about to start an offensive against human suffering and
misery —
against poverty and need and illnesa and loneliness and
many other evils that sap the morale of civilian population and
in ths services alike*
mn
As the aero hour approaches It might bs well
for us to review our objectives and the manner In which we intend to
achieve them*
First of all you must realise that outside the anaed services
a t? tu d
M m ere. hefhfM
and military production there Is no nobler work than that which you
A
A
are about to- do* Next to Democracy itself — and indeed a part of
Democracy —
comes the alleviation of human suffering*
I am sure
we are all proud that we have been selected to carry to our fellows
this great humanitarian appeal*
We should remember that almost nowhere else in the world today
can men and women engage in the inspiring work you will perform
within the next month.
There are no Community Cheat drives this year
in Poland, Norway, Denmark, the Netherlands, Belgium, Francs, Yugoslavia, Alin
or Greses*
let us thank God that now when most of the world is juliwuCT*'
TREASURY DEPARTMENT
WASHINGTON
Address of John 1», Sullivan, Assistant Secretary of the Treasury,
delivered "before the Government Unit of the Community War
Fund Drive, Washington, D. C., October lo, 19^2
I am very grateful for the opportunity to meet this afternoon with
the shock troops of Washington’s Community War'Fund Campaign. You men
and women, — chairmen and keymen of the various bureaus and agencies, carry the full responsibility of the Government Unit.
Since the quota
of the Government Unit properly constitutes more than one-half the
entire quota, I feel that in meeting you I face the very group upon
whom the success of this campaign most depends. This is a responsi
bility which none of us this year can accept lightly.
We are about to start an offensive against human suffering and >
misery — against poverty and need and illness and loneliness and
many other evils that sap the morale of civilian population and men
in the services alike. As the zero hour approaches it might be well
for us to review our objectives and the manner in which we intend to |
achieve them.
i
First of all you must realize that outside the armed services and
actual military production there is no nobler no more helpful Work
than that which you are about to do. Next to Democracy itself ~ and
indeed a part of Democracy — comes the alleviation of human sufferig.
I am sure we are all proud that we have been selected to carry to our
fellows this great humanitarian appeal.
We should remember that almost nowhere else in the world
can men and women engage in the inspiring work you.will perform^within
the next month. There are no Community Chest drives this year in .■
Poland Norway. Denmark, the Netherlands, Belgium, France ïugoslavia,
Albania or Creece. Let us thank Cod that now whe“
“ he
is plunged into abject-misery we in America hâve the heart and the
means and the will and the energy to extend to our own
t
that help which is denied to unfortunates throughout most of the re t
of £heworld! To us almost alone has been left the responsibility of
holding aloft the enlightening, warming and comforting torcn ol
charity, upon which to a great extent depends the recovery of the ,
world and civilization itself.
In this campaign we dare not fail, we will not fa^l*
in
fine General Chairman, an excellent Government Unit - C t a i r m a n .
Here^i:
this room we have a grand group of salesmen. We
^
°f
vantages t h a t come from experience, planning, organization. M i "P *
¡oing to put this drive over the top. We'll do it because we will be
3 3 -7 0
selling the finest product on the markets of the world today — - the
relief of human misery and the suffering of our fellows.
How whenever troops go into action they always wonder how long
the battle will last. This particular campaign will last just as long
as -you want it to last. We all know we aye going to get that quota
sooner or later. Hone of us enjoy long drawn out campaigns. Particu
larly this year when the men and women in government service are
working so much harder and carrying so much more responsibility than
usual an extended campaign would not be fair to ourselves nor /bo
Uncle Sam who needs all our time.
So I suggest to you that the determination and energy and en
thusiasm of your co-workers be directed tov&rd a blitzkreig that will
put every division of the Government Unit over the top three days
after the campaign opens. In making this recommendation, I know I’m
not suggesting the impossible. It has been done before and it can be
done again. As a matter of fact this afternoon I heard a rumor that
three departments plan to deposit their quotas and end their drives
on the opening day ofthis campaign. I am passing this rumor along
to you because I know that none of us enjoy marching at the tail end
of a parade. But I should warn you that if you intend to head the
parade with those three other departments, it will require all of
your energy and all of your determination. '
This year as in the past the Community Chest appeals to all that
is best in every one of us to aid them in the noble wprk its member
agencies are performing. The charities and services for which the
Community Fund collects are doing fine work, and work vital to the
welfare of the community.
The Community, Chest is a lot more than
just a general reliefsociety. Its services are not by any means
limited to people who are in financial trouble. It helps the blind
and the lame,, the orphans and the aged. It gives needed guidance to
youth. It keeps young boys off the streets and out of gangs, and out
of police courts. It helps to protect the health and morals of the
entire community. It does a thousand jobs that can’t be done by just
signing a check. Through these combined member agencies there is
being done a great job for Washington that could not possibly be done
in any other way.
Remember the boom that has helped so many people hasn’t helped
the blind, the infirm, the aged or the orphans. They are still with
us, asking our help,
depending on our help.
I know something of the work you are about to perform and the
obstacles you must surmount. I’m familiar with the disappointments
and annoyances and irritations you will meet. But I can foresee no
difficulty in this campaign that patience, persistency and ingenuity
cannot overcome.
I know you*XI hear a lot of excuses. X strongly suspect that most
of the excuses offered hy people who are unwilling to contribute their
fair share to this campaign vrill fall in 3 categories.
X think you*11 hear something about increased taxes. Naturally I
do not know very much about that. But I can tell you that the man who
pleads increased taxes as an excuse for not helping his unfortunate
fellows has something more fundamentally wrong with him than merely
a deficiency in charity. He should know that today a Federal tax is
more than a financial exaction. He should know — as almost every
man, woman and child knows today — that Federal taxes are now imposed
to enable us to build a Navy that will sink our enemy’s ships beneath
all the seven seas; they are imposed to build and man an Air Force
that will sweep the tirorld’s skies clear. The objective of taxes today
is to enable us to man and equip armies that will crush the Nazis and
Japs in Euroue, Asia, or Africa, or wherever we have to chase them.
When a man pays a Federal tax today he is contributing to the restora
tion of liberty which has been trampled and defiled and stolen from
the lands of our ancestors. He is contributing to the preservation
of ourselves and our children and the freedom and the opportunity
which we Americans have created for ourselves here in this nation.
So it might be well for you to remind those who plead increased
taxes as an excuse just what those taxes are helping to preserve for
them and their families.
I anticipate that another excuse you will encounter will be a
complaint against the increase in the cost of living. To be sure the
cost of living has increased in Washington, but it has almost every
where else in America. It has in Boston, in Cleveland, in 3uffalo,
in Dallas, in San Francisco and Denver but it didn’t prevent any one
of those cities from going over the top in its Community War Fund
campaign this year.
Probably the most frequent excuse you will hear will be that old,
old story of one’s loyalty to his old home town and the obligation to
contribute back home. I am not only familiar with the old home town
crowd but X am really one of the crowd myself. I can assure you that
there’s no homesick stenographer in this town who can sigh half as
hard for Main Street as I can for the hills of New Hampshire. I love
that State and the people in it, and I hope some day to return there
to enjoy its mountains, its lakes and its ocean» B\it, the most recent
newcomer to Washington must realize that this City of ours is one of
the finest cities in America, a city which is rapidly becoming the
capitol of the world. Speaking for myself and I believe for the great
majority who are temporarily here in government service, I consiaer it
a great privilege to be able to live and work in Washington during
these dramatic years; to he able to make some small 'contribution toward
victory in the most crucial challenge our civilization has ever faced.
I know full well that when we have returned to our old home towns.All
of us who have been here temporarily itfill look back upon our Washington
experiences with a great pride and with great satisfaction. And don’t
you think for *one moment that when we get back to the drugstore and
the Legion Hall we won’t brag our heads off about the great part we
played in Washington life while we were here. May 1 suggest that you
remind those who sing the old home town chant that they can recall
their Washington experiences far more pleasantly if while they were „
here they not only continued thedr charitable contributions back
home, but also assumed their fair share of the responsibility of
helping their less fortunate fellows here in Washington.
To all the appeals the Community Chest has made in past years
there are added this year two new and compelling ones: The United
Service Organization, both national and local, will use your contri
butions to provide hospitality, recreation and entertainment for our
service men both in camp and in transit. Don’t forget 1jhat during
this campaign* The picture of hot coffee and doughnuts for men in
uniform may appeal to some contributors who can’t be reached any
other way*
The United Nations War Relief constitutes an aspect of this cam
paign which I think cannot be over-emphasized* Participating in this
group are;
The British War Relief Association,
Creek War Relief Association,
Queen Wilhelmina Fund,
Polish War Relief,
United China Relief,
U* S. Committee for the Care of European Children, and
The War Prisoners Aid Committee.
X wonder if there is a man or woman in Washington who needs to
be urged to contribute to this group. I don’t think^you’11 need to
remind prospects of the gallant/ fight the Creek people made against
the Fascists and the Nazis. But you should remind them that last
winter 2,000 of these heroic people died of starvation every week.
You might tell them that part of every dollar contributed to this
Community War Fund in Washington will go for food which is being
shipped to Creece to save.these lives.
Surely the people of Washington can remember the defiance to
tyranny which brought down upon Poland such & horrible fate. And
they know how Poles throughout the world continue to fight that
tyranny. Surely they’ll be glad to help Polish War Relief*
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There is scarce need to prod the people of Washington to contribute
to the relief of those people who first faced agression and who have
longest combatted it — our valiant allies the Chinese.
Who needs to be persuaded to help the Dutch or the British?
And how a'bout the Russians? During the last 52 days we have seen
a demonstration of dogged heroism never excelled in the military his
tory of the world. Racing the concentrated fury of the invader the
Russians have given the world its greatest demonstration of the power
of the will to win.
All these people — the Russians, the Chinese, the British, the
Poles, the Dutch, the Creeks, the Norwegians, Belgians, French and
Yugoslavs — all the countless thousands who fight on active fronts
or who suffer and sabotage in conquered lands are fighting our fight.
To them every man, woman, and child in America owes a greater debt
than we can ever repay. They kept the conquerors from «our coasts,
the murderers from our homes. They won for us that priceless time
to build our own defenses.
In all seriousness I say to you that if any city or 'town, in
America fails in its quota' for foreign relief it will be shamed as
long as man remembers, but if we in Washington, — we who live in
the capitol of the world, — we who are most aware of the sacrifices
which have been made and what it has meant to us — if we here fail
in our obligations to the United Nations War Relief the repercussions
will be unthinkable.
>
What juicier morsel would Herr Go^bbels like to spread over
Europe than that America did not remember, — America did not care.
What do you think the effect would be on the Volga if German planes
distributed over Stalingrad news of our failure to those men who
live in the filth and muck and rubbish of a devastated torn, hoping
only for a chance to escape the bombs and the shrapnel so that they
may have an opportunity to drive cold steel into hostile flesh, to
carry on their fight and our fight.
|
\.v r ig| ^
Rail? We cannot. Let us resolve this afternoon that we will
make of this campaign the opening shot to be heard round the world,;
to demonstrate the practical and personal unity of the peoples of the
United Nations. Ror many of us in this room it is the most direct
contribution to victory we will be a.ble to make.
Remember we*re fighting for a lot more than just auf selves..
WeTre fighting for a lasting peace pot only for ourselves but for
others, for a world in which the things that are good and noble
flourish.
A part of what we are fighting for is set forth in a poem of
Fred. Branch entitled ”0ur Kids’ Kids.”
We fought to get this Country, we fought to make it free,
And we intend to keep it so through all the years to he;
We’ve had to go to war again and when this war is through
There won’t he any fighting left for our kids* kids to do.
CHORUS
Your kids’ kids and my kids’ kids shall never fight a war,For they shall have the kind of world that we are fighting for.
There won’t he any Hitlers then to turn things upside do\m,
Berlin won’t he a city, just a quiet country town.
Benito Mussolini and his pals the Japanese
Will he the funny pictures in the future histories;
Where your kids’ kids and my kids’ kids will read how it was done,
When we crumpled up the Axis and put out the Rising Sun.
^ 3 - 7 /
TR EA SU R Y D EPA RTM EN T
Washington
Address delivered by Harold N. Graves,
Assistant to the•Secretary,
before the
General Federation of W.o-men’s Clubs,
Sherman Hotel, Chicago, Illinois,
October 16, 1942
Since the General Federation held its meeting In
Washington last January, a great deal of water has flowed
under the bridge. Tremendous changes have begun to take
place in the pattern of our life on the home'front. T h e s e
changes are the first reflections of the enormous extent
and power of our mobilisation for the war.
I need not dwell on the empty chairs at the family din
ner table,nor on the faces missing from Sunday supper at home,
as the sons, husbands, and brothers go off to war. There
are empty chairs and missing faces in millions of homes.
When war strikes, our men must go. They are marching and
fighting in the army of freedom. They are making the tra
ditional answer of free, peoples to attack by tyrants.
What the rest of us are concerned with now is to make
sure that we who stay at home shall not fail our lighting
men. We want to make sure that they will never lack the
weapons to fight with. You women especially are concerned
with maintaining a vigorous, disciplined spirit on the
home front. You are taking thousands of places in our War
factories. But, what is vastly more important, yours is
the task of keeping the home together, and raising the
children, and maintaining our schools and our churches and
our many other free, democratic institutions, while the
men are away on the fighting lines. And.the^success with
which American women carry, out their responsibilities on
the home front depends to a large extent on the soundness
'of the Nation’s war-time financing.
Some of you may recall that ± had the privilege of
speaking to you at your meeting in Washington last January.
At that time, we were spending at the rate of slightly more
than two billion dollars a month for war purposes. Ih,
September, expenditures for war purposes were #5,400 mil
lions. Total expenditures were just short of six billions.
2
By next July, it is expected that Federal expenditures will
go to more than seven billion dollars a month* These fig
ures give us some idea of the change which has, taken place
in our conceptions of the 30 b of financing the war.
The General Federation and the Treasury have been work
ing together for a long time in connection with the War;
Bond campaign. >The work has-been of the highest importance
to the Nation’s war effort. War Bonds are now being bought
through deductions from payrolls by almost twenty million
workers, and we estimate that not fewer than 30 million
people are regularly/ investing a part of their income in
these securities. Sales are steadily increasing; In the
calendar year 1 9 4 2 they will surely exceJed 9 'billion dol
lars, and for the fiscal year 1 9 4 3 we expect them to reach
the average of a billion dollars a month which we set last
spring as our objective.
These results are encouraging. But 'War Bonds, no mat
ter how widely sold,, obviously cannot do more than a rel
atively small part of financing a war that is soon to be
costing us at the rate of 80 billion do3.1ars a year. In
largest measure, the job has got to be done partly by other
kinds of borrowing, and partly by taxation.
I think we are all bound to agree that sound policy
requires us to raise as large as possible a share of the
cost of the war by taxation rather than borrowing. Taxhs
do hot leave a burden of debt to be repaid in later years.
They carry no interest charges tp" be borne bjr future gen
erations. We are fighting-a war against the greatest mil
itary powers the world has ever seen--a war to protect our
free institutions, our homes, our families against utter
destruction. To defray the cost of this war--to pay the
price of-maintaining our independence and freedom, we
should all be willing,temporarily to cut down our living
standards, to forego all personal and private spending
save the costs of decent living, and yield to the Govern
ment for the support of our Army and Havy all our earnings,
all our incomes, excepting only what we need for shelter
and clothing and food and other necessities. It is con
fidence in the willingness of the American people to do
these things that lies at the bottom of the Government’s
policy for war financing.
We see this in the tax bill now pending in Congress,
and soon to be enacted. We need not go into the details
of this bill. It is sufficient to say that it is expected
to produce about 25 billion dollars in revenue during the
calendar year 1943. This figure is more than double the
&
- 3 12 billion dollars which we hope to raise from War Bonds.
But you will notice that the two sums taken together will
produce less than half the expected annual expenditure of
80 billion dollars for war purposes.
I think that it will be clear that the problem of fi
nancing the Government in these times is filled with diffi
culty. There will undoubtedly be still heavier taxes. Yet
it will always be necessary for the Treasury to supplement
its revenue receipts and the proceeds of War Bond sales by
periodical open market borrowings from the banks and other
financial institutions in amounts sometimes as high as
4 billion dollars a month. That type of borrowing, unless
proper safeguards are applied, tends to be inflationary,
and this leads me to speak of another aspect of the fi
nancing problem.
The economists now estimate that the individual in
comes of the American people have risen to a total of
120 billion dollars a year. At the same time, .the demands
of war production have cut down the s u p p ly of available
goods and services, at present prices, to a figure around
70 billion dollars, leaving an excess spending power amount
ing to 50 billion dollars. Taxes will of course cut heavily
into this excess spending power, and I have no doubt that
the further tax legislation to which I referred will be de
signed in some form to put penalties on spending and pre
miums on saving, with the object of checking the price
rises which are bound to result if people try to go on
spending as usual, and on the basis of vastly increased in
dividual incomes.
It is our opinion at the Treasury, however, that it
will never be possible to accomplish this object by taxa
tion alone, however drastic, and, so far as we know, no
feasible plan has ever been put forward,_whether for taxes,
or for compulsory savings, or for commodity rationing, or
for any combination of these things, which will automat
ically save the country from the danger of inflation.
There is no simple and easy way to avoid this danger.
The answer is to be found only in bringing about a public
consciousness of the reality and the seriousness of the
danger. It is to be found only by inducing habits of
thrift and saving and self-denial among all the people.
Here there remains a field for the continuation and in
fact the intensification of the War Savings program.
This has always been intended to some extent as an
educational program* It has never been conducted entirely
as a means of raising funds for the war needs of the
4
Government. Its main object has been to encourage people
to save their money, to curtail private spending, to cut
down the grand total of demands for consumer goods--all to
put a brake on rising prices and keep the cost of living
'within- due bounds. For these purposes, the War Bond cam
paign must go on. Though we find upon analysis that it
cannot be relied upon as a dominating factor in the sheer
job of raising funds to meet the military needs.of the
country, it will remain a force second to none in fighting
the War on the economic front. It will still be our chief
reliance in the War to prevent extravagance and waste and
to encourage self-restraint and thrift in our private lives
I hope that this discussion may have contributed a^
little to a better understanding of the magnitude and dif
ficulty of the problems involved in war financing. I nope
too, that it leaves clear the need for all of Us to con
tinue our efforts toward the sale of War Bonds in con
stantly increasing volume. For the fine work of j o u t or
ganization in this phase of the war effort, the Treasury
is very grateful. And we confidently count upon your
continued cooperation.
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19 *
improve it and in doing so nay sake farther changes in
the types of securities offered, especially to nonbenking
investors, and in the methods of offering then.
I have no doubt that you will all agree with the
objectives of our war financing policy. We all realise
that a great deal sore remains to be done in financing the
deficit as far as possible from outside the comnereial
banking syeten. To the extent, however, that we must
resort to the coaaercial banks, it is imperative that
interest rates be kept at prevailing levels and that the
maximum of liquidity be preserved.
The success of our war financing depends upon
I
attaining these objactives« ifa at the Treasury hairs had
^
C LA ^ct C L ^ U v JjX j A A ^ d ^ ^ * j #*jl
abundant evidence that the T*~n trtr iffltnrrr1oq. imti full
A
well what is at stake* Ms knew that we can continue to
count upon your cooperation.
o
O
o
r
—
securities which will be bought by banks will be financed
by increases In deposits for the banking system as a whole,|
It seena reasonable that the interest rate on securities
financed in this manner should be kept down to a »ptIitob
of two percent — regardless of the maturities involved «*
because the costs incurred by the banks In making loans
dirset to the Government, and in handling the increased
deposits resulting from these loans, ars small. Furthermore, from the point of view of the cost of financing the
war, Interest rates should be kept as low as is compatible
with the objective of financing the war as much as possibli
outside of commercial banks.
I think you will have seen by now that our financing
program has taken on a clear and well-considered patters.
laterally this program constitutes only a working frame*
work of principles. We shall, of course, endeavor to
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17
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told to commercial basks.
It m&y sees at tises that basks are being dieeriainaJ
against in not being permitted to snbseribe for ionger-ten
securitise which bear higher interest rates than two perceal
but this is not the ease. The Government would certainly
be doing the banks so favor if it permitted then to load
themselves with long-term issues. You may recall that
the report of the Economic Policy Commission of the
American Bankers Association, issued last April, concluded
that securities sold to banks should be limited to a tenyear maturity. I think all of you will agree that a
frosen banking system trying to become unfrozen after the
war by selling long-term Government securities might
create a bad situation.
It should also be noted that a large part of the
- 16 hare alee revived the uae of another short-term security *.
the certificate of indebtedness. Beginning in April of
thie year, we have thus far sold four certificate issues,
approximating 1-1/2 billion dollars each. Together with
bills, the certificates provide a large supply of shorttern paper, and thus add a large measure of liquidity to
the banking system. Incidentally, it should be remember«« j
that this liquidity Is going to be a very welcome offset
to declining capital ratios, and will make it easier for
banks to adjust themselves to the need of shifting deposit«
from area to area, a process that seems likely to contlmu,
In securities of over one-year maturity, we have
continued to offer the banks Treasury notes, and Treasury
bonds with a term of not over ten years. This means a
maximum Interest rat# of two percent on Treasury bonds
the ease of Treasury bonds. Interest rates on bills bar#
boon fixed at 3/1 of 1 percent, a rate that Is designed
to pronote the widespread distribution of this type of
security. The Federal Reserve Systea has posted a buying
rate of this amount so that any holder of bills knows that
he can convert then into cash at any tine and at this
specified rate. This arrangement has served to increase
greatly the flexibility of bills In the noney market and
has also aided in the more effective use of excess reserve*,
For all practical purposes, excess reserves can now be
invested in Treasury bills without sacrificing liquidity.
At a result, we have been able to Increase steadily the
amount of bills outstanding so that today more than 2-1/2
times as much is outstanding in bills as on December 7*
In addition to this large increase in bills, we
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1U -
bttn »pent in ttmying consumers' goods. It is only by
drawing in nonoy that would otherwise have been spent in
this way that the Oovernnent ean check whatever tendency
to a price rise it nay be producing by its own spending
prograa. And it should be noted here that it is total
spending rather than borrowing which creates the inflation«
effect.
^
«IT*
:- s S i^ l0S^ ~ -
f
recognise that the eoaaerci&l banks will
w
be called upon to finance a large share of the deficit —
in fact, a share of unprecedented magnitude. In the
■onthe — perhaps years — to cone, it is important that
the banks preserve a naxlnua of liquidity. To help thee
to do so, we have decided that securities sold to the
banks should have a range of maturities running froa |
months, in the case of Treasury bills, to 10 years, in
I
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to place their subscriptions before the books closed.
I believe that la the future we shall sake arrange«ents
to keep the subscription books open longer, at least for
nonbanking Investors, so that the Victory Fund Conalttesg
sill have «ore tiae to do their work.
This brings us to a consideration of the place of
the conaercial banks in our financing prograa. 1 have
tried to saph&sise that It is our fir« belief in the
Treasury that we should borrow fro« coaaereial banks
only on a residual basis — that is, to resort to the
commercial banks only after every effort has been aade
to finance the deficit from other sources. We desire —
in so far as we are able — neither to create new noney
nor to activate old aoney. Mon-inflationary financing
require« that we draw in noney that would otherwise have
accrues, but to provide a source of investment for liquid
funds that have been immobilized by wartime restrictions.
The “tap* issue, unavailable to eouercial banks
/
a period of ten years, is designed to attract funds
¥xe
fro* investors who velooae the opportunity to secure a
long-tern investaent at an attractive rate.
In the October offering of $b billion, the books
were open for only two days, and we obtained soaething
like
;
25
percent of total subscriptions iron investors
.
/
.
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:
"
other than eouercial banks. Frankly, we had hoped to do
better, and it is probable that the proportion would have
been increased if the subscription books had been open
longer. There was a considerable delay in the delivery
of nany of the printed circulars, and it seems clear now
that there really was not enough tine for nany investors
11
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duriag this fiscal year. Sven «ore encouraging than the
salts figures is the fact that aors than 20 Billion workJ
arc already setting aside an average of eight percent of
their pay every pay day for fay Bonds. Our goal is to
sake these figures at least 30 Billion workers and at
least tea percent of their pay by the first of January. I
/
/
The Treasury, as you well know, has not overlooked
. -
other possible sources of funds iron outside the banking
systsa. In the sale of the Tax Savings Sot*, the long
term “tap* issues and other Soveraaent securities to
non-banking investors, we believe that a significant
contribution has been Bade to non-inflationary war financisi
/
The fax Savings Mote is designed not only to sake
available to the Government money due from taxpayers
during the period in which the tax liability actually
;
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10
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taxation, we Bust borrow. As investment bankers you art
directly concerned with the Government•e borrowing
policies; and I shall therefore lay ay principal eaphaslt
tonight upon borrowing, although I would remind you that
borrowing is only one facet of our wartins financing
problem. Stationing and direct controls may make borrowing
easier, but they do not eliminate the need for it or
reduce its amount,
fa x
H oc >
'HThe best
bei source^of borrowed funds is, of course,
the sale of War Sawings Bonds, 1 Imagine that erery mas
in this room has given time and thought and energy to
help in this very important part of our war financing.
The results of the sale of War Savings Bonds are good and
growing better; we confidently expect to sell at least
$12 billion worth, and perhaps more, of War Savings Bonds
Wtmmmmmmmm
•
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excess purchasing power by an instrument which stands
•idway between direct controls such as rationing and
the traditional forms of taxation. Spending met be
reduced drastically if the prospective supply of consusm'
goods is to “go around“ at the present price level. What
eouid be wore reasonable, therefore, than a progressive
tax that would give an incentive to saving and put a
penalty upon spending — the very thing that
b u s
!
be
reduced? This is what Secretary Morgenthau proposed last
f *0Bth wl*b the spendings tax. I think that aany people
pasted a rather hasty judgment on the proposed tax at
that tine. I believe that it Is the kind of thing which
looks better and better the nore you consider it,
ask you to wall it over in your own winds.
1/^ ill of the woney which we do not raise by current
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a l l know that incomes are rising, while the
supply of consumers' goods and services is shrinking.
In order to secure a fair distribution of the available
supply of consumers' goods and services at the present
prist level, it will doubtless be necessary to resort to
nore extensive rationing. To secure such an equitable
distribution is the primary purpose of rationing. Ve
should not lose sight, however, of the fact that rationing
is also a powerful instrument of war finance.
Ih&t we cannot spend, we nust save. Thus rationing is
|
really "compulsory saving", and it nay be on a vest scale.
lut even with rationing over a very broad area,
excess purchasing power is likely to result in extreae
pressure, menacing any system of price regulation.
It would be possible to control this pressure of
\
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Bevenue-raising alone does not, however, constitute
the whole of the contribution tares can make to the
I
successful financing of the war, Successful war finance
requires fairly stable prices, and- wise fiscal policy
will help Maintain the». But this is not enough. Other
|
Measures Must also be employed if we are to have price
¡L
stability.
¥ou are all aware of the great forward steps which
have been taken by the President and Congress during the
pent Month in the direction of the stabilisation of our
price structure. The appointnent of Justice Byrnes as
Birector of Economic Stabilisation has given us all a
L
new confidence that the war will be fought through to
U
final victory without serious disturbance of the present
price level.
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ef gIf finance — for it Is only by taxation, either now
or in the poet-war period, that the burden of the war
can be finally distributed.
Much progress has already been made in the field
of taxation. Our total revenue, giving effect to the
passage of the tax bill now in conference between the
House of Representatives and the Senate, will aggregate
about It! billions this fiscal year* This is nearly four
tines our revenue in the fiscal year 19»K>, but only about
one-fourth of our expenditures in this fiscal year.
Measured against the standard of past achievesents, it
is nagnifleent; aeaaured against the standards of present
I'
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needs, however, it is plainly inadequate. We shall need
substantial levies beyond those contained .in the present
y
bm#
i
'X..
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tenfold It amount, they also become different In kind
and nust be net by new procedures.
I have already aentioned that war activities are
going to take up alnoet half of our total production In
tble fiscal year. This naans th at we shall have to live
on the other half of our gross product. He made the
decision to do this when Congress passed the appropriation
for war purposes and when the whole country resolved that
as large a proportion as possible of our total output
should be in war goods.
Finance can and will add no burden additional to
that %feieh we have already contracted for. Wise finance
can and will sake the burden easier to bear« however, by
distributing it aore equitably.
taxation niust fora the foundation for any progran
M
«
ft«®»! year 1918 absorbed less than one-quarter of the
total national production. But in tbe present fise&l
year, our war activities are estia&ted to absorb almost
half of our total produetion.
Tbe anounts which bave already been raised and spun
sinee tbe oenaenceaent of tbe defense progrsa exceed in
aaount all that we spent during tbe last war. These asounti
I
bave been raised without any dislocation in tbe financial
markets and at unprecedentedly low rates of interest —
averaging about 1-3/b percent.
We do not delude ourselves, however, that tbe
financing of a total war can be nerely a money market
operation. Total war requires total effort and total
sacrifies, and tbe financial front can be no exception.
We nust recognise that when our problaes are nultiplied
i
,
-
3
-
the need for ever-increasing amounts of equipment has
tremendously multiplied the financial problems of this
war,
y I n
th® f l m fl,cal r««f
Of
the last war, total
Government expenditures aaounted to about $1U billions.
In the current fiscal year, our expenditures are likely
t® be six times as great«
la the twelve aontfae ended June 30, Ifli, the
Government eolleeted roughly $h billions in taxes. In
the twelve nonthe ending next June 30th, receipts froa
taxes are expeeted to be «ore than five tiaee as great,
totaling about »21 billions..
And here is mother comparison that highlights
the greater dimensions of our war-financing Job tod«? .
During the first World War, our war expenditures in the
The financial problems of the First World War were
precedent-breaking in their tine. In that war, we moved
the deeinal point over a fall place compared with any
thing which had happened previously. It was then that
the tern ^billion” became a part of the common language!
In this war, we have again entered new magnitudes.
In the mobilization of men alone, we are doubling the
figures of the last/"War, Sven so, the nunbers of the
armed forces are an inadequate index of the size of cur
war effort. The amount of equipment required per man
has multiplied many times over. It has been aptly
stated that while in the last war the problem was
"to equip the men“, the problem now is "to man the
equipment” — and before that to produce it. laterally,
1 a» especially glad to be on this program and
at this table with Ambassador Grew. Sis path and nine
■ay seem at first sight to lie far apart ~ his in
diplomacy, mine in fiscal fields. Yet there is one road
that both the Ambassador and I have travelled together.
We belong to that small company of Government officials
who served daring the first World War - or at least part
of it - in the same Federal Departments in which we are
serving today. Hr. Grew was then Counself^af oar Imbassie«
/'
in Berlin and Vienna,-and later at the State Department;
I was serving in the Treasury Department. For each of us
the experiences of that other war of
25
years ago have
provided a standard of comparison for judging the war
effort of today.
is
»early a year ago you, Mr. Fleek. and the heads
of other financial association* of the country cane to
«* and offered the services of their nembers to the
Treasury. Since then our work together has grow» into
a relationship which has becone genuinely important in
the financing of this war.
$
The activities of the Victory Fund Oonnittees.
organized and staffed largely by the bankers and investient
small
h rve ai
in Bf
-in il
bankers of the country, have been of vital assistance in
i(
tan
our Governneat financing operations. You have given your
help generously and patriotically, and I an glad. Mr. Fleet]
i tl
that you have offered ne this chance to say so. I know
that this also expresses the sentiments of Secretary
tar |
Morgenthaa.
l
J St
everfinal
TREASURY DEPARTMENT
WASHINGTON
Press
J
No.
(Ihe following address
of
the Treasury, be f o r e
of America
at
is
by Daniel
the
scheduled for
Time,
Monday.
• Bell,
7 X
Under Secretary
Investment Bankers Association
delivery at
the Waldorf-Astoria Hotel,
Eastern far
W
Service
S 3 -
the
in Hew Tork
O c t o b e r 19.
dinner meeting
City,
1942,
and
at
.
fTicSwfor'
ms afid offered the services of their members to the
Treasury. Since then our work together has grown into
a relationship which has become genuinely important in
the financing of this war.
The activities of the Victory Fund Coaaittees,
organized and staffed largely by the bankers and invests«*
bankers of the country, have been of vital assistance in
our Government financing operations. You have given your
help generously and patriotically, and I an glad. Mr. Fleet,,
that you have offered me this chance to say so. I know
that this also expresses the sentiments of Secretary
Morgenthau.
J
I
TEÈASÜRY DEPARTMENT
WASHINGTON
Press Service
Ho. 33-72
(The following address by Daniel W. Bell, Under Secretary of the Treasury,
before .the Investment Bankers Association of America is scheduled for
delivery at the dinner meeting at the Waldorf-Astoria Hotel, in Hew York
City* at 9*30 p.m., Eastern War Time, Monday, October 19» 19^2, and is fojy
release at that time.;
Nearly a year ago.you, Hr. Fleek, and the heads of other financial
associations of the country came to us and offered the services of their
members to the Treasury. Since then our work together has grown into
a relationship which has become genuinely important in the financing of
this war.
The activities of the Victory Fund Committees, organized and staffed
largely by the bankers and investment bankers of the country, have been
of vital assistance in our Government financing operations. You have given,
your help generously and patriotically, and I am glad, Mr. Fleek, that
you have offered me this chance to say so. I. know that this also expresses
the sentiments of Secretary Morgenthau.
I am especially glad to be on this program and at this table with
Ambassador Crew. His path and mine may seem at first sight to lie far
apart — - his in diplomacy, mine in fiscal fields. Yet there is one road
that both the Ambassador and I have travelled together. We belong to that
small company of Government officials who, served during the first World
War - or at least part of it - in the same Federal Departments in which
we are serving today, Mr. Grew was then Counsellor of our Embassies
in Berlin- and Vienna, and later at the State Department; I was serving
in the Treasury Department, For each of us the experiences of that other
war of 25 years ago have provided a standard of comparison for judging the
war effort of today.
The
in their
compared
the term
financial problems of the First World War were precedent-breaking
time. In that war, we moved the decimal point over a full place
with anything which had happened previously. It was then that
"billion" became a part of the common language.
In this war, we have again entered new magnitudes. In the mobili
zation of men alone, we are doubling the figures of the last war. Even
so, the numbers of the armed forces are an inadeauate index of the size
of our war- effort. The amount of equipment required per man has multi
plied many times over. It has been aptly stated that while in the last
war the problem was "to eqpip the men", the problem now is "to man the
equipment" — * and before that to produce it. Naturally, the need for
ever-increasing amounts of equipment has tremendously multiplied the
financial problems of this war.
-
2
~
In the first fiscal year of the last war, total Government expenditures
amounted to about $lU billions. In the current fiscal year, our expendi
tures are likely to be six times as great.
In the twelve months ended June JQf 1918, the Government collected
roughly $U billions in taxes. In the twelve months ending next June
receipts from taxes are expected to be more than five times as great,
totaling about $21 billions.
And here is another comparison' that highlights the greater dimensions
of our war-financing job today. During the first World War, our war
expenditures in the fiscal year 1918 absorbed less than one-quarter of
the total national production. But in the present fiscal year, our war
activities are estimated to absorb almost half of our total production.
The amounts which have already been raised and spent since the
commencement of the defense program exceed in amount all that we spent
during the la,st war. These amounts have been raised without any dis
location in the financial markets and at unprecedentedly, low rates of
interest — averaging about 1-rffb percent.
We do not delude ourselves, however, that the financing of a total
vrar can be merely a money market operation. Total war requires total
effort and total sacrifice, and the financial front can be no exception.
We must recognize that when our problems e.re multiplied tenfold in amount,
they also become different in kind and must be met by new procedures.
X have already mentioned that war activities are going to take up
almost half of our total production in this fiscal year. ' This means that
we shall have to live on the other half of our gross product. We ma.de the
decision to do this when Congress passed the appropriations for war
purposes and when the whole country resolved that as large a proportion
as possible of our total .output should be in war goods.
finance can and will add no burden additional to that which we have
already contracted for. Wise finance can and will make the burden easier
to bear, however, by distributing it more equitably»
Taxation must form the foundation for any program of war finance —
for it is only by taxation, either now or in the post-war period, that
the burden of the war can be finally distributed.
,
- 3 Much progress has already "been made in the field of taxation. ,Our
total revenue, giving effect 'to the passage of the tax hill now in
conference between the House of Representatives and the Senate, will
aggregate about $21 billions this fiscal year. This is nearly four times
our revenue in the fiscal year 19 ^0 , but only about one-fourth of our
expenditures in this fiscal year, . Measured against the standard of past
achievements, it is magnificent; measured against the standards of present
n e e d s h o w e v e r , it is plainly inadequate. We shall need substantial levies
beyond those contained in the preserit bill.
Revenue-raising alone does not, however, constitute the whole of the
contribution taxes can make to the successful financing of the war. , Success
ful war finance reouires fairly stable prices, and wise fiscal policy will
help maintain them. But this is not enough. Other measures must also be
employed if we are to have price stability.
vL .
You are all aware of the great forward steps which have\ been taken
b y 'the President and Congress during the past month in the direction of
the stabilization of our price structure. The appointment of Justice ,
Byrnes as Director of Economic Stabilization has given us all a new confi
dence that the war will be fought through to final victory without serious
disturbance of the present price level.
You all know that incomes are rising, while the -supply of consumers1
goods and services is shrinking.
In order to secure a fair distribution
of the available supply of consumers* goods and services at the present
price level, it will doubtless be necessary to resort to more extensive
rationing. To secure such an eciuitable distribution is the primary pur
pose of rationing. We should not lose sight, however, of the ¿aco that
rationing is also a powerful instrument of war finance, ^aat we
spend, we must save. Thus rationing is really 11compulsory saving**, and
it may be on a vast scale.
But even with rationing over a very broad area, excess purchasing
power is likely to result in extreme pressure, menacing any system of
pride regulation.
It would be possible to control this pressure of excess purchasing |
power by an instrument which stands midway between direct controls suqh
as rationing and the traditional forms of taxation. Spending must be
reduced drastically if the prospective supply of consumers’ goods is to
/
*'go around*’ at the present price level. What could be more reasonable,
therefore, than a progressive tax that would give an incentive to saving
and put a penalty upon spending — the very thing that must bd reduced? j
This is what Secretary Korgenthau proposed last month with thexspendings
tax. I think that many people passed Ja rather he-sty judgment on the pro-* :
posed tax at that time. I believe that it is the kind of thing which.
looks better and better the more you consider it, and I a,sk you to mull
it over in your own minds.
All of the money Which we do not raise "by current taxation, we must
borrow. As investment bankers you are directly concerned with the
Governmentfs borrowing policies; and I shall therefore lay my principal
emphasis tonight upon borrowing, although I would remind you that borrow
ing is only one facet of our wartime financing problem. Rationing and
direct controls may make borrowing easier, but they do not eliminate the
need for it or reduce its amount.
One of the best sources of borrowed funds is, of course, the sale of
War Savings Bonds. I imagine that ev e r y man
this room has given time
and thought and energy to help in this very important part of our war
financing. The results of the sale of .War Savings Bonds are good and
growing better; we confidently expect to sell at least $12 billion worth,
and perhaps more, of'War Savings Bonds during this fiscal year. Even more
encouraging than the sales figures is the fact that more than 20 'million
workers are already setting aside an average of eight, percent of their pay
every pay day for War Bonds. Our goal is to make these figures at least
30 million workers and at least ten percent of thè ir pay by the first of
January.
The Treasury, as you well know, has not overlooked other possible
sources of funds from outside the banking system. In the sale of the Tax
Savings Rote, the long-term ntaprt issues and other Government securities
to non-banking investors, we believe that a, significant contribution has
been made to non-inflationary-war financing.
The Tax Savings Rote is designed not only to make available to the
Government money due from taxpayers during the period in which the tax
liability actually accrues, but to provide a source of investment for liquid
funds that have been immobilized by wartime restrictions.
The ’’tap^ issue,, unavailable to commercial banks for a period of ten
years, is designed to attract funds from investors who welcome the opportu**
nity to se'cure a long-term investment at an attractive rate.
In the October offering of $b billion, the books were open for only
two days, and we obtained something like 25 percent of total subscriptions
fròm investors other than commercial banks. Erankly, we had hoped to do
better, and it is probable that the proportion would have been increased
if the subscription books had been open longer. There was a considerable
delay in the delivery of many of the printed circulars, and it seems clear
now that there really was not enough time for many investors to place their
subscriptions before the books closed. I believe that in the future we
shall make arrangements to keep the subscription books open longer, at least
for nonbanking investors, so that the Yictory Eund Committees will have more
time to do their work.
This brings us to a consideration of the place of the commercial banks
in our financing program. I have tried to emphasize that it is our firm
belief in the Treasury that we should borrow from commercial banks only on
a residual basis — that is, to resort to the commercial banks only after
every effort has been ma.de to finance the deficit from other sources. We
desire — in so far as we are able — - neither to create new money nor to
activate old money. Ron-inflationary financing requires that we draw in
- 5 -
money that would,otherwise have been spent in buying consumers’ goods. It
is only by drawing in money that would otherwise have been spent in this
way that the Government can check whatever tendency to a price rise it may
be producing by its own spending program. And it should be noted here
that it is total spending rather than borrowing which creates the infla
tionary effect.
'
We must recognize that the commercial banks will be called upon to
finance a large share of the deficit — in fac;fc, a share, of unprecedented
magnitude. In the months — perhaps years — to come, it is important that
the banks preserve a maximum of liquidity. To help them to do so, we
have decided that securities sold to the banks should have a range of
maturities running from 3 months, in the case of Treasury bills, to 10
years, in the case of Treasury bonds.
Interest rates on bills have been
fixed at 3/8 of 1 percent, a rate that is designed to promote the wide
spread distribution of this type of security. The Federal Reserve'System
has posted a buying rate of this amount so that any holder of bills knows
that he can convert them into cash at any time and at this specified rate.
This arrangement has served to increase greatly the flexibility of bills
in the money market and has also aided in the.more effective use of
excess reserves. For all practical purposes, excess reserves can now be
invested In Treasury bills without sacrificing liqui(fil;y. As a result,
we have been able to increase steadily the.amount of bills outstanding so
that today more than 2-1/2 times as much is outstanding in bills as on
December 7.
In addition to this large increase in bills, we have also revived the
use of another short-term security — the certificate of indebtedness.
Beginning in April of this year, we have thus far sold four certificate
issues, approximating 1—l/2 billion dollars each. Together with bills,
the certificates provide a large supply of short-term paper, and thus add
a large measure of liquidity to the banking system. Incidentally, it should
be remembered that this liquidity is going to be a Very welcome offset to
declining capital ratios, and will make it easier for banks to adjust
themselves to the need of shifting deposits from area to area, a process
that seems likely to continue.
In securities
the banks Treasury
years. This means
sold to commercial
of over one-year maturity, we have continued to offer
notes, and Treasury bonds with a term of not over ten
a maximum interest rate of two percent on Treasury bonds
banks.
It may seem at times that banks are being discriminated against in not
being permitted to subscribe for longer-term securities which bear higher
interest rates than two percent; but this is not the^ case. The Govern
ment would certainly be doing the banks no favor if it permitted them to
load themselves with long-term issues. You may recall that the report of
the Economic Policy Commission of the American Bankers Association, issued
last April, concluded that securities sold to banks should be limited to
a ten—year maturity.
I think all of you will agree that a frozen banking
system trying to become unfrozen after the war by selling long-term Govern
ment securities might create a bad situation.
- 6
It should also he noted that a large part of the securities which will
he bought by brinks will be financed by increases in deposits for the banking
system as a whole. It seems reasonable that the interest rate on securities
financed in this manner should be kept down to & maximuni of two percent —
regardless of the maturities involved — because the costs incurred by the
banks in making loans direct to the Government, and in handling the increased
deposits resulting from these loans, are small. ^Furthermore, from the point
of view of the cost of. financing the war, interest rates should be kept as
low as is compatible with the objective of financing the war as much as
possible outside of commercial banks*
I think you will have seen by now that our financing program has taken
on a clear and well-considered pattern. Naturally this program constitutes
only a working framework of principles. We shall, of course, endeavor to
improve it and in doing so may make further changes in the types of securi
ties offered, especially to nonbanking investors, and in the methods of
offering them.
I have no doubt that you will all agree with the objectives of our war
financing policy. We all realize that a great deal more remains to be done
in financing the deficit as far as possible from outside the commercial
banking system. To the extent, however, that we must resort to the'
commercial banks, it is imperative that interest rates be kept at prevailing
levels and that the maximum'of liquidity be preserved.
The success of our war financing depends upon attaining these objectives.
We at the Treasury have had abundant evidence that the banking and security
industry knows full well what is at stake. We know that we can continue to
count upon your cooperation.
0O0
si
TREASURY DEPARTMENT
Washington
(The following address by Randolph E* Paul, General Counsel,
before the National Tax Conference, Cincinnati, Ohio, is
scheduled for delivery at 3:30 P«M., Eastern War Time,
October, 21, 19^2, and is for release at that time.)
The Income Tax in Total War
In total war the tax system is a vital part of the nation's armory.
Of all tax weapons the income tax is the most powerful and the most re
liable.
The stake in total war is survival. Taxes play a crucial part in
the conflict, for they can impede or stimulate the war effort. It is
vital that we persevere in our efforts to adapt the fiscal program to
the vast and changing requirements of war. There must be no shadow
of doubt that the tax system is making its maximum contribution to
speedy and decisive victory.
Three aspects of taxation are especially important in time of war:
Its effect (l) on the control of inflation, (2) on maximum production,
and (3) on the distribution of the war burden.
The Control of Inflation
|
Taxation must play a major role in the control of inflation. The
incomes of individuals are far in excess of the consumer goods and ser
vices flowing to .the market. Income payments to individuals are
currently running in the neighborhood of $115 billion a year, and the
flow of consumer goods and services is currently running in the neigh
borhood of $80 billion a year. Income payments are bound to rise to
a level of at least $120 billion in 19 U3 . At the same time the flow
of consumer goods is bound to decrease. The use of these enlarged in
comes, in bidding for the declining supply of goods and services,
creates an irresistible pressure on prices. Taxation must remove
enough of the excess purchasing power to keep this pressure within
reasonable bounds. For this purpose the personal income tax is our
best weapon. It is graduated according to size of income, and if
adequately modified, can be imposed at rates sufficiently high to
yield the necessary revenue without encroaching on the essentials of
subsistence. Moreover, with the use of, an adequate withholding device,
it, can withdraw purchasing power from the majority of consumers promptly
3 3 -7 3
~ 2 -
and efficiently. The income tax can accomplish all these things without
disturbing price ceilings and without affecting cost of living indices
often used in fixing wages.
Maximum production
Total war requires maximum production of the implements of war and
of the civilian goods essential to efficiency and public morale. Total
war requires, too, the prompt termination of non-essential production.
Of all the elements in the tax system the income tax can contribute
most to the expansion of war production. The t a x a p p l i e s to the business
man only after he has covered his costs; it applies to the worker only
after earnings exceed his family's requirements for a sufficiently high
standard of living to permit heavy and sustaining product!
^
At the same time, the income tax is sufficiently discriminating
force a reduction in non-essential consumption, releasing labor,
materials, equipment, and transportation facilities for indispensable
war production.
The distribution of the war burden
She tax system is a prime factor in t h e «Jui*a^ e(, ^ f
the real cost of the war. . I use the phrase "the £eal oo»t
in contradistinction to "the monejr cost of *he_war«.
^te^iS
of staggering proportions, to be sure, but it is
The real cost of the war —
the cost we must bear here and now
¿ r a t a ls ; z
and cannot avoid - 1 « the aidless
continue exerting day in, day out, at the same time sna
t
° fe l i a b l e
lif
but-by the relentless pressure of the war. In some r P
be forced to undergo actual hardship. These are real costs of the war.
H o w e v e r ! if w^disfribute them equitably,
the war need-not encroach on
the essentials of subsistence*
It is the function of the tax system to distribute these real
costs of the war fairly and equitably. The i'Adome tax dpes so. *
the use of personal exemptions, which «crease with^he^sise^of^ ^
family, it assures that no tax burden will
comes are not above subsistence levels. It measure
the burden according to personal income «posing^the
sacrifice on those best able to pny.
d dlstributes
3 r
high standards'of living to reduce tiieir consumption of commodities and
services not essential to subsistence, physical well-being, and civilian
morale.
The limitations of the income tax
As an instrument of war finance the income tax is without equal*
We must recognize, hurwever, that in total war a point may eventually
be reached when further extension of the income tax along orthodox
lines will encounter difficulties.
Limitations of the present definition of income for income ,tax
■purposes present a case in point. Certain types of income suen as
home-produced commodities, are not taxed. Some items, which are not
income, may be subjected to tax. The expense of getting to and from
work, and of moving to take a n e w job, are illustrations. Some of the
defects of the income tax, such as the exemption of interest from
State and local securities, could be remedied by appropriate legisla
tion. Others, however, such as the problem of including the rental
value of an owner-occupied house in income, are exceedingly difficult
to solve. Geographic differences in cost of living, problems o
capital gains and losses, and the specification of deductions create
still further difficulties. Other limitations grow out of faulty
definitions of the taxpayer-unit; the Treasury*s efforts to require
the filing of joint returns may focus attention upon one major defect
in the present'law, but there are others as well. In many respects
the calculation of income is still an inexact science.; Every increase
in the severity of the tax adds to the gravity of its imperfections.
Income taxation adequate to siphon off sufficient purchasing power
to remove the danger of inflation will require the extension of high ■ {
tax rates to lower incomes as well as sharp increases in rates on higher
incomes. This may have an adverse effect on the
Labor
groups to make the exertion required for an all-out war
I
mav be reluctant to work overtime, and married women may be hesitant
to accept
jobs, if too large a part of the additional income is
taken by the income tax. Business men who are in a position to make
investments useful to the war effort may hesitate in the face of very
high tax,rates.
A further limitation on the continued extension of the income tax
results from the fact that when tax rates w?re-ah pea° ® f
individuals assumed long-term obligations w m c h they are unabl
adjust^on reasonable terms. Ihey have
large parts of their income to the repayment of debt, llfe ^ ura
premiums, mortgage payments, and other savings programs. f V o i d a b l e
war will inevitably impose personal hardships, the addition of avoidable
burdens makes no contribution to the war effort* Recent increases in
tax rates have been so sudden that many'taxpayers have not been able to
rearrange their financial affairs* Further increases of .sufficient^
magnitude to meet present and prospective needs might be unnecessarily
-harsh in their impact on large numbers of taxpayers»
Although we can place still greater Reliance on thé income tax
in its present form, the time is not far distant when we shall have
to adapt it to conform to changed conditions or be forced to accept
•less desirable alternatives#
A post-war credit
The introduction of a post-war credit is one form of adaptation
which merits immediate attention# It makes possible a further broaden
ing, of the income-tax without affecting adversely individual incentives
and-equities* It satisfies financing requirements and the need for im
mobilization of consumer purchasing power during the war and at the
same time the individual is compensated with the knowledge that his
sacrifice is only' temporary.. It would permit equitable adjustment
for persons with fixed commitments# It would mitigate many injustices
arising out of defects of the income tax#
There are, as so often in taxation, considerations on the other
side. The use of the post-war prédit' involves borrowing, not taxing.
The magnitude of the public debt gives impelling force tp the argu
ments that the Government should place maximum reliance upon taxation
rather than .borrowing* Also, millions of taxpayers, knowing that
accounts are being built up for tjpeir post—war use, may be inclined'
to draw on capital,or curtail other savings in an attempt to maintain
consumption. These are some of the reasons why the post-war credit
would be most effective at the lower income levels*
N
I
'
I
Special tax on increases in incomes
1
Another possible modification in the form of the income tax •
would be a special tax on increases in individual incomes,. Such a
supplement to the income tax has' considerable appeal in time of war
because some individuals enjoy substantial increases of income as a
direct result of the \war, and because individual proprietorships and
partnerships are exempt from the excess profits tax although in some
cases their rate of profit is very substantial^
Such a tax, however, has serious shortcomings# If it were im
posed at rates high enough to produce substantial revenue it might
very seriously endanger war production#.
«
* 5 -
A substantial part of the recent increases in national income
represents higher wages earned by those in the lower income groups.
In many cases these higher wages result from steadier employment, v
longer hours, extsra pay ¿for overtime, and bonuses for extra output.
The^combination of a special tax on increases In Individual income,
together with the recent and prospective increases in the regular
income tax, at the same time that many workers are called upon to
pay income taxes for the first time, might seriously deter individ
uals from exertinglthe maximum war effort.
A special tax on the excess of current income over the ¿income in
a specified base period would discriminate against certairp^groups of
taxpayers. The most conspicuous instance perhaps is the case of an
individual whose income was abnormally low In the base period, or who
was unemployed and was entirely without income in the base period. It
is doubtful" that of two individuals, each receiving a $2,000 income in
19I+2, the one who had no income in the base period has a greater
current taxpaying ability than the other who earned $2,000 continuously
over the past six or eight years, ' Presumably, the individual With the
steady income, who has been able to maintain his person and property
in good repair, is at least as well able to bear the war burden as
the worker who is employed for the first time in years,
A tax on increases in the incomes of individuals would be es
pecially burdensome in the case of a member of the family who becomes
a wage earner to compensate for the loss of earnings of another member,
of the family who has become unemployable or who has been called.for
military service. Where a son or husband has entered the armed 6er~
vices the family income is likely to be reduced even though the wife
pr another member of the family receives a larger income now thah in
the base pefiod. In all probability, under a special tax on increases
in income, inequity to this kind of case could not be avoided} and
from present indications there will be millions of such cases.
A super-tax of this type would impinge also on normal increases
in income not in any way connected with war profits, The modest in
crease in the salary of a postman, fireman, or school teacher in
accordance with an established promotion schedule is an example.
The tax would bear with particular weight on those who are at
present establishing themselves professionally. An engineer who after
years of study and training finally secures a post illustrates this
type of case. The craftsman who, as a result of the war, is for the
first time afforded an opportunity at work Of greater responsibility
and skill within hib competence illustrates another.
n
« 6
The administrative problems involved in ascertaining what Individ«
uals were liable to this tax, and in determining the amount of their
tax liability, would be extremely burdensome* l'or the great body of
taxpayers, no means would be available for checking on the income in
the base period# Income tax records would be available for only a
relatively small number, because until recently high exemptions
excluded most of the public from the requirement of reporting#
In
addition, many persons who have no intention to evade taxes simply
do not have accurate Information about their income in past yeeys#
A tax of this type would probably contain extensive relief pro«
visions to safeguard individuals with abnormalities in base period
income, or with extraordinary income in the current year, particularly
where income is derived from small proprietorships and partnerships*
The administration of these relief provisions would present major
problems*
These considerations, together with the fact that any practicable
scheme would yield little revenue and contribute even less to the con
trol of inflation, make inadvisable this modification of the income
tax*
The spendings tax
The time has come for supplementing the income tax with another
progressive element which places the emphasis on money spent rather
than income received- X have reference to the spendings tax. Such
a supplement has distinct advantages over indefinite increases in the
scope of the personal income tax» It discourages spending, and does
not impose a tax on those portions of income devoted to Savings and
discharging fixed commitments*
Under a spendings tax it is possible to provide for whatever
exemptions and deductions are deemed necessary to the national wel«
fare. With the use of progressive rates, the burden can be distrlbuted in a predetermined pattern. To the extent that
produced by the spendings tax the Treasury benefits, To the extern;
that individuals avoid the tax by not spending, the pressure
In
flation is released. The resultant personal savings
for borrowing by the Government, either directly from the individual
or indirectly from financial institutions*
The spendings tax appears to be an excellent instrument from the
point of view of nubile morale, as well. It leaves the individual
substantial scope for choice, In deciding upon the a m o u n t o f h i e
spendings the individual can feel that to a considerable extent he
~7 ~
is assessing himself» To the extent that he avoids spending he con
plan on enjoying his income in the post-war period, when consumers
goods and services will again he abundant, — - perhaps more abundant
than ever before.
The soendings tax and the sales tax
Ihe need for reducing the volume of consumer spending during war
time is recognized by all. Some, however, would accomplish this re
duction by means of a general sales tax.
The main argument in favor of the sales tax is that it reaches
every consumer in the country. But it does so in decreasing measure
as the goods normally covered by a sales tax become unavailable. And
unless the list of items subject to the tax is greatly extended, its
yield will fall of substantially. The spendings tax has the advantage
that a shift of spending to services and other items not usually sub
ject to a general sales tax leaves the size of its base unaffected.
The spendings tax employs the principle of graduation, and grants
exemptions according to need. It thereby differentiates among taxipavers on the basis of ability to pay. Despite the increase in aver
age income in recent months many workers have income insufficient »to
permit maximum physical efficiency. We should be ill-advised to
collect taxes at the expense of the productive efficiency of our
workers.
The spendings tax is also better adapted to distinguishing be
tween «luxury« and «non-luxury” spending than is the sales tax. When
the tax applies to specific commodities, as under the sales tax, it
is necessary to classify them for purposes of establishing their rates
according to some criterion of luxury. If commodities are enumerated,
knotty problems of definition arise, which add greatly to administra
tive difficulties. If price is made * he criterion, many goods are
taxed at the higher luxury rates merely because the goods are made to
last longer. Furthermore, if general prices are rising, some com"
modities become luxuries merely because their prices have risen. The
spendings tax does not require these difficult decisions as to wha
constitutes luxury; the basis for graduating the rates is the total
spending of the individual. If his spendings are high it is pres L e d that they are devoted in part to luxuries,
^
tased
accordingly. Furthermore, the spendings tax oan make aUowanoe for
size of family, whereas the sales tax increases the burden the larg
the number of dependents*
A further advantage of the spendings tax over a s a l e s t a x i st h a t
it does not tend to enter into cost of productions hence it does not
contribute to price inflation.
-8 -
- The spendings tax offers no stimulus to inflation; Since the tax
is on spending in general, rather than on specific items m the cost
of living index, there would he little disposition for individuals to
associate payment of the tax with a rise in cost of living. Again,^
since all expenditure of businessmen is exempt from the tax, there is
no danger of driving up cost of production through a tax on inter
mediate goods.
The spendings tax has advantages when applied to either end of
the income scale. The objection has been raised that the graduated
spendings tax cannot function in the higher brackets because the in
come tax rates are already high. But throughout much of the range of
higher incomes, rates in this country are net so high as in Great
Britain or Canada, and there is room for further increases, But more
important.; the spendings tax applies to the. ^endings, not to the
income, of 'ohose whose income tax brackets are high. If these^ indi
viduals retrain from spending they do not incur ohe upper bracket
rates of the spendings tax, If, on the other band, they spend out of
their capital, it is n o inappropriate that they incur tax liabilities
on their excessive spendings,., There is no justification in permitting
those with a backlog of savings to maintain their consumption at a
level high above that of the remainder of the‘population at a time
when fewer and fewer consumers* goods are available.
At the lower end of the income scale the spendings tax does not
differ substantially from the income tax. In these brackets income
and spending do not greatly diverge. But there is an advantage in
making use of the spendings tax to supplement the income tax, because
it affords low income-receivers an option to reduce their current con
sumption or increase their tax liability.
The sales tax abroad
Much of the support given the sales tax stems from the erroneous
belief that foreign countries have found the sales tax an indispensa e
and primary weapon of war taxation. Actually, most European countries,
just as our own States, introduced the sales tax not in time of war
but at a time when other revenue measures became unproductive. *«3y
adopted it in depressions when the income tax base disappeared and m
periods of hyper-inflation when income taxes assessed one day became
meaningless the next#
In Great Britain and Canada the relative importance of sales taxes
and customs has Reclined as the war has progressed.'
The United States already makes considerable use of taxes on consumption. in lÿ+2 the ratio of sales taxes and customs to total taxes
9 -
imposed by &11 levels of government was 25*2 percent in the United
States* The corresponding ratio for the United Kingdom was 30*2 per
cent, — and that includes the Purchase Tax*
Canada makes important use of consumption taxes, hut the ratio
for the Dominion, which was 5 1 •£> percent in the fiscal year 19 2, is
estimated to decrease to 3^*6 percent in the fiscal year 19^3•
is significant that so far as the general sales tax is concerned,
Canada adopted it long before the War and has consistently refused
to increase it for purposes of war finance*
The British Purchase Tax applies high rates to a very wide-range
of commodities hut leaves numerous articles untaxed. In fact, it
applies to substantially less than 20 percent of consumer expenditures.
Three principal groups of commodities are not taxed, (1) absolute
necessities, including food, coal, and utility services, (2) goods
alreadv taxed, such as gasoline, tobacco, and drinks, and 1,3)
industrial machinery and equipment and materials. The expected yield
in I9Ü 2-U 3 is only 80 million pounds, less than 3 percent of national
and local revenues* This represents a decline from about k percent
in 19U1-U2.'
Foreign experience confirms our conviction that the sales tax has
■ little to contribute to, and in fact may handicap, war finance.. We
must indeed discourage consumption by taxation. We can best accomplish
that purpose by incorporating the post-war credit device and the
spendings tax into the structure of the income tax.
Conclusion
It is twenty-nine years to the month since the present income t
tax became law. By 1917» when we entered the war, the new tax was m
working order. This was indeed fortunate, for we found in the per
sonal income tax a fiscal instrument that proved to De capable of
rapid extension to meet the demands of war. Now, we are confron e
with revenue needs far greater than during the last war. In the mean
while, however, we haie had a quarter century of experience with the
income tax. That experience buttresses the belief that the income
tax is a potent instrument of war finance, capable with expansion
and extension of meeting the demands of this war. We dare not fail
to use that weapon fully and effectively.
IN DIVIDU AL IN CO M E TAX
UNITED STATES, UNITED KINGDOM AND CANADA
Effective Rates for Married Person without Dependents
PER
CENT
6
10
20
40
60
100
200
400
NET IN C O M E IN T H O U S A N D S O F D O L L A R S
OfficeoftheSecretaryoftheTreasury
Division of Ta« Research
600
1000
INDIVIDUAL INCOME TAX
Effective Rates for Married Person without Dependents
1918 and Selected Taxable Years
OfficeoftheSecretaryoftheTreasury
Derision of Ta* Research
B-355
fsSASORT ngPARU fggT
Washington
FOK RSLEâ SE, M û RNIRG SEiSPAPéRS
ftmdMr. O c U b t r 20« 1942.
Prose Service
33-7^ î
The Seeretary of the Treaeury announced last evening that the tendera For
#500,000,000, or ther©abouts, of 91-day Tre&sury bille to be dated October 21, 1942,
and to mature January 20, 1943, which «are offered on October lé, ver# opened at the
Fédéral Reserve Banks on October 19*
The details of thie issue are as followst
Total applied for « #904,042,000
Total accepted
- 505,072,000
Range of aeeepted bide:
Higb
Lee
Average pries
- 99*925 équivalent rate ef discount approx. 0.297% per annua
- 99.905
•
»
»
«
»
0.37« *
*
- 99.906
»
»
»
*
«
0.373* »
»
(36 percent of the ancrant bld for at the le» prise vas accepted.)
\V
TREASURY DEPARTMENT
Washington
FOR RELEASE, M O R N I N G NEWSPAPERS,
T u e s d a y , O c t o b e r 20, 1 9 ^ 2
Press Service
No*
10/19A2
The
the
Secretary
to b e d a t e d O c t o b e r 21,
which were
offered
serve Ba n k s
The
on O c t o b e r
on O c t o b e r
details
of t h i s
issue
applied for
accepted
Range
of a c c e p t e d b ids:
v*crh
_ QQ
^
J
• bow
_ .09
y y *9y0y5
Average
Price
- 99*906
percent
of the
announced
last
or thereabouts,
19^2,
evening that
of 9 1 - d a y T r e a s u r y
anfl to m a t u r e J a n u a r y
l6, were
opened
20,
19^3»
at t h e F e d e r a l R e -
19•
Total
Total
- s
(36
the Tre a s u r y
f o r $ 50 0 . 0 0 0 . 0 0 0 ,
tenders
bills
of
a re
as f o l l o w s :
- 196^,^^2,000
505,072,000
Eauivalent
n
rate
ft
of
-n
discount
n
a p p r o x . 0,297$
per annum
*!
0 Oannum
7^
p er
0*373$
t>er a n n u m
amount bid
f o r at
-0 O 0 -
the l o w p r i c e w a s
accepted. )
V*Ä
Date
Authorized
Number and
Percentage
of Dividend
Authorized
Distribution
of Funds by
Dividend
Authorized
Total
Percentage
Authorized
Dividends
to Date
Number of
Claimants
Amount
Claims
Proved
Name & Location of Bank
Nature of
Dividend
Washington park: NB of
Chicago, Illinois
Final
9“l6,»i42
9th
1.22*
$ 81,500
71.22*
23,595
$6,680,000
Capital NB of
Lansing, Michigan
Final
9-22-42
6th
4.83*
535,290
89*83#
23,211
11,000,000
The Ozone Park NB of
New York, N*Y*
Final
9-17-42
4th
10.87*
138,400
83.87*
5,080
1,273,900
Salt Springd NB of
Syracuse, N*Y*
Regular
9-12-42
7th
10*
363,900
97.5*
4,222
3,639,000
The Second NB of
Erie, Penna*
Final
9—3—42
5th
11.45*
750,000
67.45*
6,859
6,551,000
The Keswick NB of
Glenside, Penna*
Regular
9-17-42
2nd
12*
134,600
77*
6,002
1,100,000
Penn NB & Tr Co
Reading, Penna*
Final
Partial Int.
9-30-42
6th
10.15*
307,200
100.15*
8,847
3,027,100
The First NB of
Webster Springs, W*Va*
Final
9-21*42
6th
14.05*
49,900
94.05*
1,406
355,200
/O
TREASURY DEPARTMENT
Comptroller of the Currency
Washington
/
^
3 3 ~I
FOE RELEASE, MORNING NEWSPAPERS.
Press Service
During the month ended September 30, 1942 , authorizations
were issued to receivers for payments of dividends to the creditors
of eight insolvent national banks*
Dividends so authorized will
effect total distributions of $2,360,790 to 79>222 claimants who
have proved claims aggregating $33,626,200 or an average payment of
7.02 percent.
The minimum and maximum percentages of dividends
authorized were 1.22 percent and 14.05 percent, while the smallest
and largest payments involved in dividend authorizations during the
month were $49,900 and $750,000, respectively.
Of the eight dividends
authorized during the month, two were regular payments, five were
final payments, and one was a final and partial interest payment.
Dividend payments so authorized during the month ended September 30,
1942, were as follows:
M
j
TREASURY DEPARTMENT
C o m p t r o l l e r of t h e " C u r r e n c y
Washington
P r e s s Service
No. 33-75
F O R RELEASE, MORNING- NEWSPAPERS,
Wednesday, O c t o b e r 21, 19*4-2.
g p p p i -------—
D u r i n g the m o n t h ended S e p t e m b e r 30,
19*4*2, a u t h o r i z a t i o n s
were i s s u e d to r e c e i v e r s fo r p a y m e n t s of div i d e n d s to the
cre d i t o r s of eight insolvent
a u t h o r i z e d w ill
na t i o n a l banks.
Dividends
so
effect total d i s t r i b u t i o n s of $ 2 , 3 6 0 , 7 9 0
to
79 » 222 c l a i m a n t s w h o have p r o v e d claims a g g r e g a t i n g
$ 3 3 , 6 2 6 , 2 0 0 or an average p a y m e n t
of 7 » 02 percent.
The mini
mum and m a x i m u m perc e n t a g e s of d i v i d e n d s a u t h o r i z e d w ere 1.22
percent a nd 1*4- . 0 5 percent,
ments
w h i l e the smallest an d largest p a y
i n v o l v e d in d i v i d e n d a u t h o r i z a t i o n s d u r i n g the m o n t h
were $*4*9,900 a n d $750,000,
respectively.
dends a u t h o r i z e d d u r i n g the month,
five wer e final payments,
interest payments.
two wer e r e g u l a r payments,
an d one was a final a nd p a r t i a l
Dividend payments
m o n t h ended S e p t e m b e r 3°,
Of the eight d i v i
so a u t h o r i z e d d u r i n g the
19*4-2, wer e as follows:
DIVIDED PAYMENTS TO CUED ITOPS OP ’INSOLVENT NATIONAL
BANKS AUTHORIZED DURING THE MONTH ENDED
____________ SEPTEMBER 30. 19*+2_____________________
Distribution
of Funds by
Dividend
Authorized
Total
Percentage
Authorized
Dividends
to Date
Number of
Claimants
81,500
71.22$
23.595
$6,680,000
Date
Authorized
Number and
Per centage
of Dividend
Authorized
Final
9-16-42
9th 1 .22$
Capital NB of
Lansing, Michigan
Final
9-22-42
6th
4. 83$
535,290
89.83$
23,211
11 ,000,000
The O z o n e Park NB <Df
New York, N.Y.
Final
9-17-42
4th
10.87$
138,400
83.3754
5,080
1,273.900
Salt Springs NB of
Syracuse, N.Y.
Regular
9-12-42
7th 10$
363,900
97.5$
4,222
3,639,000
The Second NB of
Erie, Penna.
Final
9-3-U2
5th
750,000
67.w
6,859
6,551,000
The Keswick NB of
Glenside, Penna.
Regular
9-17-42
2nd 12$
134,600
7754
6,002
1 ,100,000
Penn NB & Tr Co
Reading, Penna.
Final
Partial Int.
9-30-42
6th
10.15$
307,200
100.15$
8,8^7
3,027,100
The First NB of
Wehster Springs, W .Va.
Final
9-21-42
6th
14.05$
49,900
94.05$
l,4o6
355.200
Name & Location of Bank
Nature of
Dividend
Washington Park NB of
Chicago, Illinois
11.45$
$
Amount
Claims
Proved
Amount and effective rates of individuad income tax, Victory tax, and
combined tax under the Revenue Act of 19^-2
Married person —
Two dependents
(Continued-— 2)
Footnot es :
1J
Z]
3]
Maximum earned net income assumed,
Computed by assuming that deductions are 10 percent of Victory tax net income; i*e., that Victory
tax net income is ten-ninths of net income shown,
Taking into account maximum effective rate limitation of 90 percent.
Amount and effective rates of individual income tax, Victory tax, and
combined tax under the Revenue Act of 19^2
Married person —
let income
before
personal
exemption
'*
•
]
Individual
income
tax l/
9
500
600
700
800
900
1,000
1,200
1,500
1,800
2,000
2,500
3,000
4,000
5,000
6,000
8,000
10,000
15,000
20,000
25,000
50,000
100,000
500,000
1,000,000
5,000,000
—
-
—$
13
99
191
376
592
810
1,322
1,91^
3,756
6,088
8,Sl4
24,845
63,^79
413,384
853>384
4,373,364
Treasury
footnotes :
Amount of tax
Victory tax 1
after
;
post-war
:
credit 2/
4
See page 2
$
1
7
ir
14*
20
29
39
45 ■
60
76
107
136
169
231
294
449
605
760
l.5\7
26,5^7
U5,Hl6 ¿/
125.:
“n 6 2/
Two dependents
Effective rate
* Individual : Victory tax '•
;
aft er
; Combined
1
income
tax
: po st— war
•
*
tax 1 J
: credit 2 / ;
»
t
•
Combined
tax
1
4
7
11
14
20
29
39
58
159
267
485
730
979
1,553
2,208
If,207
6,693
9,574
26,392
67,803
439,931
898,000 ¿/
4,498,000 ¿/
_
m
«
•
'K
—
—
-
.7$
4.0
6.4
9.5
ll.S
13.5
16.5
19.1
25.1
30.4
35.3
49-7
63.5
82,7
85*3
87*5
0*2$
0.2$
0,6
0.9
1.2
1.4
1.7
1.9
2,2
2.3
2.4
2.5
2.7
2.8
2.8
2.9
2.9
3.0
3.0
3.0
3*1
4,3
5*3
^*5
0.6
o#9
1.2
1.4
1.7
1.9
2.2
'-'.T
6.9
12.1
l4 * 6
1 6.3
19.4
22.1
28.0
33*5
36.3
52,8
67.8
8 8 .0
¿/
2.5 n
69*6 ¿/
90.0 ¿/
AMOtHJT AHD EFFECTIVE RATES OF INDIVIDUAL INCOME TAX, VICTORY TAX, AND COMBINED TAX UNDER THE REVENUE ACT OF 19^2
SINGLE PERSON - NO DEPENDENTS
Net income
before
personal
exemption
$
500
6oo
700
800
900
1,000
1,200
1,500
$
126
181
236
' 273
2,500
3,000
365
U72
6 86
920
1 ,17 ^
8,000
10,000
15,000
'20,000
25,000
50,000
100,000
500,000
1 ,000,000
5 ,000,000
2
6
10
$
89
2,000
5,000
6,000
Amount of tax
î
Victory tax :
1 / ; after post-war ;
credit 2 j
:
•
15
3^
52
71
1,800
4,000
IrufM
;
; Individual
: income tax
•
2,390
25.811
64,64i
4i4,6i6
854,616
i + ,3 7 » + ,6 1 6
l4;
85
IS
27
39
52
107
153
60
81
393
602
1
2 .5#
• jf>
.9
1.3
4.9
6.5
7.8
1 .6
1.8
8.9
10.5
1 2 .1
2.3
333
13.1
13.7
2.9
3.0
446
l4.6
574
829
15 .7
17 .2
3.2
3.H
3.6
1,105
1,401
18.4
19.6
3-7
2,052
21.8
2.783
if, 968
23.9
29.1
34.1
38.5
220
288
185
227
310
.
•
17
>+0
62
$
1'43
4,366
6,816
9,626
Combined
tax
102
i,7*+2
•______________ Effective rates---Victory tax 1
Individual
after
post-war :
. inenmfi t . a r 1 / *
credit 2 /
:
810
7.626
1,0 18
10,644
2 .2U7
5 ,021+
28,058
69,665
27,2“+7
3 / 44,884
3 / 124,884
441,863
.
1 / 899.500
6 ,¡+99.500
1/
51.6
64.6
82.9
85*5
87-5
2.6
3.8
3-9
3.9
4.0
4.1
4 .1
1
•
I Computed "by assuming that deductions are 10 percent of Victory tax net income;
;
i. e.
income is ten-ninths cf statutory net income shown in stub.
3/ T a k in g i n t o
*
33-ffe
a c c o u n t maximum e f f e c t i v e
v,
ra te
lim ita tio n
o f 90 p e r c e n t .
—
■
» G
7
«
r
o
c
L
e
^
>«
Sff ec-ti
.
-
H.5
5.0
5-^
/ U.5
1 /
2-5
Combined
tax
2 .8$
5*7
7.8
9.^
10 .7
12.8
14.7
16.0
16 .7
17.8
19 .1
20.7
2 2 .1
23.4
25.7
27.8
33.1
38.1
42.6
5 6 .1
69.7
88.4
1 / 90.0
1 / 90.0
that Victory tax net
AMOUNT AND EFFECTIVE HATES OF INDIVIDUAL INCOME TAX, VICTOR! TAX. AND COMBINED TAX UNDER TUB'REVENUE ACT OF 1 ^ 2
"MARRIED PERSON - NO DEPENDENTS
*
A M O U m AHD EFFECTIVE RATES OF INDIVIDUAL INCOME TAX, VICTORY Ta X, jJID COMBI KEF TAX "UNDER THE REVENUE
M a ERIED' PERSON « ONE DEPENDENT
Note:
Due to rounding* items will not necessarily add to totals*
a CT
OF 19te
Amount and effective rates of individual income tax, Victory tax, and
combined tax under the Revenue Act of 19**2
Married person —
Ret income
before
personal
exemption
;
:
:
' ___________ Amount of tax_______ _________ ____________Effective rate
Victory tax
Individual ; Victory tax :
Individual 1
after
Combined
ï
after
:
income
:
income
* post-war
tax
;
post-war
:
tax 1 /
:
tax l/
*
credit 2 j
•
credit 2/
:
j
!
•
-
t
500
6oo
700
$
$
«
-
goo
_'
—
-
1,800-
2,000
2,500
3,000
$
**,000
5,000.
6,000
11
1**
20
29
39
29
39
58
159
45
60
76
378
592
810
13S
25,000
50,000
100,000
500,000
1,000,000
5,000,000
413.384
853.384
4.373.384
l*
7
11
1**
20
191
3.758
6,088
8,81**
2**,8**5
•
~
169
231
29**
****9
605
760
1.547
4,324
:26,547
45.416 i t
**.0
6.**
**85
7^0
979
1,553
2,208
9.5
11.8
13*5
4,207
6,693
9.574
25*1
30.**
19.1
67,803
439,931,
35*3
.
-
0.2 >i
0*6
0.9
1.2
1.** .
0.2^0
0.6
0.9
1.2
1 .**
1.7
1.7
1.9
1.9
2.2
2.3
2.**
2.5
2.7
2.8
49.7
63.5
82.7
•
2.2
2.9 .
6.**
8.9
12.1
l**.6
16.3
19.**
2.8
2.9
2.9
3.0
3.0
3.0
• 3.1
^3
5.3
16.5
26,392
,
1
~
■l i
267
107
63.^79
^
:-
:
: Combined
tax
;
:
22.1
28.0
33.5
38*3
52.8
67.8
88.0
89-9 l l .
90.0 2 /
4.5 2/
85.3
2.5 2 /
-87.5
125.416 1/
1
_______________
Maximum earned net income assumed.
.
Computed by assuming that deductions are 10 percent of Victory tax net income; i.e., that Victory
tax net income is ten-ninths of net income shown.
3;/ T a k i n g
-
1
13
99
1,322
1,914
8,000
10,000
15,000
20,000
1
*1
$
_ **
7
-
900
1,000
1,200
1,500
i f
2j
Two dependents
~
.
’
in to
a c c o u n t , maximum e f f e c t i v e
.................
.......
.......... - :
ra te
898,aoo ¿/
**,**98,300 ¿/
lim ita tio n
o f 90 p e r c e n t »
..................- - ................................. - -- ----------- ------ :.. --
-------- -
-
............. —
' —
-------
rH|<\)|
S E S t t o n . are 10 percent o f Victory tax net incone; i.e.. that Victory tax net income is
]
1 /
ten-ninths of net income shown.
....
* nri
Taking into account maximum effective rate limitation of 90*percent.
Note:
Due to rounding, items will not necessarily add to totals.
In the depression year 1932, the cost per $100
was $2.17, with $1,557,729,042 collected.
"Wi
Due to the promulgation of new regular individual
income tax rates, all tables on the back
of the “short
form“ 1040-A, setting forth net taxes due for varying amounts
of income, must be revised.
A new deduction which is authorized by the
revenue act is for extraordinary medical expenses not
compensated for by insurance or otherwise. Such expenses
become deductible to the extent that they exceed 5 per cent
of net income. Where a Joint return is filed or tha taxpayer
is the head of a family, the maximum deduction allowed is
$2500; in other cases the maximum is $1,250*
Total
tax collection costs of the government for
the current fisc&l
by the
year will be increased substantially
new tasks which the Treasury faces, but Treasury
officials
said the
cost per $100 of taxes collected is
expected to show a further decline*
For the fiscal year 1942, ending last June 30, with
$12,976,589,177 collected, the cost per $100 was 57 cents*
These 1942 figures exclude the yield of, and the cost of
collecting, the vehicle taxes collected through post offices.
Collections for the fiscal year 1941 were
$7,370,108,377 and the cost per $100 was
89 cents.
The new Revenue Act prevents use cf form 1040-A
by taxpayers reporting rents and royalties as part of their
income. Another new restriction is that both spouses of
a married couple making separate returns must use
type of form. Heretofore, one spouse could use
the same
1040 and
the other 1040-A, if desired.
In accordance with another departure in the new
law, all individual income tax return forms are being
revised to substitute a simple affirmation
as to correctness
for the oath previously required.
Treasury printing presses have
a giant assignment
as a result of the new legislation. Ninety million each of
forms 1040 and 1040-A, it has been calculated, will be
required
for the use of taxpayers submitting returns next
March 15. In addition, 45,000,000 separate instruction sheets
to accompany the
distributed.
1040-A forms will be printed and
-
6
-
The new rates and modified exemptions for the regular
individual income tax are effective as of last January 1, and
hence are applicable to incomes for the full year 1942.
The
new individual income tax schedules will increase the annual yield
»
from individual returns to about $8,000,000,000 and the new gross
individual Victory tax, after deducting post-war credits, will
yield about $1,955*300,000.
Use of the simplified form No. 1040-A for regular
individual income tax returns on incomes of $3,000 or
less
\
derived from specified sources — salary, wages, compensation
for personal services, dividends, interest, and annuities —
will be continued, and its popularity is expected to increase.
About 9,000,000 persons used this form in reporting
1941
incomes.
i
A nominal rate of 5 per cent for the new tax is
fixed in the Revenue A 0t. Taking of post-war credits
currently will be general, however, the Treasury expects,
and
will
reduce the effective rate to approximately
3 per cent for married persons and 3,75 per cent for single
persons.
The R err m îr— frrlt" ^ nrfo n ftt
gross\ individual lincome tax payments
from income in
c a lc u la tin g regular individual ¡income taxe^.J
\
I
/
1
*
Whereas individual ilncome takatlpn short years
V
1
I
/
i
I,
ago r<iached only one American cfitlzep:'' out of 20, it new
becom s the dire\ti concern of apprit two peipons out o:
every five, Treasvhy estlmate^lindicate thlt approximately
I\
this ratio
/
I
I
I
of taxpayers w^ll |e reached nkxt year through
the new tax on
of exemptions
gross Incomes
land the lowering
for the regular! individuali income le‘
The Treasury statisticians expèct 45,300,000
gross (individual ✓Income tax returns to be made in 1944,
Of thepe, it 1
ìstimated 3 ,Jq Òl 000 will be from persons
owing ho tax/but ¡claiming crep.it for souri ie collections,
I
/
*
V
Of the 1regaining (42,800,000, Jit is Axpect¡fed 7,000,00
1/
will bé /joint re urns
covering spousVs from whom th
tax wilt be collected at the! source, ancL therefore w!
(
I
X
\
represent
14t000i000
persons!
These
forecasts
place
the
i
»
i
r
r
* x __ * ______i_
..-----------
-actual numb»!
t v
A
onspayLng the new tax at 49,800Ì000.
Throughout 1943, however, individuals subject
to the new tax are urged by the Treasury to keep detailed
memoranda on which to base their 1944 returns. These
memoranda, officials said, should cover not only amounts
of income received and the periodic^ deductions made by
employers, but also all transactions involved in the Revenue
Act *s scheme of ”post-war credits” against the tax.
The act provides that 40 per cent of the tax
shall be returned to married persons and 25 per cent to single
persons
after the ^cessation of hostilities, within maximum
limits of #1,000 per year for husband and wife filing
a joint return, $500 for a single person or a married person
filing a separate return, and $100 on account of each
dependent.
These credits may be taken currently to the
extent of payment of premiums on life insurance in force
on Sept. 1, 1942; net repayment of debts outstanding
Sept. 1, 1942; and net purchases of specified United States
obligations. The current credits will be claimed for 1943
individual
when the first groslT}income tax returns are made out in 1944,
covering 1943 Income.
salary
When deductions from the wages or
of the taxpayer have exceeded the remaining net
amount of the new tax, the excess may be credited by the
taxpayer on other taxes, including regular income taxes, which
he owes the government .If not so credited, the excess will be
refunded by the Treasury.
3
One of the first big tasks of the Treasury is to
suppiy employers throughout the nation with full data concerning
the new tax
on gyp**» individual incomes irexcess of
$624 a year —
gross incomes in the case of wages, salaries,
interest and dividends, and net incomes in the case of rents
and money from business, professional and farm sources*
This tax
goes into effect January 1,1943, and
the Revenue Act requires employers to deduct the tax from wages
and Hilaries* The Internal Revenue Bureau soon will distribute,
through its 64 collection districts in the United States and
possessions, full instructions to employers on how the
Revenue Act directives are to be complied with.
Provisions requiring collection of the gross
income tax at the source, for incomes from wages and salaries,
represents the first application in this country of the
Individual
currect collection principle for*Income taxation*
Employers will give each employee a yearly statement covering
collections, a n d will transmit copies of the statements to the
collectors of internal revenue to be used as basic Treasury
Department records.
Taxpayers will not make returns for the individual
gross issrmmte
individual income tax until 1944, and there will
be no reference to this tax on the regular individual income
tax forms
incomes.
soon to be distributed for use in reporting 1942
2
Vihereas individual income taxation short years ago
reached only one American citizen out o,
S^20j) it now becomes
the direct concern of about two persons out of every five*
Treasury estimates indicate that approximately this ratio
of taxpayers will be reached next year through the
new tax
on gross incomes and the lowering of exemptions for the regular
individual income levy*
The Treasury statisticians expect 45,800 gross
individual income tax returns to be made in 1944. Of these,
it is estimated 3,000,000 will be from persons owlpg no tax
but claiming credit
for source collections. Of the remaining
42,800,000, it is expected 7,000,000 will be joint returns
covering spouses from whomlthe tax will be collected at
the source, and therefore will represent 14,000,000 persons.
These forecasts place the actual number of persons paying the
new gross individual Income tax at 49,800,000*
Spreading of the incidenc^pf the regular individual
income tax through lowered exemptions is expected by the
Treasury to result in upwards of 35,000,000 returns on 1942
income, with probably '27,200,000 reporting taxes due. These
record
estimates compare with the pigjMdet of
26,369,044 returns and
16,760,865 individual income tax payers on 1941 incomes*
----- — ^ S t a f f s
of all the tax collecting and tax accounting
agencies of the Treasury Department were at work today
preparing to put into effect as smoothly and expeditiously
as possible the record-breaking new Federal tax levies called
for in the new Revenue Act of 1942,
_
,
ipto la„
t signed
In fit-
lent Roosevelt.
The new taxes will increase to approximately
424,
according to Treasury forecasts,the annual yield
of existing revenue measures expanded to help finance the war.
The ^combined levies will ieSoft' the pocketbooks of more
t h a i ( 5 0 ^ ^ S 2 e § r e c i p i e n t s of wages, salaries and profits,
with the total of their contributions amounting to not quite
a third of the nation’s current war expenditures.
As the y^ct imposes on the American people their
greatest tex-paying burden in history, so it imposes on the
Treasury Department an unprecedented tax collecting responsi4/[
i
4A/—
pointed out.
Assistants of Commissioner Gu£
T. Helvering J of the
Bureau of Internal Revenue, in which the Federal tax collecting
procedures are centered, are at work on s cores of tasks having
to do with streamlining the collection machinery and
lightening, as far as possible, the impact of the new tax
load on American life.
TREASURY DEPARTMENT
Washington
FOR IMMEDIATE RELEASE,
Thursday, October 22, 19^-2.
Press Service
No. 33-77
Staffs of all the tax collecting and tax accounting agencies
of the Treasury Department were at work today preparing to put
into effect as smoothly and expeditiously as possible the recordbreaking new Federal tax levies called for in the new Revenue Act
of 19^2,
signed into law yesterday by President Roosevelt.
The new taxes will increase to approximately $2^,000,000,000,
according to Treasury forecasts, the annual yield of existing
revenue measures expanded to help finance the war.
The combined
levies will reach the pocketbooks of more than 5 0 ,0 0 0 ,0 0 0 recipi
ents of wages, salaries and profits, with the total of their con
tributions amounting to not quite a third of the n a t i o n ’s current
war expenditures.
As the Act imposes on the American people their greatest
tax-paying burden in history, so it imposes on the Treasury D e
partment an unprecedented tax collecting responsibility, it was
pointed out.
Assistants of Commissioner Guy T. Helvering of the Bureau of
Internal Revenue, in which the Federal tax collecting procedures
are centered, are at work on scores of tasks having to do with
streamlining the collection machinery and lightening, as far as
possible, the impact of the new tax load on American life.
Whereas individual income taxation short years ago reached
only one American citizen out of twenty, it now becomes the direct
concern of about two persons out of every five.
Treasury esti
mates indicate that approximately this ratio of taxpayers will be
reached next year through the new tax on gross incomes and the
lowering of exemptions for the regular individual income levy.
The Treasury statisticians expect k^,%00sQQ0 gross individual
Income tax returns to be made in 19^-.
Of these, it Is estimated
3,000,000 will be from persons owing no tax but claiming credit
for source collections.
Of the remaining ^-2,&00,000, it is ex
pected 7,000,000 will be Joint returns covering spouses from whom
2
the tax will be collected at the source, and therefore will repre
sent 14-, 000,000 persons.
These forecasts place the actual number
of persons paying the new gross Individual income tax at
¿1-9,500,000.
Spreading of the incidence of the regular individual income
tax through lowered exemptions is expected by the Treasury to
result in upwards of “
$5,000,000 returns on 19 ^ 2 income, with
probably 27,200,000 reporting taxes due.
These estimates com
pare with the record of 2 6 ,3 o9 ,OkM- returns and 16, JoQ,
indi
vidual income taxpayers on
incomes.
One of the first big tasks of the Treasury is to supply
employers throughout the nation with full data concerning the new
tax on Individual incomes in excess of $62^ a year — - gross in
comes in the case of wages, salaries, interest and dividends, and
net incomes in the case of rents and money from business, p r o
fessional and farm sources.
This tax goes into effect January 1, 19^3» an^ the Revenue
Act requires employers to deduct the tax from wages and salaries.
The Internal Revenue Bureau soon will distribute, through its 6^
collection districts In the United States and possessions, full
Instructions to employers on h o w the Revenue Act directives are
to be complied with.
Provisions requiring collection of the gross Income tax at
the source, for Incomes from wages and salaries, represents the
first application in this country of the current collection
principle for individual income taxation.
Employers will give
each employee a yearly statement covering collections, and will
transmit copies of the statements to the collectors of internal
revenue to be used as basic Treasury Department records.
Taxpayers will not make returns for the Individual gross
individual income tax until
and there will be no reference
to this tax on the regular individual Income tax forms soon to
be distributed for use In reporting 19^2 Incomes.
Throughout 1 9 ^ 3 > however, Individuals subject to the new tax
are urged by the Treasury to keep detailed memoranda on which to
base their 1 9 ^ returns.
These memoranda, officials said, should
cover not only amounts of Income received and the periodic
de
ductions made by employers, but also all transactions involved in
the Revenue A c t ’s scheme of “post-war cred i t s “ against the tax.
The act provides that ¿K) percent of the tax shall be returned
to married persons and 25 percent to single persons after the
- 3 cessation of hostilities, within maximum limits of $1,000 per
year for husband and wife filing a joint return, $500 for a
single person or a married person filing a separate return, and
$100 on account of each dependent.
These credits may be taken currently to the extent of pay
ment of premiums on life insurance in force on September 1, 19^2;
net repayment of debts outstanding September 1, 1§Î2; and net
purchases of specified United States obligations. The current
credits will be claimed for 19^3 when the first gross individual
income tax returns are made out in 19*J4, covering 19^3 income.
When deductions from the wages or salary of the taxpayer have
exceeded the remaining net amount of the new tax, the excess may
be credited by the taxpayer on other taxes, including regular
Income taxes, which he owes the Government. If not so credited,
the excess will be refunded by the Treasury.
A nominal rate of 5 percent for the
Revenue Act. Taking of post-war credits
eral, however, the Treasury expects, and
tive rate to approximately 3 percent for
3.75 percent for single persons.
new tax is fixed in the
currently will be gen
will reduce the effec
married persons and
The new rates and modified exemptions for the regular indi
vidual income tax are effective as of* last January 1, and hence
are applicable to Incomes for the full year 19*4-2. The new indi
vidual income tax schedules will increase the annual yield from
individual returns to about $85,000,000,000 and. the new gross
Individual Victory tax, after deducting post-war credits, will
yield about $1 ,955,300,000.
Use of the simplified form No. 10*4-0-A for regular individual
income tax returns on incomes of $ 3,000 or less derived from
specified sources — salary, wages, compensation for personal
services, dividends, Interest, and annuities — will be continued,
and its popularity is expected to increase. About 9j 0°0,000
persons used this form in reporting 19*4-1 Incomes.
The new Revenue Act prevents use of form 10*4-0-A by taxpayers
reporting rents and royalties as part of their income. Another
new restriction is that both spouses of a married couple making
separate returns must use the same type of form. Heretofore, one
spouse could use 10*4-0 and the other 10*+0-A, if desired.
In accordance with another departure in the new law, all
individual Income tax return forms are being revised to substi
tute a simple affirmation as to correctness for the oath pre
viously required.
* k -
Treasury printing presses have a giant assignment as a result
of the new legislation. Ninety million each of forms l O k O and
10^0-A, it has been calculated, will be required for the use of
taxpayers submitting returns next March 15* In addition,
000,000 separate Instruction sheets to accompany the 10^0-A
forms will be printed and distributed.
Due to the promulgation of new regular individual income tax
rates, all tables on the back of the Hshort form” 10^0-A, setting
forth net taxes due for varying amounts of Income, must be revised.
A new deduction which is authorized by the Revenue Aot is for
extraordinary medical expenses not compensated for by insurance or
otherwise. Such expenses become deductible to the extent that they
exceed 5 percent of net income. Inhere a Joint return is filed or
the taxpayer is the head of a family, the maximum deduction
allowed is $2,500; in other cases the maximum is $1,250.
Total tax collection costs of the Jcvernment for the current
fiscal year will be Increased substantially by the new tasks which
the Treasury faces, but Treasury officials said the cost per $100
of taxes collected Is expected to show a further decline.
For the fiscal year 19^2, ending last June 30, with
$12,976,5^9,177 collected, the cost per $100 was 57 cents. These
19^2 figures exclude the yield of, and the cost of collecting, the
vehicle taxes collected through post offices.
Collections for the fiscal year 19^1 were
the cost uer $100 was 2>9 cents.
$7»37°»102,377
In the depression year 193^> the cost per $100 was $2,17#
with $1 ,557,729,0^2 collected.
-oOc-
“Other controls such as those on credit havebeen
placed in effect.
“But they are not enough. Measures are required
further to cut by many billion» the amount of funds entering
into consumer demand.
"Inflation often looks easy and taxes look hard
But at the end, inflation is the hardest way and
easiest.”
-o-
taxes the
"It may be possible to administer compulsory saving
or expenditure rationing, or extensive rationing of goods,
without serious evasions and creation of black markets. Taxes
are a surer way since when purchasing power is withdrawn at
its source the pressure to evade disappears.
"Taxes have a further advantage in the post-war
period. If vast sums are borrowed during the war from consumers,
or if funds are immobilized in the hands of consumers, there
may be a dangerous surge of purchasing power immediately after
the war.
"A tax measure that combines pmetSa withdrawal
of
purchasing power with the immobilization of additional
purchasing power is the spendings tax.... The
taxpayer can
spend if he is willing to pay the price, but he is strongly
induced to postpone his spending until such time as goods
once more become plentiful.
"Heavy reliance on direct taxes related to income
for reaching small taxpayers requires a reappraisal of our
collection methods. It becomes imperative to collect as much as
possible of our taxes at the source.
inflation
"Important steps have been "taken to meet the^problem .
K
A large revenue measure has just been passed. The power to
stabilize prices and wages has been conferred upon the President
and is being exercised. Some commodities are already being
rationed and others will be rationed.
%
\\
The flow of consumer goods and services, now running at the
0-0“® r#-*>
rate of about $80
a year, seems bound to fall in 1943
ejd'*UL«iL
to a level, at present prices, of
as
i«
t*H>,
$70 bill ion j
- This leaves the prospect in 1943 of
sfeofiillion of income in excess of goods and services at
present prices. If that
billion is spent, it will mean
explosive price rises; to prevent such
ij
price rises, legal and
eft**** o + V ft H » *
Illegal, the $ 9 0 b illion1 must not be spent. The problem
/
it
iHb*,
a~ro
is accordingly to keep the $yu b441iqrr,-from being spent.
“To supplement and support voluntary saving, measures
far beyond those already taken will be necessary to withdraw
and immobilize purchasing power.
“Compulsory saving enforced by punishing people who
save Jess than they are directed to
would be a method of
Immobilizing purchasing power, though perhaps a harsh one.
Expenditure rationing or limitation is in effect another approach
to compulsory saving. Under expenditure rationing, the total
amount which an individual could spent would be limited.
“The appropriate solution would appear to be a
reduction in consumer purchasing power through taxation. This (is
reinforced by the fact that financing through borrowing postpones
the final distribution of the financial burden among the various
elements of the population.
0
11Income payments to individuals are currently running
¿rf-y tHX), < M * 0
at the rate of about $115,
uJfcllJrai
may rise to a level of about $125
wage
a year, and at present prices
b i l i l ' U T T " in
1943 if price and
stabilization is successful* Federal,state and local taxes
paid directly b y Individuals wi l l take not more than $15 b i l l i o n
j
tHI-®
of this income,leaving individuals with $110 hiillirm to spend
or to save as they please.
j
« n é n r e ei&b o di e d
M Î T » * ”■ S
Ste.
B »
» «
»
"
fiIl4+U**f
“
with Mr- Blough.
3
yi
—
;
22.
ìt »
***>
/ /
;ion measures “far beyond those already
;o
prevent explosive price rises which
economy for 1943,.
the annual
e of the National Tax Association was
ti by Roy Blough, director of tax
-r
-r
îry Department.
i__w * ise threat stems, he said, from the
wêr. in 1943 will
prospect that consumer purchasing powL_^
vL^ . à U n Jc H ^ «-*-« tr+o
S'
the
exceed b y
m
sum total of
*
^ 'i^
. jT -T ^ ^
...»*».111
consumer goods and services which will be avMlaTbleyr steps
to withdraw and immobilize
this excess purchasing power
are required, Mr. Blough explained.
Speaking on the subject, “Tax Policy and the
Inflation
Problem: The Treasury View” * Mr. Blough said
in part:
“The avoidance of inflation
becomes a vital-
aim of wartime fiscal policy.
“The threat of Inflation is not a bogey w' ich has
been conjured up for the purpose
of scaring people. Prices
have risen substantially in the past two years....The
situation foi the
future is more threatening.
A
a
Anti-inflation measures “far beyond those already
«m h MÜ WUË8BB/tZ&Ts5
taken” are necessary to
prevent explosive price rises which
threaten this nation1s economy for 1943,.
»nat 1
"
the annual
conference of the National Tax Association was
told today at Cincinnati by Hoy Blough, director of tax
research for the Treasury Department.
The price rise threat stems, he said, from the
prospect that consumer purchasing power in 1943 will
vc
'r* °
^
exceed by-TffhHrftl 11 rtn
the
consumer goods and services which will be availaïïî^T Steps"
to withdraw and immobilize
this excess purchasing power
are required, Hr. Blough explained.
Speaking on the subject, “Tax Policy and the
Inflation
Problem: The Treasury View“ * Mr. Blough said
in part:
“T
@FedFRASER