Page:United States Statutes at Large Volume 56 Part 1.djvu/967

 77TH CONG. , 2D SESS.-CH. 619 -OCT. 21, 1942 "(2) An amount equal to 40 per centum of the amount by which the smallest amount of indebtedness during the period beginning September 1, 1942, and ending with the close of the preceding taxable year exceeds the amount of indebtedness as of the close of the taxable year. "(3) In case such taxable year begins in 1942 prior to Septem- ber 2, 1942, and ends after September 1, 1942, an amount equal to 40 per centum of the amount by which the amount of indebted- ness as of September 1, 1942, exceeds the amount of indebtedness as of the close of the taxable year. "(4) In case such taxable year begins in 1941 or ends before September 1, 1942, zero. No interest shall be allowed or paid by the United States on account of any overpayment of tax attributable to any credit allowed under this section. "(c) REDUCTION OF CREDIT AND OF BONDS OUTSTANDING UNDER SECTION 780. - If a credit is allowed for debt repayment in a taxable year pursuant to this section, the amount of such credit or refund shall be deducted from the credit under section 780 (a) and the amount of bonds issued under section 780 shall, to the extent necessary, be corre- spondingly adjusted. "(d) DEFINITION OF INDEBTEDNESS.-For the purposes of this section the term 'indebtedness' means any indebtedness of the taxpayer or for which the taxpayer is liable evidenced by a bond, note, debenture, bill of exchange, certificate, or other evidence of indebtedness, mortgage, or deed of trust." TITLE III-CAPITAL STOCK AND DECLARED VALUE EXCESS PROFITS TAXES SEC. 301. CAPITAL STOCK TAX. (a) TECHNICAL AMENDMENT.-Section 1200 (a) and (b) (relating to rate of capital stock tax) are amended by striking out the word "adjusted" wherever occurring therein. (b) ANNUAL DECLARATION OF VALUE.- Section 1202 (relating to declaration of value) is amended to read as follows: "SEC. 1202. DECLARED VALUE. "(a) DECLARATION OF VA.LUE. -The declared value shall be the value as declared by the corporation in its return for the year (which declaration of value cannot be amended). The value declared by the corporation in its return shall be as of the close of its last income-tax taxable year ending with or prior to the close of the capital stock tax taxable year (or as of the date of organization in the case of a cor- poration having no income-tax taxable year ending with or prior to the close of such declaration year). "(b) CREDIT FOR CHINA TRADE ACT CORPORATIONS. -For the pur- pose of the tax imposed by section 1200 there shall be allowed in the case of a corporation organized under the China Trade Act, 1922, 42 Stat. 849 (U. S. C ., 1940 ed., title 15, ch. 4), as a credit against the declared value of its capital stock, an amount equal to the propor- tion of such declared value which the par value of the shares of stock of the corporation, owned on the last day of the taxable year by (1) persons resident in China, the United States, or possessions of the United States, and (2) individual citizens of the United States or China wherever resident, bears to the par value of the whole num- ber of shares of stock of the corporation outstanding on such date. For the purposes of this subsection shares of stock of a corporation 939 Ante, p. 936. 53 Stat. 169. 26U. .C., Supp.I, § 1200 (a), (b). 53 Stat. 169. 26 U. . C.. 1202; Supp. I, i 1202. 53 Stat. 169. 26U.S.C.,Spp. I, 1200. 56 STAT.]

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