I hereby give My Sanction to the Law of Revisions in Temporary Management Law for Taxation, for which the concurrence of the Imperial Diet has been obtained, and order the same to be promulgated.
Signed:HIROHITO, Seal of the Emperor
This first day of the ninth month of the twentyfirst year of Showa (September 1, 1946)
Countersigned: Prime Minister YOSHIDA Shigeru
Minister of Finance ISHIBASHI Tanzan
Law for the Amendment of the Temporary Taxation Measures
Article 1. Temporarily, this law shall provide reduction or exemption of income tax, corporation tax, special corporation tax, the business tax and registration tax, or shall furnish special rules with respect to the computation of taxation-standards or the tax collection.
Article 2. The under-mentioned items of class "A" income from dividends and interests shall, as prescribed by Ordinance, be exempted from the classified income tax.
1. The interests on public bonds and corporation debentures as registered by, banks (excluding the Bank of Japan) or other banking facilities as prescribed by Ordinance, in accordance with the Law No.34, 1906 or the Corporation Debentures Registration Law.
2. The interests on public bonds and corporation debentures as deposited by the saving banks or other banks which engage in savings bank business, in accordance with para.1, Art.9 of the Savings Bank Law or Para.1, Art.2 of the Law No.43, 1943.
3. The interests on such deposits of the banking facilities in the banking facilities as prescribed by Ordinance.
Article 3. In the case where an individual felled or transferred trees in order to meet the necessity of augmentation of lumber or fuel, in accordance with law, Ordinance, orders based on law or Ordinance, or under guidance or intermediation of the administrative authorities, the classified income tax shall be imposed upon the income from forests as obtained by the lumber or transfer of the trees, after deducting 5/10 of the amount computed by such manner as prescribed by Ordinance.
Article 4. In the case where an individual has appropriated for the payment of the succession tax, real property or growing trees which belong to inherited property, in accordance with the provision of Art.17-11 of the Succession Tax Law, the classified income tax shall, as prescribed by Ordinance, be imposed upon the amount of such incomes from transfer or of such incomes from forest as acquired by the appropriation, after deducting therefrom the amount as prescribed by Ordinance, out of the amount of the Succession Tax as imposed upon the said real property or growing trees.
Article 5. If the amount of income or of net profits obtained by an individual from business during the current year goes down more than 50 per cent as against the determined amount of income or of net profits from business for the year, income tax and business tax as imposed upon the business income for the year shall be reduced, as prescribed by the Ordinance, as follows:
In the case where the rate of decrease is below 70 per cent, 3/10 of the amount of the tax.
In the case where the rate of decrease exceeds 70 per cent, 6/10 of the amount of the tax.
The provisions of the preceding paragraph shall not apply in the case where the income of an individual for business is over 50,000 yen during the current business year.
The provision of the preceding two paragraphs shall apply mutatis mutandis in respect of the case where the amount of income of an individual, corresponding to class B business income, as obtained during the current business year, goes down more than 50 per cent as against the determined amount of the income for the year.
Article 6. A person who wants deduction of the income tax of the business tax in accordance with the provision of the preceding Article shall, as prescribed by Ordinance, shall apply the matter to the Government.
If an application as prescribed in the preceding paragraph is filed, the Government may postpone the collection of the tax until the procedure of the reduction is fixed.
Article 7. The Government subsidies or other similar money as given to a corporation, as prescribed by Ordinance shall, as prescribed by Ordinance, not be counted in the profits, with respect to the computation of income under the Corporation Tax Law and of net profits under the Business Tax Law.
Article 8. The amount of suns to be transferred into the funds as established by such corporations as designated by Ordinance, for the purpose of priceoperation or installation-repair, in conformity with Government Policy, shall, as prescribed by Ordinance, be counted in the loss, with respect to the computation of income under the Corporation Tax Law and net profits under the Business Tax Law.
Article 9. In the case where a corporation issued shares at the price exceeding face value, the amount corresponding to the five-tenths of the excess amount, shall, as prescribed by Ordinance, not be counted as profits, with respect to the computation of profits under the Corporation Tax Law and of net profits under the Business Tax Law.
Article 10. The amount of contribution as made by a corporation or a special corporation which exceeds the amount as computed in conformity with the provisions of Ordinance shall not be counted in the loss, with respect to the computation of profits under the Corporation Tax Law and net profits under the Business Tax Law or of surplus under the Special Corporation Tax Law,provided that with regard to such a kind of contribution as prescribed by Ordinance, the part of the excess amount may be counted as a loss.
Article 11. The fine as paid by a corporation (including such fine as paid pursuant to "notified disposition" ) shall not be counted as a loss, with respect to the computation of income under the Corporation Tax Law and net profits under the Business Tax Law.
Article 12. In the case where an amalgamation of juridical persons takes place and the shares (including contributed fund,) belonging to a corporation which ceased to exist due to the amalgamation are possessed, before the amalgamation, by the corporation which continues to exist after the amalgamation, such money as used for buying the shares shall, as prescribed by Ordinance, be regarded as one obtained through the amalgamation by the shareholders (including a clerk) or the corporation which ceased to exist due to the amalgamation, from the corporation which continues to exist due to the amalgamation, from the corporation which continues to exist after the amalgamation or from the corporation which has been newly created by the amalgamation and beliable to the application of the Corporation Tax Law and the Business Tax Law.
Article 13. The item limit for the filing of a return as prescribed under Art.18 of the Corporation Tax Law or Art.15 of the Business Tax Law which is to be submitted by a corporation which may be designated by Ordinance, shall be within sixty days after the settlement of account for each business year.
Article 14. A corporation as referred to under the preceding article shall be liable to pay to the Government, as prescribed by Ordinance, corporation tax and business tax of each business year, simultaneously with the filing of a return as prescribed under the provisions of the same article.
Article 15. In the case when a corporation as referred to under Art.13 fails to pay the corporation tax or business tax in accordance with the provisions of the preceding article, or the amount paid up proved short of the amount of the tax due, the whole amount of the tax or the deficit, plus, as prescribed by Ordinance, the amount as calculated in accordance with the provisions of Ordinance, shall be collected.
Article 16. The provisions of Arts.7-9 of the Taxpayment reserve Fund Law shall not apply to a corporation as prescribed under Art.13.
Article 17. In the case where the exchange of the ownership of arable land (including the land as utilized subordinately thereto) has been performed, the registration tax on the registration of the ownership, due to the exchange or for the exchange, shall be exempted as prescribed by ordinance.
The provisions of the preceding paragraph shall apply mutatis mutandis in respect to the exchange of perpetual lease or the exchange between the ownership of arable land as referred to under the preceding paragraph and perpetual lease.
Article 18. In the case where the following items are conducted by a law, an ordinance, an order based on law or ordinance, or under guidance or intermediation of the administrative authorities, the registratisn tax shall, as prescribed by Ordinance, be levied as shown below, notwithstanding the Registration Tax Law, unless otherwise prescribed by law or Ordinance;provided, however, that if the amount of the registration tax as computed pursuant to the Registration tax as computed pursuant to the Registration Tax Law proves less than the amount shown below, the former shall be levied.
1) Establishment of corporations
The total sum of both 6 of the paid amount as contributed in money and 1.5/1000 of the paid amount as contributed in other property than money.
2) Increase of capital of corporations
The total sum of both 6/1000 of the paid amount as contributed in money and 1.5/1000 of the paid amount as contributed in property other than money.
3) The subsequent payment to shares
The total sum of both 6/1000 of the paid amount of each time in money and 1.5/1000 of the paid amount as contributed in property other than money.
4) Acquisition of rights concerning immovables or ships in the case of establishment of corporations, increase of capital, subsequent payment to shares or transfer of equipment or business.
4/1000 of the value of the immovables or ships.
Supplementary provisions:
This Law shall come into force as from the day of its promulgation.
With regard to the income tax on income from class "A" and "B" business, forests, transfer of properties and on overall income of an individual, and the business tax of an individual, this Law shall apply in respect of the same of 1947&after.
With regard to the corporation tax on normal income and excess income of a corporation and the business tax thereto, the present law shall apply in respect of the business year of a corporation ending on and after April 1, 1946, and with regard to the corporation tax on, the income at liquidation and the business tax on the profits at liquidation, this Law shall apply in respect of the same due to the amalgamation or dissolution as accrued on and after the said date.
With regard to the special corporation tax on surplus profits, this Law shall apply in respect of the business year of a corporation ending on and after April 1, 1946.
With regard to (1) the classified income tax taxable on the class "B" income from dividends and interests in respect of the taxable year before 1945, (2) the income tax taxable on class "A" and "B" business income, on class "B" earned income, on income from forests, and on allover income of an individual, (3) the business tax on individuals and the extraordinary profits tax, in respect of the taxable year before 1946, (4) the mining tax in respect of the taxable year before 1946, (5) the corporation tax taxable on the income and capital in respect of each business year ending before March 31, 1946, the business tax and the extraordinary profits tax taxable on the net profits of a corporation in each business year, (6) the corporation tax taxable on the income from liquidation and the business tax taxable on the net profits from liquidation as accrued from the dissolution or amalgamation before March 31, 1946, (7) the special corporation tax taxable on the surplus of a special corporation in respect of a business year ending before the same date and the special corporation tax taxable on the surplus from liquidation as accrued from the dissolution or amalgamation before the same date, and (8) the classified income tax taxable on the class "A" income from dividends and interests to be paid to the taxpapet before August 31, 1946 (or to have been paid with respect to the interests of public bonds and debentures)(9) the Registration Tax, reduction, special treatments of exemption, the computation of the taxation standards or the collection of the taxes, or taxable capacity shall follow the former rules.