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and sixty-six, shall be made on the first Monday of January and July of each year, in such form and manner as may be prescribed by the Commissioner of Internal Revenue. [As amended by the act of July 13, 1866, chapter 184, § 9.]

ACT OF MARCH 3, 1865, CHAPTER 78.

AN ACT TO AMEND AN ACT ENTITLED “AN ACT TO PROVIDE INTERNAL REVENUE

TO SUPPORT THE GOVERNMENT, TO PAY INTEREST ON THE PUBLIC DEBT, AND
FOR OTHER PURPOSES," APPROVED JUNE 30, 1864.

TAX ON NOTES OF STATE BANKS, &C.

sons and State

circulation.

Sec. 6. And be it further enacted, That every national Ten per cent. tax banking association, State bank, or State banking associa- on notes of pertion, shall pay a tax of ten per centum 34 on the amount banks used for of notes of any person, State bank, or State banking association, used for circulation and paid out by them after the first day of August, eighteen hundred and sixty-six, and such tax shall be assessed and paid in such manner as shall be prescribed by the Commissioner of Internal Revenue. [As amended by act of July 13, 1866, chapter 184, $ 9 bis.]

CONVERSION OF STATE BANKS WITH BRANCHES.

SEC. 7.

Provided, That it shall be lawful for State banks with any bank or banking association organized under State branches inay laws, and having branches, the capital being joint and banks and retain assigned to and used by the mother bank and branches in

become national

branches.

34. This section, taxing banks ten per cent. on the amount of notes of State banks paid out by them, is held to be constitutional by the Supreme Court of the United States. (Veazie Bank v. Fenno, 8 Wallace, 534 )

The tax applies to the notes which a bank pays out of its own issue as well as of the issue of other banks. (Official Opinion of Attorney General Williams, 1972; Veazie Bank v. Fenno, 8 Wallace, 534.)

The act of March 26, 1867, chapter 8, section 2, lays à tax of ten per cent. on the notes of any town, city, or municipal corporation paid out for circulation. (See page 148 )

And the act of July 17, 1862, chapter 196, section 2, makes it a penal offence to make, issue, circulate, or pay any note, check, memorandum, token, or other obligation for a less sum than one dollar, intended to circulate as money, or to be received or used in lieu of lawful money. (See page 45.)

definite proportions, to become a national banking association in conformity with existing laws, and to retain and keep in operation its branches, or such one or more of them as it may elect to retain; the amount of the circulation redeemable at the mother bank and each branch to be regulated by the amount of capital assigned to and used by each.

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CAPITAL OF BANKS CONVERTED.

Capital of State banks converted.

Sec. 14. And be it further enacted, That the capital of any State bank or banking association, which has ceased or shall cease to exist, or which has been or shall be converted into a national bank, shall be assumed to be the capital as it existed immediately before such bank ceased to exist or was converted as aforesaid.

CIRCULATION, WHEN NOT TAXABLE.

Circulation not taxable when it

does not exceed five per cent. of capital.

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And whenever the outstanding circulation of any bank, association, corporation, company, or person shall be reduced to an amount not exceeding five per centum of the chartered or declared capital existing at the time the same was issued, said circulation shall be free from taxation; and whenever any bank which has ceased to issue notes for circulation shall deposit in the Treasury of the United States, in lawful money, the amount of its outstanding circulation, to be redeemed at par, under such regulations as the Secretary of the Treasury shall prescribe, it shall be exempt from any tax upon such circulation;

TAX ON STATE BANKS AFTER CONVERSION.

National banks converted from State banks

And whenever any State bank or banking association has been converted into a national banking association, and such

35. This provision relieves banks which are withdrawing their circulation or have reduced it to five per cent. of their capital, for any reason, from the tax imposed on national banks by section 41 of the act of June 3, 1864, (see page 125,) and on State banks by section 110 of the act of June 30, 1864, as amended by the act of July 13, 1866, (see page 142,) but not from the ten per cent. tax imposed on amount of notes of any State bank or banking association, whether notes of their own or those of other banks, by section 6 of the act of March 3, 1865, as amended by act of July 13, 1866, section 9. (See page 145.) (Official Opinion of Attorney General Williams, 1872)

from latter and

national banking association has assumed the liabilities of -to pay tax due such State bank or banking association, including the re- make returns, &c. demption of its bills, by any agreement or understanding whatever with the representatives of such State bank or banking association, such national banking association shall be held to make the required return and payment on the circulation outstanding, so long as such circulation shall exceed five per centum of the capital before such conversion of such State bank or banking association. [As amended by act of July 13, 1866, chapter 184, § 9 bis. ]

ACT OF MARCH 2, 1867, CHAPTER 194.

AN ACT TO PROVIDE WAYS AND MEANS FOR THE PAYMENT OF COMPOUND-INTER

EST NOTES.

or three per cent.

.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That for Temporary loan the purpose of redeeming and retiring any compound-inter- certificates est notes outstanding, the Secretary of the Treasury is hereby authorized and directed to issue temporary loan certificates, 36 in the manner prescribed by section four of the act entitled "An act to authorize the issue of United States notes and for the redemption or funding thereof, ani! for funding the floating debt of the United States,'' approved February twenty-fifth, eighteen hundred and sixtytwo, bearing interest at a rate not exceeding three per centum per annum, principal and interest payable in lawful money on demand ;

And said certificates of temporary loan may constitute May he held by and be held, by any national bank holding or owning the banks as part of same, as a part of the reserve provided for in sections thirtyone and thirty-two of the act entitled "An act to provide a national currency, secured by a pledge of United States bonds, and to provide for the circulation and redemption

their reserver,

36. By the act of July 25, 1868, chapter 237, the amount of temporary loan certificates to be issued was increased to seventy-five millions dollars, and by the act of July 12, 1870, chapter 252, section 2, they are all required to be called in for payment as fast as additional currency notes are issued under that act. When called in for payment they cease to bear interest, and can no longer be held as part of the bank reserves. (See page 28.)

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thereof,” approved June three, eighteen hundred and sixtyfour: Provided, That not less than two-fifths of the entire reserve of such bank shall consist of lawful money of the United States: And provided further, That the amount of such temporary certificates at any time outstanding shall not exceed fifty millions of dollars.

Approved, March 2, 1867.

ACT OF MARCH 26, 1867, CHAPTER 8.

AN ACT TO EXEMPT WRAPPING PAPER, MADE FROM WOOD OR CORNSTALKS, FROM

INTERNAL TAX, AND FOR OTHER PURPOSES.

Banks and bank

cent. tax on

of towns, cities, and municipal

SEC. 2. And be it further enacted, That every national ers to pay ten per banking association, State bank, or banker, or association amount of notes shall pay a tax of ten per centum on the amount of notes

of any town, city, or municipal corporation paid out by corporations paid them after the first day of May, anno Domini eighteen

hundred and sixty-seven, to be collected in the mode and manner in which the tax on the notes of State banks is collected.

Approved, March 26, 1867.

out by them.

ACT OF FEBRUARY 10, 1868, CHAPTER 7.

AN ACT IN RELATION TO TAXING SHARES IN NATIONAL BANKS.

banks may be taxed.

Be it enacted by the Senate and House of Representatives Where shares of of the United States of America in Congress assembled, That

the words “place where the bank is located, and not elsewhere,'' in section forty-one of the "act to provide a national currency," approved June third, eighteen hundred and sixty-four, shall be construed and held to mean the State within which the bank is located; and the Legislature of each State may determine and direct the manner and place of taxing all the shares of national banks located within said State, subject to the restriction that the taxation shall not be at a greater rate than is assessed upon any other moneyed capital in the hands of individual citizens of such State: And provided always, That the shares of any national bank, owned by non-residents of any State shall be

Shares of nonresidents.

taxed in the city or town where said bank is located, and not elsewhere.

Approved, February 10, 1868.

ACT OF FEBRUARY 19, 1869, CHAPTER 32.

AN ACT TO PREVENT LOANING MONEY UPON UNITED STATES NOTES.

ceiving U.S. notes as security

loans, or

lise

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That Offering or reno national banking association shall hereafter offer or receive United States notes or national bank notes as security or as collateral security for any loan of money, or for a con- hold same from

agreeing to withsideration shall agree to withhold the same from use, or

how punished. shall offer or receive the custody or promise of custody of such notes as security, or as collateral security, or consideration for any loan of money; and any national banking association offending against the provisions of this act shall be deemed guilty of a misdemeanor, and, upon conviction thereof in any United States court having jurisdiction shall be punished by a fine not exceeding one thousand dollars, and by a further sum equal to one-third of the money so loaned; and the officer or officers of said bank who shall inake such loan or loans shall be liable for a further sum equal to one-quarter of the money so loaned; and the prosecution of such offenders shall be commenced and conducted as provided for the punishment of offenses in an act to provide a national currency, approved June third, eighteen hundred and sixty-four, and the fine or penalty so recovered shall be for the benefit of the party bringing such suit.

Approved, February 19, 1869.

ACT OF MARCH 3, 1869, CHAPTER 130.

AN ACT REGULATING THE REPORTS OF NATIONAL BANKING ASSOCIATIONS.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That Banks to make in lieu of all reports required by section thirty-four of the not less than five national currency act, every association shall make to the

reports annually

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