Arizona republican., 1917-12-05

occasioned much interst and throws much light upon this intricate subject. The paper follows:
 War Tax on Mining Companies.
 The War Tax Law was approved October 3, 1911; and the taxes provided for in the law are separate ard dis tlnct from existing taxes. The War Tax Law is to be levied, assessed, col lected and paid in the same manner as taxes imposel by the Income Tax Law of September s, 1916.
 In addition to the income tax of ? per cent, now assessed on net earnings of corporations under the act of Sep tember S.. 1916. the War Tax Law pro- vides for further tax of 1 per cent, making the total income tax on net earnings per cent.
 The War Excess Profit Tax is as sessed on the excess profits of corpo- rations, etc, and each corporation is deemed to be in but one trade or bus- mess, and all income is deemed to be 1 received from such trade or business. | The additional taxes provided for in the War Tax Law shall be assessed i for the calendar year 1917, and each year thereafter except in the case of a corporation having fixed its own fiscal year
 The determining of excess profits is | by deducting from the net income the sum of an amount equal to the same percentage of the invested capital for | the taxable year which the average amount of the annual net income of the business during the prewar pericd l was of the invested capital for the pre- war period and three thousand dollars | However, the deduction shall be an amount not less than per cent nor more than per cent of the invested capital for the taxable year.
 | A corporation that was not in ex- istence during the whole of any one l calendar year during the prewar per iod shall determine its excess profits by deducting from the net income per cent of the invested capital for thu taxable year, plus three thousand dol lars
 The Commissioner of Internal Rev enues, with the approval of the Sec retary of the Treasury, is authorized to make all necessary regulations fol the carrying out of the provisions oi the War Tax Law and may require the production of facts and data nec- essary for the collection of the tax.
 Application of the Law.
 In order to illustrate the working of the law, we will assume that a certain company, designated as Company A, | having a capital of 350,0O0 shares which had acquired it's property since March l. 1913, and had developed one million tons of ore at cost for prop erty and initial development of two and one-half million dollars, or at the rate of capital invested of $2.50 per dry ton, having earned for the year 1917 from the 13000 dry tons of ore smelt- ed, or production of 13,0oo,0 900 pound: copper, as follows:
 Operating ana Administrative
 Operating and Administrative
 Expense, not including tax
 eS ....-......-....-.. l,9Vo,oV' Gross earnings S2, 00O,0 ,0Ol
 Depletion .......... S5zo 900
 Depreciation ....... 35,OeO
 Total capital returned. ....s 360,0O' | Net earnings Sl,64O,OO' } Having determined the net income it is then necessary to determine tn
 capital invested. and therefore in or
 der that we may determine this WI
 will assume that Company A had al annual pre-war income in excess o
 per cent of its invested capital; ha' invested all of it's original cash ant property paid in as mine property ant