Page:United States Statutes at Large Volume 55 Part 1.djvu/720

 55 STAT.] 77TH CONG. , 1ST SESS. -CH. 412-SEPT. 20, 1941 SEC. 107. WITHHOLDING OF TAX AT SOURCE. (a) Sections 143 (a) and (b) and 144 of the Internal Revenue Code are amended by striking out "15 per centum" wherever occurring therein and inserting in lieu thereof "271/2 per centum". (b) Section 143 (h) of the Internal Revenue Code is repealed. (c) Subsections (a) and (b) of this section shall apply only with respect to the period beginning with the tenth day after the date of the enactment of this Act. SEC. 108. TREATY OBLIGATIONS. No amendment made by this title shall apply in any case where its application would be contrary to any treaty obligation of the United States. SEC. 109. REDUCTION IN PURSUANCE OF TREATIES OF RATES OF TAX AND WITHHOLDING ON NONRESIDENT ALIEN INDIVIDUALS RESIDENT IN, AND CORPORATIONS ORGANIZED UNDER LAWS OF, WESTERN HEMISPHERE COUNTRIES. (a) Section 143 (a) (1) (relating to withholding of tax on tax-free covenant bonds); section 143 (b) (relating to withholding of tax on dividends, rents, etc.); section 144 (relating to payment of corpora- tion income tax at source); section 211 (a) (1) (relating to tax on nonresident alien individuals); and section 231 (a) (1) (relating to tax on nonresident foreign corporations) of the Internal Revenue Code are amended by striking out "a contiguous country" and insert- ing in lieu thereof "any country in North, Central, or South America, or in the West Indies, or of Newfoundland". (b) Section 211 (a) (3) of the Internal Revenue Code is amended to read as follows: "(3) RESIDENTS OF CERTAIN COUNTRIEs. -The provisions of para- graph (2) shall not apply to a resident of any country in North, Central, or South America, or in the West Indies, or of New- foundland, so long as there is in effect with such country a treaty which provides otherwise." (c) Section 211 (c) (4) of the Internal Revenue Code is amended to read as follows: "(4) This subsection shall not apply to a resident of any country in North, Central, or South America, or in the West Indies, or of Newfoundland, so long as there is in effect with such country a treaty which provides otherwise." SEC. 110. DEFENSE TAX RATES ON PERSONAL HOLDING COM- PANIES AND TRANSFERS TO AVOID INCOME TAX INCOR- PORATED IN RATE SCHEDULES. (a) PERSONAL HoLDING COMPANIE. - -Section 500 of the Internal Revenue Code (relating to tax on personal holding companies) is amended as follows: (1) By striking out the heading "(a) GENERAL RULE.- "; 2) By amending the rate schedule to read as follows: "(1) 711/2 per centum of the amount thereof not in excess of $2,000; plus "(2) 821/2 per centum of the amount thereof in excess of $2,000."; and (3) By repealing subsection (b) (relating to defense tax for five years). 53 Stat. 60, 62; 54 Stat. 519. 26 U. S. C. §§143, 144. 54 Stat. 520 . 26U.S. C. § 143 (h). 53 Stat. 60, 61. 26U.S.C.§143 (a) (1), (b). 53 Stat. 62. 26U.S.C. 144. 53 Stat. 75 . 26 U. S.C. 211 (a) (1). 53 Stat. 78. 26U.S.C.. 231 (a) (1). 53 Stat. 75. 26U.S.C.§211 (a) (3). 53 Stat. 76 . 26(1.S.O.§211 (c) (4). 53 Stat. 104; 54 Stat. 521. 26 U. S.C. §500. 54 Stat. 521. 26 U.S. C. 560 (b).

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