CONGRESS. (THE TARIFF BILL.) 



215 



hundred per centum as a penalty to the amount of 

 tax ascertained to be due, the tax and the additions 

 thereto as a penalty to be assessed and collected in 

 the manner provid'ed for in other cases of willful 

 neglect or refusal to render a list or return, or of render- 

 ing a false or fraudulent return : Provided, That any 

 person or corporation in his, her, or its own behalf, or 

 as fiduciary, shall be permitted to declare, under oath 

 or affirmation, the form and manner of which shall be 

 prescribed by the Commissioner of Internal Revenue, 

 with the approval of the Secretary of the Treasury, 

 that lie, she, or his, or her, or its ward, or beneficiary, 

 was not possessed of an income of four thousand dol- 

 lars liable to be assessed according to the provisions 

 of this act ; or may declare that lie, she, or it, or his, 

 her, or its ward or beneficiary has been assessed and 

 has paid an income tax elsewhere in the same year, 

 under authority of the United States, upon all his, 

 her, or its income, gains, or profits, and upon all the 

 income, gains, or profits for which he, she, or it is 

 liable as such fiduciary, as prescribed by law; and if 

 the collector or deputy collector shall be satisfied of 

 the truth of the declaration, such person or corpora- 

 tion shall thereupon be exempt from income tax in 

 the said district for that year ; or if the list or return 

 of any person or corporation, company or association 

 shall have been increased by the collector or deputy 

 collector, such person or corporation, company or as- 

 sociation, may be permitted to prove the amount of 

 income liable* to be assessed ; but such proof shall not 

 be considered as conclusive of the facts, and no de- 

 ductions claimed in such cases shall be made or al- 

 lowed until approved by the collector or deputy col- 

 lector. Any person or company, corporation or asso- 

 ciation feeling aggrieved by the decision of the deputy 

 collector in such cases may appeal to the collector of 

 the district, and his decision thereon, unless reversed 

 by the Commissioner of Internal Revenue, shall be 

 final. If dissatisfied with the decision of the collector, 

 such person or corporation, company or association 

 may submit the case, with all the papers, to the Com- 

 missioner of Internal Revenue for his decision, and 

 may furnish the testimony of witnesses to prove any 

 relevant facts, having served notice to that effect upon 

 the Commissioner of Internal Revenue, as herein pre- 

 scribed. 



Such notice shall state the time and place at which, 

 and the officers before whom, the testimony will be 

 taken ; the name, age, residence, and business of the 

 proposed witness, with the questions to be propounded 

 to the witness, or a brief statement of the substance 

 of the testimony he is expected to give : Provided, 

 That the Government may at the same time and 

 place take testimony upon like notice to rebut the 

 testimony of the witnesses examined by the person 

 taxed. 



The notice shall be delivered or mailed to the Com- 

 missioner of Internal Revenue a sufficient number of 

 days previous to the day fixed for taking the testi- 

 mony, to allow him, after its receipt, at least five days, 

 exclusive of the period required tor mail communica- 

 tion with the place at which the testimony is to be 

 taken, in which to give, should he so desire, instruc- 

 tions as to the cross-examination of the proposed wit- 

 ness. 



Whenever practicable, the affidavit or deposition 

 shall be taken before a collector or deputy collector 

 of the internal revenue, in which case reasonable 

 notice shall be given to the collector or deputy col- 

 lector of the time fixed for taking the deposition or 

 affidavit. 



rn>nided, further. That no penalty shall be as- 

 sessed upon any person or corporation, company or 

 association for such neglect or refusal or for making 

 or rendering a willfully false or fraudulent return, 

 except after reasonable notice of the time and place 

 of hearing, to be prescribed by the Commissioner of 

 Internal Revenue so as to give* the person charged an 

 opportunity to be heard. 



SEC. 30. The taxes on incomes herein imposed shall 

 be due and payable on or before the 1st day of July 



in each year; and to any sum or sums annually due 

 and unpaid after the 1st day of July as aforesaid, and 

 for ten days after notice and demand thereof by the 

 collector, there shall be levied, in addition thereto, 

 the sum of five per centum on the amount of taxes- 

 unpaid, and interest at the rate of one per centum per 

 month upon said tax from the time the same becomes 

 due, as a penalty, except from the estates of deceased, 

 insane, or insolvent persons. 



SEC. 31. Any nonresident may receive the benefit 

 of the exemptions hereinbefore provided for by filing 

 with the deputy collector of any district a true list of 

 all his property and sources of income in the United 

 States, and complying with the provisions of section 

 56 of this act as if a resident. In computing income 

 he shall include all income from every source, but un- 

 less he be a citizen of the United Sta'tes lie shall only 

 pay on that part of the income which is derived from 

 any source in the United States. In case such non- 

 resident fails to file such statement, the collector of 

 each district shall collect the tax on the income de- 

 rived from property situated in his district, subject 

 to income tax, making no allowance for exemptions, 

 and all property belonging to such nonresident shall 

 be liable to distraint, for tax : Provided, That non- 

 resident corporations shall be subject to the same 

 laws as to tax as resident corporations, and the col- 

 lectidh of the tax shall be matte in the same manner 

 as provided for collections of taxes against nonresi- 

 dent persons. 



SKC. 32. That there shall be assessed, levied, and 

 collected, except as herein otherwise provided, a tax 

 of two per centum annually on the net profits or in- 

 come above actual operating and business expenses, 

 including expenses for materials purchased for manu- 

 facture or bought for resale, losses, and interest on 

 bonded and other indebtedness of all banks, banking 

 institutions, trust companies, savings institutions, fire, 

 marine, life, and other insurance companies, railroad, 

 canal, turnpike, canal navigation, slackwater, tele- 

 phone, telegraph, express, electric-light, gas, water, 

 street railway companies, and all other corporations, 

 companies, or associations doing business for profit in 

 the United States, no matter how created and organ- 

 ized, but not including partnerships. That said tax 

 shall be paid on or before the 1st day of July in each 

 year ; and if the president or other chief officer, or any 

 corporation, company, or association, or, in the case of 

 any foreign corporation, company, or association, the 

 resident manager or agent shall neglect or refuse to 

 file with the collector of the internal-revenue district 

 in which said corporation, company, or association 

 shall be located or be engaged in business, a state- 

 ment verified by his oath or affirmation, in such form 

 as shall be prescribed by the Commissioner of Inter- 

 nal Revenue, with the approval of the Secretary of 

 the Treasury, showing the amount of net profits or 

 income received by said corporation, company, or as- 

 sociation during the whole calendar year last preced- 

 ing the date of filing said statement as hereinafter 

 required, the corporation, company, or association 

 making default shall forfeit as a penalty the sum of 

 one thousand dollars and two per centum on the 

 amount of taxes due for each month until the same 

 is paid, the payment of said penalty to be enforced as 

 provided in other cases of neglect and refusal to make 

 return of taxes under the internal revenue laws. 



The net profits or income of all corporations, com- 

 panies, or associations shall include the amounts paid 

 to shareholders, or carried to the account of any fund, 

 or used for construction, enlargement of plant, or any 

 other expenditure or investment paid from the net 

 annual profits made or acquired by said corporations, 

 companies, or associations. 



That nothing herein contained shall apply to States, 

 counties, or municipalities ; nor to corporations, com- 

 panies, or associations organized and conducted solely 

 for charitable, religious, or educational purposes, in- 

 cluding fraternal beneficiary societies, orders, or asso- 

 ciations operating upon the lodge system and provid- 

 ing for the payment of life, sick, accident, and other 



