Chapter I General Provisions

Article 1. War indemnity claims within the meaning of the present Law shall be such claims as stated hereunder which occurred against the Government, and, to the extent of the Government guarantee, occured against specified instrumentalities (hereinafter meaning juridical persons and other institutions as may be prescribed by Ordinance, which have been collaborating with national policies), provided, that claims arising out of normal administrative or business operation of the Government or specified instrumentalities shall be excluded therefrom: 1. Claims due and unpaid (payment shall hereinafter include payment in substitute, offset and renovation) on or prior to August 15, 1945 (excluding the amount already paid in the case of partial payment) and claims paid on or prior to said date, in accordance with the formula of renovation as prescribed under Article 5 of the Enterprises Reorganization Financial Measures Law (including other clearance formula of similar nature as may be prescribed by Ordinance)(excluding thereform the amount refunded, realized, released or extinguished due to confusion, on or prior to said date, from or in the Government special debt certificate, debtor's special debt certificate, blocked account, specia monetary trusteeship and other forms of credit as may be prescribed by Ordinance, which has been set or given as an instrument of payment). 2. Claims due after August 15, 1945, arising out of losses or damages occurred on or prior to said date (including losses or damages occurred after said date concerning a contract existing on said date) or arising out of the supply or construction made on or prior to said date (including the supply made after said date due to a contract existing on said date). The Government as referred to in the preceding paragraph shall mean the nation, prefectures, cities, towns, villages and other public bodies as may be prescribed by Ordinance. The amount withdrawn, on or prior to August 15, 1945, from such deposit as is to be prescribed by Ordinance, which has been acquired from a bank in exchange for the transfer to the bank of a Government special debt certificate, shall be deemed, for purposes of the application of Item 1 of Paragraph 1, the amount which has been refunded on or prior to said date from a Government special debt certificate. The scope of claims arising out of normal administrative or business operation as referred to in priviso of Paragraph 1 shall be defined by Ordinance.

Article 2. A person who holds a war indemnity claim (hereinafter meaning only a claim for the supply of money with the only exception of the case as referred to in Article 65) on the enforcement of the present Law or a person who has been paid its war indemnity claim before the enforcement of the present Law shall be liable to pay war indemnity special tax in accordance with the present Law.

Article 3. No war indemnity special tax shall be imposed on prefectures, cities, towns, villages and other public bodies as may be prescribed by Ordinance.

Article 4. No war indemnity special tax shall be due on the following claims: 1. Claims or national bonds, local public bonds and debentures issued by specified instrumentalities. 2. Claims for compensation or insurance of death or accident. 3. Claims arising out of social relief program. 4. Other claims as may be prescribed by Ordinance.

Article 5. In case an inheritance has occurred before the enforcement of the present Law to an individual who had been paid his war indemnity claim, the payment of war indemnity claim as given to the predecessor shall be deemed, for purposes of the present Law, as given to the inheritor or its successor.

Article 6. In case a corporation which had been given the payment of war indemnity claim has ceased to exist due to amalgamation before the enforcement of the present Law, the payment as given to the deceased corporation shall be deemed for purposes of application of the present Law as given to the corporation (or its successor) which continues to exist after, or which has been newly established by, the amalgamation. In case a corporation A which had been given the payment of war indemnity claim has become a corporation B, the corporation A shall be deemed a corporation which ceased to exist due to amalgamation and the corporation B shall be deemed a corporation which is newly established due to amalgamation, and the provisions of the preceding paragraph shall apply thereto. In case a corporation which had been given the payment of war indemnity claim has ceased to exist due to partition before the enforcement of the present Law, the payment as given to the deceased corporation shall be deemed, as prescribed by Ordinance, as given to the corporation (or its successor) which continues to exist after or which has been newly established by, the partition, for purposes of the present Law.

Article 7. In case a corporation which had been given the payment of war indemnity claim has ceased to exist due to dissolution before the enforcement of the present Law, the payment as given to the corporation shall be deemed, for purposes of application of the present Law, as given to a person (or its successor) who received by transfer special debt certificate (which has been given as the payment of a war indemnity claim, as prescribed by Ordinance, sic passim with the only exception of the cases referred to in Articles 45 and 63) or a blocked account (hereinafter meaning a blocked account, special monetary trusteeship, debtor's special debt certificate and other credits as prescribed by Ordinance, which have been given as the payment of a war indemnity claim) to the extent of the amount of the Government special debt certificate or blocked account which was received by transfer.

Chapter II Taxable Amount, Deduction, Exemption&Tax Rate

Article 8. Taxable amount of war indemnity special tax shall be the amount of a war indemnity claim outstanding on the enforcement date of the present Law or the amount as paid, before the said date, to a war indemnity claim. The amount of claim as referred to in the preceding paragraph shall be judged by the adjudicated amount, or if unadjudicated yet, the amount as claimed by the claimant. Matters necessary for the computation of the amount of war indemnity claim and the computation of the amount already paid thereto shall be provided for by Ordinance besides the provisions of the preceding paragraph.

Article 9. The amount of payment already given before the enforcement of the present Law to such war indemnity claims as are not listed on either of the attached table I-III (in respect to the case where the payment has been given in the form of renovation which is prescribed under Article 5 of the Enterprises Reorganization Financial Measures Law, only the amount refunded, realized, released or extinguished due to confusion, before the enforcement of the present Law, from or in a Government special debt certificate or blocked account) shall not be included in the taxable amount.

Article 10. From the taxable amount for each claim listed on the attached table I, 10,000 yen shall be deducted. The provisions of the preceding paragraph shall not apply in respect to the payment which has not yet been made, on the enforcement date of the present Law, to the claim listed in No.10 of the attached table I. The following amount shall be deducted from the taxable amount for claims listed on the attached table II: 1. Individual: 50,000 yen per claimant 2. Corporate: 10,000 yen per claim In case an individual holds two or more such claims as listed on the attached table II and hence becomes subject to war indemnity special tax, the amount of each claim and/or each payment already given shall be added together and the provisions of Item 1 of the preceding paragraph shall apply in respect to the total. Under no conditions shall any tax-payer be given more than 100,000 yen exemption by virtue of the provisions of the preceding four paragraphs. Matters necessary for the implementation of the preceding paragraph shall be provided for by Ordinance. In respect to the claim listed on the attached table III, 50,000 yen shall be deducted from the taxable amount. The provisions of Paragraph 4 shall apply mutatis mutandis in respect to cases where an individual or a corporation holds two or more of the claims as are listed on the attached table III. The provisions of the preceding two paragraphs shall apply, in respect to a person who holds such claims as are listed on the attached table I or II on the enforcement of the present Law, or who has already been paid thereof before the enforcement of the present Law, only to the case where the amount deductable by virtue of Paragraphs 1 to 6 is under 50,000 yen. In this case, the amount deductable by virtue of the preceding two paragraphs shall be 50,000 yen minus the total of the deductions of Paragraphs 1 to 6. In respect to the computation of the amount to be deducted from the taxable amount, provisions exceptional to the provisions of from Paragraph 1 to the preceding paragraph may be prescribed by Ordinance regarding cases as referred to under Article 5 or 6. In case a war indemnity claim is the one which has been transferred from another person, the amount deductable from the taxable amount shall be computed, notwithstanding the provisions of Paragraphs 1 to 9, in accordance with the provisions as provided for by Ordinance;the same shall hold good in respect to the computation of deductable amount in the case where rights arising out of insurance contract have been transferred without accompanying the transference of the insured property. The provisions of from Paragraph 1 to the preceding paragraph shall not apply in respect to war indemnity claims which are deemed overseas assets. Each claim as referred to in Paragraph 1 and Item 2 of Paragraph 3 and the scope of war indemnity claim to be deemed overseas assets of the preceding paragraph shall be defined by Ordinance.

Article 11. The deductions by virtue of the preceding article shall not be given unless the return as prescribed under Article 14 is filed by the time-limit as prescribed under the same article;provided, however, in the case where the taxable amount does not exceed the deductions allowed, the deductions shall be given in connection with the amount of the war indemnity claim as already paid in cash or the amount already released, realized, refunded or extinguished due to confusion from or in the blocked account prior to the enforcement of the present Law even if the return fails to be filed. Other cases where deductions by virtue of the preceding article are allowable without the filing of Article 14 may be provided for by Ordinance.

Article 12. In case juridical persons as established in accordance with Article 34 of the Civil Code and other non-profit making institutions or corporations as may be prescribed by Ordinance hold, on the enforcement of the present Law, such war indemnity claims as listed on No.1 of the attached table II, or have been paid these claims before the enforcement of the present Law, the Government may, as prescribed by Ordinance, exempt or abate war indemnity special tax as imposed on them, taking consultation with the War Indemnity Special Tax Council. The Government may, as prescribed by Ordinance, postpone the collection of war indemnity special tax pending the final determination of exemption or abatement of the preceding paragraph. Provisions necessary for the War Indemnity Special Tax Council shall be prescribed by Imperial Ordinance.

Article 13. The tax rate of war indemnity special tax shall be 100%.

Chapter III Declaration&Collection

Article 14. A taxpayer shall be liable to file a return of taxable amount and other necessary matters with the Government as prescribed by Ordinance, by the date as prescribed by Ordinance (the date shall hereinafter be called the filing date). A taxpayer who comes under any of the following items shall be liable to file the return as referred to in the preceding paragraph through the banking institution concerned (in case there are two or more institutions concerned, through each of them) as prescribed by Ordinance;in this case, when the banking institution has received the return, it shall be deemed that the return has been filed with the Government in accordance with the preceding paragraph. 1. A person who holds, on the enforcement of the present Law, a blocked account:the banking institution to which the blocked account belongs (it implies, as to a monetary trusteeship, the banking institution to which the trusteeship is trusted;as to a debtor's special debt certificate, the banking institution who is the debter;the same shall hereinafter apply). 2. A person who has transferred his Government special debt certificate or blocked account to a banking institution before the enforcement of the present Law:the banking institution. 3. A person who comes under Paragraph 1 or 2 of Article 34:the banking institution which has received the payment of liabilities. For persons who would be unable to file their returns by the filing date because of hindrances in communication or transportation or other reasons exceptional provisions regarding the time-limit for the filing of return may be provided for by Ordinance. "Banking institutions" within the meaning of the present Law shall mean banks, trust companies and other juridical persons as prescribed by Ordinance.

Article 15. A taxpayer shall he liable to pay war indemnity special tax by the filing date as referred to in the preceding article. In case the taxpayer has filed return in accordance with Paragraph 2 of the preceding article, the banking institution concerned shall collect the war indemnity special tax and send the same to the Government by the last day of the month following the filing date.

Article 16. The amount of the tax which a taxpayer is liable to pay shall be, in the case of Article 33 or 34, computed by deducting the amount of tax which a person who is liable to pay on behalf of him is to pay in accordance with said article from the amount of war indemnity special tax as computed by applying Articles 10-13 to the taxable amount.

Article 17. A war indemnity claim which a taxpayer holds on the enforcement of the present Law shall become extinct, to the extent of the amount of war indemnity special tax, simultaneously with the filing of report as prescribed under Article 14 (or, at the expiration of the filing date prescribed in the same article in case no return is filed by the filing date). In the case of the preceding paragraph, the taxpayer shall be deemed to have paid war indemnity special tax imposable on the amount of war indemnity claim which has become extinct.

Article 18. If, in the case of Article 15 a taxpayer has, on the enforcement of the present Law, a Government special debt certificate or a blocked account, he shall be liable to pay war indemnity special tax firstly by transferring the Government special debt certificate to the Government, or in the form of cashes as obtained by having the blocked account realized, released or refunded before maturity.

Article 19. In the case where a taxpayer who holds a Government special debt certificate has failed to file the return of Paragraph 1 of Article 14 by the filing date or in other cases as may be prescribed by Ordinance, the Government shall collect the tax in the form of the Government special debt certificate, on the day next to the filing date. In the case where a taxpayer who holds a blocked account has failed to tile the return of Paragraph 1 of Article 14 by the filing date or in other cases as may be prescribed by Ordinance, the banking institution with which the blocked account has been set shall, on the day next to the filing date, realize, release or refund the blocked account before maturity, appropriate the cash therefrom to the payment of war indemnity special tax and send the same to the Government by the last day of the month following the filing date, as prescribed by Ordinance.

Article 20. The application of the provisions of the preceding two articles shall not be hindered even in case the Government special debt certificate or the blocked account has been pledged as security (including the pledge as prescribed under Article 3 of the National Tax Collection Law), or the compulsory execution procedure, compulsory collection procedure of the National Tax Collection Law or other procedures of similar nature is in process regarding the Government special debt certificate or the blocked account. The pledge set on the Government special debt certificate shall become extinct simultaneously with the payment as made in the form of said certificate in accordance with Article 18 or Paragraph 1 of the preceding article. Provisions necessary for cases of preceding two articles shall be provided for by Ordinance, besides the provisions of the preceding two paragraphs.

Article 21. In case a person who filed the return in accordance with Article 14 failed to pay war indemnity special tax by the filing date prescribed in the same article, the Government shall enforce the payment in accordance with the provisions prescribed in Article 9 of the National Tax Collection Law. The provisions of the preceding paragraph shall apply in respect to cases where the Government collects war indemnity special tax the collection of which was postponed in accordance with Article 12, Paragraph 2 in the form of blocked accounts, pursuant to the National Tax Collection Law.

Article 22. In case the banking institutions as referred to in Article 15 or 19 have gained credits owing to the accommodation of fund to non-life insurance companies or the Non-Life Insurance Central Association necessary for the payment claims as listed on No.14 of the attached table I or No.1 or 2 of the attached table II, the credits shall become extinct on the day next to the filing date as prescribed by Ordinance to the extent equivalent to the amount of war indemnity special tax which the banking institution is to send in accordance with Paragraph 2 of Article 15 or Paragraph 2 of Article 19;in this case, the banking institutions shall be exempt from sending the tax to the Government which is to be done pursuant to Paragraph 2 of Article 15 or Paragraph 2 of Article 19, to the extent equivalent to the amount of the credits extinguished. The provisions of the preceding paragraph shall apply mutatis mutandis in respect to the case where banking institutions have gained credits owing to the accommodation of fund to the People's Reconversion Bank or the Industrial Equipment Corporation for the payment of the claim listed on the attached table III. In the case of the preceding two paragraphs, the banking institutions shall, as prescribed by Ordinance, report to the Government and non-life insurance companies or the Non-Life Insurance Central Association, the People's Reconversion Bank, or the Industrial Equipment Corporation, of the amount of the extinguished credits and other necessary matters.

Article 23. A taxpayer in the case where he is to pay the tax or a part thereof in cash may request to the Government the payment in kind, or delayed payment upon presenting proper mortgages, when it is difficult to complete the payment. The kind of property to be used as the instrument of payment and other necesssry matters for the payment in kind shall be prescribed by Ordinances. In the case as referred to in Paragraph 1, the payment may not delay more than two years after the filing date. The kind of mortgages and other matters necessary for the delayed payment shall be prescribed by Ordinance. The Government, on receiving the request of Paragraph 1, may, when deems necessary, postpone the collection of the tax concerned. Additional tax computed on the basis of 10% per annum interests rate on the amount of tax in abeyance shall be paid as prescribed by Ordinance, if the delayed payment of Paragraph 1 is permitted.

Article 24. In case there are two or more inheritors in the case of Article 5, each inheritor shall be liable to pay war indemnity special tax in proportion to the amount of net shares of estate accrued to each (in case liabilities are also inherited, the amount thereof shall be deducted fiom the inherited net shares of estate). If, in the case of the preceding paragraph, the amount of liabilities inherited is over the same of the inherited property, the amount of war indemnity tax each inheritor is to pay shall be prescribed by Ordinance. In the case of the preceding two paragraphs, each inheritor shall be jointly liable to pay war indemnity special tax with the other. If, in the case of Article 5, the inheritance is an inheritance of household on which the predecessor reserved a part of property for himself, the predecessor shall jointly be liable with the inheritor to pay war indemnity special tax which the inheritor is to pay. The corporation established by partition (or its successor) shall be jointly liable to pay war indemnity special tax which the other corporation established by the partition (or its successor) is to pay pursuant to Paragraph 3 of Article 6 or the other corporation which continues to exist after the partition (or its successor) is to pay because of war indemnity claims it gained before the partition. The provisions of the preceding three paragraphs shall not apply in respect to the amount of war indemnity special tax which is equivalent to the amount to be paid in the form of Government special debt certificates or in the form of cashes which accrued from the realization release or refundment, before maturity, of blocked accounts.

Article 25. A taxpayer, when necessary for the payment of war indemnity special tax, may request the payment, before maturity, of deposits, savings or other credits as may be prescribed by Ordinance or a part thereof, or may cancel or change the contracts relating thereto, as prescribed by Ordinance. In the case of the preceding paragraph, the amount which the other party of the contract is to pay to the taxpayer and other matters relating thereto may be prescribed by Ordinance.

Article 26. In respect to the application of Paragraph 2 of Article 14, Paragraph 2 of Article 15, Paragraph 2 of Article 19, Paragraph 2 of Article 35, Paragraph 2 of Article 36, Paragraph 2 of Article 38 and Article 45 the Industrial Equipment Corporation shall be deemed a banking institution.

Chapter IV Correction&Determination of Taxable Amount

Article 27. In case the return is filed in accordance with Article 14 the Government shall examine the same and, in case of difference from the taxable amount investigated by the Government, correct the returned taxable amount. The Government shall determine the taxable amount on its own investigation in case a person who is deemed liable to pay the tax has failed to file his return in accordance with Article 14 (provided that, however, the taxable amount of the war indemnity claims extinguished by virtue of Article 17 shall be excluded therefrom). In case an omission has been found in the corrected or determined taxable amount after the correction or determination as referred to in the preceding two paragraphs, the Government may revise the corrected or determined amount. The correction or determination of the preceding three paragraphs may and shall be made within 5 years after the enforcement date of the present Law.

Article 28. The Government, having corrected or determined the taxable amount in accordance with the preceding article shall notify the same to the taxpayer. In case a person who has no domicile or residence or has no office or business place within the enforcement area of the present Law, has failed to inform the Government of its tax payment agent, the notification as referred to in the preceding paragraph may be made in the form of public notice. In this case, it shall be deemed that the notification has been made if and when 7 days have elapsed after the first day of the publication.

Article 29. When the Government has corrected or determined the taxable amount in accordance with Article 27, the Government shall request the taxpayer to pay the determined or additional tax within the time limit of a month after the notification of the preceding article has been issued. If, in the case of the preceding paragraph, an amount has already been paid in accordance with Article 19, the amount shall be deducted from the tax requested to be paid by virtue of the preceding paragraph.

Chapter V Reinvestigation, Petition&Administrative Litigation

Article 30. In case a taxpayer has any objection in respect to the corrected or determined taxable amount as notified by the Government in accordance with Article 27, he may request reinvestigation to the Government stating the reason for the dissatisfaction within a month from the date at which the notification is received. The Government will not postpone the collection of tax even if the request by virtue of the preceding paragraph is made.

Article 31. In case the request is made by virtue of Paragraph 1 of the preceding article, the Government shall settle the objection and inform the settlement to the taxpayer.

Article 32. A person who has an objection to the settlement of the preceding article, may make petition to the Government or appeal to the Administrative Litigation Court.

Chapter VI Payment in Subrogation

Article 33. A person who is other than taxpayer and who, on the effective date of the present Law, holds a Government special debt certificate or blocked account shall be liable to pay war indemnity special tax up to the amount of his Government special debt certificate or blocked account, on behalf of the taxpayer. If, in the case of the preceding paragraph, the total amount of a Government special debt certificate or blocked account held by a taxpayer on the effective date of the Law and the same held by a person who is liable to pay the tax on behalf of him (the person shall hereinafter be called a subrogator) is in excess of the amount of war indemnity special tax which is computed by applying the provisions of Articles 10 to 13 to the taxable amount of the taxpayer, the subrogator shall be liable to pay war indemnity special tax on behalf of the taxpayer, up to the whole amount of war indemnity special tax minus the amount of the Government special debt certificate or blocked account which is held by the taxpayer on the effective date of the present Law;in case there are two or more subrogators, each shall be liable to pay in accordance with the provisions of Ordinance.

Article 34. If a taxpayer, in the case where the provisions of Article 4 of the Enterprises Reorganization Financial Measures Law or Article 10-(11) of the Temporary Fund Accomodation Adjustment Law has been applied, has had his war indemnity claim paid not in accordance with the formula of renovation as prescribed under Article 5 of the Enterprises Reorganization Financial Measures Law (or similar formulae as prescribed by Ordinance), in order to pay back his liabilities to a banking institution, the banking institution (or its successor) shall be liable to pay war indemnity special tax on behalf of the taxpayer up to the extent of the amount which has been paid back. In case a person who held a blocked account or transferee of the same (including successors of these) has had the blocked account or a part thereof withdrawn, released or refunded before maturity and thereby paid back his liabilities to a banking institution or has transferred his blocked account or a part thereof to a banking institution in order to pay back his liabilities, the banking institution (or its successor) shall be liable to pay war indemnity special tax on behalf of the taxpayer, up to the extent of the amount which the banking institution has been paid back.(In case the blocked account was retransferred by the banking institution to other person, the amount thereof shall be excluded). The provisions of Paragraph 1 of the preceding article shall not apply in respect to the banking institutions (or its successors there of) to which the blocked account has been transferred as referred to in the preceding paragraph. The provisions of Paragraph 2 of the preceding article shall apply mutatis mutandis in respect to cases as referred to in Paragraphs 1 and 2.

Article 35. A subrogator shall be liable, as prescribed by Ordinance, to file a return with the Government by the filing date, stating therein the amount of such Government special debt certificate or blocked account as is referred to in Paragraph 1 of Article 33, the amount of such collected loan as referred to in Paragraphs 1 and 2 of the preceding article and other necessary matters. In case a subrogator holds a blocked account on the effective date of the present Law, the return of the preceding paragraph shall be filed through the channel of the banking institution to which the account of the blocked account belongs;in this case, the return shall be deemed to have been filed according to the provisions of the same paragraph with the Government when it is received by the banking institution. The provisions of Paragraph 3 of Article 14 shall apply mutatis mutandis in respect to the filing of return as prescribed under Paragraph 1.

Article 36. A subrogator shall, as prescribed by Ordinance, be liable to pay war indemnity special tax by the filing date of the preceding article. If, in the case of the preceding paragraph, the subrogator has filed the return in accordance with Paragraph 2 of the preceding article, the banking institution concerned shall be liable to collect the tax from the subrogator and send the same to the Government by the last day of the month following the filing date.

Article 37. In the case where a taxpayer failed to file the return prescribed in Article 14, but the subrogator filed the return prescribed in Article 35, the application of the provisions of Article 10 in respect to the computation of war indemnity special tax which the subrogator is to pay on behalf of the taxpayer shall not be hindered.

Article 38. In the case where a subrogator who, on the effective date of the present Law, holds a Government special debt certificate has failed to file the return by the filing date in accordance with Paragraph 1 of Article 35 or in cases as prescribed by Ordinance, the Government shall collect war indemnity special tax on the day next to the filing date in the form of the Government special debt certificate. In the case where a subrogator who, on the effective date of the present Law, holds a blocked account has failed to file the return by the filing date in accordance with Paragraph 1 of Article 35 or in cases as may be prescribed by Ordinance, the banking institution with which the blocked account is set shall, on the day next to the filing date, refund, realize or release, before maturity, the blocked account, collect war indemnity special tax in the form of cashes accrued therefrom, and send the same to the Government by the last day of the following month following the filing date. The provisions of Paragraphs 1 and 2 of Article 20 shall apply mutatis mutandis in respect to the case of the preceding paragraphs. Provisions necessary for cases of Paragraphs 1 and 2 shall be provided for by Ordinance, besides the provisions of the preceding paragraph.

Article 39. If in the case of Article 36 or the preceding article, the subrogator has gained credits owing to the accomodation of fund as given to non-life insurance companies or the Non-life Insurance Central Association which was necessary for the payment of claims listed in No.14 of the attached table I or No.1 or 2 of the attached table II, the credit shall become extinct, as prescribed by Ordinance, on the day next to the filing date to the extent equivalent to the amount of war indemnity special tax which the subrogator is to pay pursuant to Paragraph 2 of Article 36 or Paragraph 2 of the preceding article;in this case, the subrogator shall be exempt to pay the tax which is to be paid pursuant to said articles, to the extent equivalent to the amount of the credits extinguished. The provisions of the preceding paragraph shall apply mutatis mutandis in respect to the case where a subrogator has accommodated fund necessary for the payment of the claim as listed in the attached table III to the People's Reconversion Bank or the Industrial Equipment Corporation and thereby has obtained credits. In the case of the preceding two paragraphs, the subrogator shall, as prescribed by Ordinance, report to the Government and non-life insurance companies or the Non-Life Insurance Central Association, or the People's Reconversion Bank or the Industrial Equipment Corporation of the amount of the extinguished credits and other necessary matters.

Article 40. The provisions of Articles 18 and 21 shall apply mutatis mutandis in respect to war indemnity special tax which a subrogator is to pay. The provisions of Article 22 shall apply mutatis mutandis in respect to the banking institution, with whom a subrogator has set a blocked account. The provisions of the preceding two Chapters shall apply mutatis mutandis in respect to the correction, determination, re-investigation, petition and administrative litigation of war indemnity special tax which a subrogator is to pay.

Article 41. In case a subrogator who pays war indemnity special tax in accordance with Article 33 had obtained the Government special debt certificate or blocked account for countervalue, the subrogator, as prescribed by Ordinance, may request to the transferrer (or its successor) the recovery for the countervalue at which the Government special debt certificate, which was appropriated as the payment of the tax or the blocked account which was realized, released or refunded before maturity for the purpose of tax payment had been obtained. In case the transferrer who was requested the recovery by virtue of the preceding paragraph has complied with the request and paid the recovery claim, he may, as prescribed by Ordinance in turn request the recovery for the countervalue, if any, of the Government special debt certificate or the blocked account to the preceding holders. The provisions of the preceding paragraph shall apply mutatis mutandis to the case where a person (or its successor) who is other than said transferrer of the preceding paragraph and who had transferred the Government special debt certificate or blocked account has complied with the request and paid the recovery claim. The pledge set on the Government special debt certificate or blocked account owned by the subrogator shall remain on the recovery claim of Paragraph 1, in the case of Paragraph 1.

Article 42. A subrogator who paid war indemnity special tax in accordance with Article 34 may, as prescribed by Ordinance, request recovery to taxpayers and other persons (on successors thereof) who refunded liabilities pursuant to the same article, within the extent of the tax paid. The provisions of Paragraphs 2 to 4 of the preceding article shall apply mutatis mutandis in respect to cases as referred to in the preceding paragraph.

Chapter VII Miscellaneous Provisions

Article 43. A taxpayer shall be liable, in the case of Article 33 or 34, to inform the subrogator of his taxable amount and other necessary matters, as prescribed by Ordinance. A subrogator shall be liable to inform the taxpayer of the amount of the Government special debt certificate of blocked account as prescribed under Paragraph 1 of Article 33, the paid amount as prescribed under Paragraph 1 or 2 of Article 34 and other necessary matters, as prescribed by Ordinance.

Article 44. In case a corporation has dissolved and distributed its assets without completing war indemnity special tax payment, the liquidators shall jointly be liable to pay the tax.

Article 45. In case a banking institution has found it difficult because of its financial condition to cash war indemnity special tax it collected and send the same to the Government pursuant to Paragraph 2 of Article 15, Paragraph 2 of Article 19, Paragraph 2 of Article 36, or Paragraph 2 of Article 38, the banking institution may, as prescribed by Ordinance, with the permission of the Government, send a Government special debt certificate it holds to the Government instead of sending cashes and appropriate the same as the payment of war indemnity special tax.

Article 46. Such juridical persons as designated by Ordinance shall, as prescribed by Ordinance, be liable to file a return regarding war indemnity claims to the Government.

Article 47. Taxation officials, when necessary for the purpose of investigation or collection of war indemnity special tax, may ask question to persons liable or deemed liable to pay the tax and to persons liable or deemed liable to pay the tax in subrogation, or inspect their books, papers or other things relating to war indemnity claims.

Article 48. Taxation officials may, when necessary for the purpose of investigation or collection of war indemnity special tax, ask questions to the persons as enumerated below or inspect their books, papers and other things relating to war indemnity claims: 1. Persons who are liable to file returns in accordance with Article 46. 2. Persons who are deemed to have transferred property regarding war indemnity claims to persons liable or deemed liable to pay the tax. 3. Persons who are deemed to have acquired property regarding war indemnity claims from persons liable or deemed liable to pay the tax.

Article 49. Taxation officials, when necessary for the purpose of investigation of war indemnity special tax, may ask questions to those who were Governmental or other officials or members of specified instrumentalities and who were engaged in war indemnity claims business. The Government, when necessary for the purpose of investigation of war indemnity special tax, may, as prescribed by Ordinance, order the persons as referred to in the preceding paragraph to present themselves to the authority concerned. Daily allowances and travelling expenses shall be granted to those who presented themselves pursuant to the order of the preceding paragraph.

Article 50. The place of payment of war indemnity special tax shall be for an individual, his domicile, or in case there is no domicile within the enforcement area of the present Law, his residence, and for a juridical person, the place of its head office or principal business place; provided that, however, an individual may with the permission of the Government appoint his residence to be the place of payment. An individual having no domicile or residence within the enforcement area of the present Law or a juridical person having no head office or principal business place within the same area shall, as prescribed by Ordinance, decide the place of payment and inform the same to the Government. In case of no information, the Government shall appoint the place of payment.

Article 51. A taxpayer of subrogator either individual or corporate, which does not have domicile or residence, or office or business place within the enforcement area of the Law, shall be liable to appoint and report to the Government a taxpayment agent who, living at the place of payment, taken charge of the filing of return as referred to in Article 14 or 35 and every other necessary matters of war indemnity special tax;the same shall hold good in respect to the case where a taxpayer or subrogator either individual or corporate is going to discontinue to have domicile or residence, or office or business place within the enforcement area of the present Law.

Article 52. No surtax to war indemnity special tax shall be imposed by prefectures, cities, towns, villages and other public bodies.

Article 53. In case a taxpayer has paid war indemnity special tax as assessed on the war indemnity claims which had been transferred to him (including rights arising out of insurance contracts which had been transferred to him without accompanying the transference of objects of the insurance) or in case a taxpayer has complied with the request of Paragraphs 1 to 3 of Article 41 or Paragraphs 1 and 2 of Article 42 and paid the recovery claim, he may, as prescribed by Ordinance, request the recovery for the countervalue, if any, of the claims to the transferrer. The provisions of Paragraphs 2 to 4 of Article 41 shall apply mutatis mutandis in respect to the case of the preceding paragraph.

Article 54. In case the business profits arising out of war indemnity claims of an individual have been counted in income of the Income Tax Law, net profits of the business tax law and/or profits of the old Extraordinary Excess Profits Tax Law, the amount equivalent to the excess of income tax, business tax, surtax thereof and/or extraordinary excess profits tax thus computed over the same computed by eliminating above said business profits shall, as prescribed by Ordinance, be abated from the income tax, business tax, surtax thereof and/or extraordinary excess profits tax.

Article 55. In case a corporation has counted normal income, net profit, profit or surplus arising out of war indemnity claims, on the settlement of its account, the amount equivalent to the excess of corporation tax, business tax, surtax thereof, extraordinary excess profits tax or special corporation tax thus computed over the same as computed by eliminating income, net profit, profit or surplus arising out of the war indemnity claims shall be abated or exempted, as prescribed by Ordinance.

Article 56. On computing normal income of the Corporation Tax Law, net profits of the Business Tax Law or surplus of the special corporation tax law, the amount of war indemnity special tax which a corporation paid or is to pay shall not be counted as loss. On computing normal income of the Corporation Tax Law, net profits of the Business Tax Law or surplus of the Special Corporation Tax Law, the amount of profits of a corporation arising out of reappraisal or transference of assets (excluding commodities and others as may be prescribed by Ordinance), profits arising out of immunity from liabilities or out of decrease in capital or such profits as may be prescribed by Ordinance shall not, as prescribed by Ordinance, be counted in profits, so long as the total thereof does not exceed the amount of war indemnity special tax minus the amount of profits arising out of the war indemnity claim. In case the transferrer of a war indemnity claim is to be requested recovery pursuant to Paragraph 1 of Article 53, the amount to be recovered shall be deemed the amount of war indemnity special tax for purposes of the application of the preceding two paragraphs.

Article 57. In case the inheritance tax is assessed, before the enforcement of the present Law, on inherited property in which war indemnity claims, Government special debt certificates or blocked accounts were included (including the property as donated by the predecessor within a year before the inheritance;the same shall apply hereinafter) the excess of the tax thus assessed over the tax assessed on the inherited property after eliminating thereof the whole or a part of the amount of the war indemnity tax shall, as prescribed by Ordinance, be deducted or exempted. In case the predecessor had acquired some property in exchange for a Government special debt certificate or blocked account before the occurrence of inheritance, the provisions of the preceding paragraph shall apply thereto;in this case the amount of war indemnity special tax deductable from the taxable amount shall not exceed the taxable amount of the acquired property minus the amount of the war indemnity claim less the deductable amount of Article 10.

Article 58. In case war indemnity special tax is assessed on a war indemnity claim arising out of property inherited by an inheritance occurred before the enforcement of the present Law the amount obtainable by applying the percentage of such amount of the war indemnity special tax as is prescribed by Ordinance to the taxable amount of inherited property, to the amount of inheritance tax shall, as prescribed by Ordinance, be exempted or deducted from the amount of inheritance tax designated to be paid after August 15, 1945.

Article 59. In respect to the payment of indemnity of loss to non-life insurance companies which is to be paid in accordance with Article 16 of the old War Risk Insurance Law (meaning the same article as it read before the revision by virtue of Article 56 of the Non-Life Insurance Central Association Law). The amount equivalent to the amount of credits extinguished by virtue of Article 22 (including the same article as applied by virtue of Article 40) and Article 39 shall be deducted from said loss of insurance companies which is to be indemnified.

Article 60. In the case where lands or buildings (including things fixed on the lands or buildings;the same shall apply in this article) or mining rights or placer right have been transferred to the nation, local public bodies or specified instrumentalities or land or buildings have been appropriated by the nation or local public bodies, if war indemnity special tax is assessed on claims for the restitution thereof, the nation, local public bodies or specified instrumentalities shall, at the request of the original holders or successors thereof, as long as they still hold the lands, buildings, mining rights or placer rights on the enforcement of the present Law, be liable, to return the lands, buildings, mining rights or placer rights to the original holders (or successors), in their present conditions. A person who is going to request to have lands, buildings, mining rights or placer rights returned by virtue of the preceding paragraph shall pay the countervalue to the nation, local public bodies or specified instrumentalities, equivalent to the amount of the restitution for the appropriation by or transference to the nation, local public bodies or specified instrumentalities minus the amount of war indemnity special tax imposed on the restitution claim. In the case of the preceding paragraph, the original holder (or its successor) shall also pay a reasonable value for the improvements, if any, to the lands or buildings made by the nation, local public bodies or specified instrumentalities. If, in the case where local public bodies or specified instrumentalities have returned the lands, buildings, mining rights or placer rights to the original holders (or successors thereof), the Government shall give to the local public bodies or specified instrumentalities the whole or a part of the amount equal to war indemnity special tax imposed on the restitution claim held by the original holders for the appropriation or transference of the lands, buildings, mining rights or placer rights. Applications to the nation, local public bodies or specified instrumentalities for requests to have lands, buildings, mining rights or placer rights returned shall be made within 3 months of the filing date of war indemnity special tax return matters necessary for the implementation of Paragraphs 1 to 4 shall be provided for by Ordinance, besides those of the preceding paragraph.

Article 61. In the case where mining rights or placer rights have extinguished after the transference to the nation, local public bodies or specified instrumentalities, or in other cases as may be prescribed by Ordinance, if war indemnity special tax is assessed on claims for the countervalue thereof or on other claim as may be prescribed by Ordinance, the original holders of these rights or their successors shall, notwithstanding the provisions of Article 33 of the Mining Law, be granted priority in the applications for licenses for mining rights or placer rights aiming to the same mining pits or the same placer as old. Persons who are going to apply for licenses for mining rights or placer rights pursuant to the preceding paragraph shall, as prescribed by Ordinance, apply to the Government within 3 months after the filing date of war indemnity special tax return. Matters necessary for the implementation of Paragraph 1 shall be provided for by Ordinance, besides the provisions of the preceding paragraph.

Article 62. Even if war indemnity special tax has been imposed on a war indemnity claim arising out of a contract of bilateral obligations of which the obligation on the part of the war indemnity claimant had already been fulfilled before the enforcement of the present Law, this shall not, not withstanding any other statutes or contracts excepting the provisions of the preceding two paragraphs, entitle the taxpayer to a claim for the return of things or any other claims under justification of the payment of war indemnity special tax. In case war indemnity special tax has been imposed on a war indemnity claim arising out of a contract of bilateral obligations, the taxpayer, notwithstanding any other statutes or contracts, will no more be obligated, after the enforcement of the present Law, to fulfil his obligation stipulated in the contract. A person who is other than taxpayers and who originally obtained a war indemnity claim shall be deemed a taxpayer for purposes of applying the preceding two paragraphs.

Article 63. Government special debt certificates remain valid after the taxpayers and subrogators have paid war indemnity special tax (including the same as remains to persons who become exempt from paying the tax by virtue of the deductions of Article 10) and Government Special debt certificates held by persons who are not liable to pay war indemnity special tax shall become registered national bonds on the basis of yen for yen as prescribed by Ordinance.

Article 64. The Government may, as prescribed by Ordinance, pay war indemnity claims against the Government which remain valid after the collection of war indemnity special tax (including claims held by persons who become exempt, from the tax by virtue of deductions of Article 10) through the medium of granting national bonds. The national bonds to be granted pursuant to the preceding paragraph shall be valued at face value The Government may issue national bonds up to the limit of the amount to be necessary to pay the liabilities arising out of the claims as referred to in Paragraph 1.

Article 65. War indemnity claims for the supply of things other than money, which are valid on the enforcement of the present Law, shall become extinct on the enforcement date of the present Law.

Article 66. The Government, notwithstanding other statutes or contracts, will not compensate the loss caused or causable on corporations or other juridical persons due to the accomodation of fund, application to or underwriting or purchase of securities, or underwriting or guarantee of debt which they made on or before August 15, 1945;provided that this shall not hold good in respect to cases as may be designated by Ordinance.

Article 67. Guarantees given by the Government to corporations and other juridical persons (excluding guarantees as may be prescribed by Ordinance) shall become void on and after the enforcement date of the present Law.

Chapter VIII Penalties

Article 68. A person who has evaded war indemnity special tax by an act of fraud or other unjust means shall be imprisoned not exceeding 1 rear or fined not exceeding 100,000 yen.

Article 69. A person coming under any of the following items shall be imprisoned not exceeding one year or fined not exceeding 10,000 yen: 1. A person who has failed to file the return as referred to in Article 46 without good reasons or filed the return stating falsehoold. 2. A person who has refused, disturbed or evaded the inspection of books, papers or other things as conducted in accordance with Article 47 or 48. 3. A person who has presented the documents of the preceding clause stating falsehood therein. 4. A person who has failed to answer to the questions put by taxation officials pursuant to Article 47 or 48 or Paragraph 1 of Article 49. 5. A person who has answered falsehood to the questions of the preceding clause.

Article 70. In case a representative of a juridical person, a deputy, employee or member of a juridical person or of an individual has committed violations as referred to in Article 68 or Paragraph 1 or Items 3 to 5 of the preceding Article, regarding the business or property of the individual or juridical person, the person who actually committed the violation shall be punished and besides as the juridical person or the individual shall be fined in accordance with the provisions of the Articles concerned.

Article 71. In respect to a person who has committed the violation as prescribed under Article 68, the provisions of the proviso of Paragraph 3 of Article 38, Paragraph 2 of Article 39, Articles 40 and 41, Paragraph_2 of Article 48 and Articles 63 and 66 of the Penal Code shall not apply, provided that this shall not hold good in respect to the case where imprisonment is inflicted.

Article 72. A person who has failed to file a return by the time-limit of Article 14 or 35 pursuant to the said Article shall forfeit not exceeding 5,000 yen.

Article 73. In case a person who is ordered to Present himself fails to present himself without good reasons he shall forfeit not exceeding 1,000 yen for each failure.

Chapter IX Supplementary Provisions

Article 74. Provisions similar to the present Law shall be provided for by the Imperial Household Ordinance regarding the disposal of war indemnity claims of Imperial Household properties.