The Bismarck tribune. [volume] (Bismarck, N.D.) 1916-current, 1921-02-03
CHANGES IN TAX.
LAW. ON. INCOMES.
IS RECOMMENDED.
Tax Commissioner George E.
Wallace Drafts Measure for
Legislative Committee
CORPORATION RATE UP
Would Increase 1t to 3 IL Per
Cent If Capital Stock Tax
Is Repealed

Important changes in the present
income tax law of the state are
brought forth in bill drawn by Tax
Commissioner George E. Wallace for
the consideration of the legislative
taxation committees, after he con-
ferred with them and a request was
made for such action. /.
The bill provides the recommenda-
tons made by the tax commissioner
in his annual report. Among the i'm
portant changes are:
Corporation income tax increas-
ed from to 8 IL percent but .
only in case capital stock tax act
is repealed.
Personal property. offset done
away with. g -4.>
Income from mortgages on real
estate mortgages secured on
North Dakota real property are
not exempted.
Interest upon obligations OF
political subdivisions as we'll as
state obligations exempted.
The North Dakota income tax law
differs from other income tax laws
in the United States in that it classi-
fies income as earned and unearncd
and imposes higher rate on unearn-
ed than on earned income. This dis
tinction is maintained in the proposed
new law. A sur-tax is imposed on
unearned income as follows:
10 Of the amount by which the net
unearned income exceeds $4,000, and
does not exceed $4,000
2% of the amount by,which the net
lnearned income exceeds $4,000, and
does not exceed $4,000.
3M OF the amount by which the net
unearned income exceeds $4,000, and
\ does not exceed $4,000. .-
y. 40 OF the amount by which the net
unearned income exceeds $4,000, and
does not exceed $4,000.
so of the amount by which the net
unearned income exceeds $4,000, ana
does not exceed $1,000.
go of the amount by which the net
unearned income exceeds $1,000, and
does not exceed $4,000.
10 of the amount by which the net
unearned income exceeds $1,000, and
does not exceed $4,000.
The rates on earned income are as
follows:
a. On the first $1,000 of taxable
income, or any part thereof, at the
rate of 20.
b. On the second $1,000 Of taxable
income, or any part thereof, at the
rate of 1k9c.
c. On the third $1,000 Of taxable
income, or any part thereof, at the
rate of 2%.
income, or any part thereof, at the
rate of 2k9e.
e. On the fifth $1,000 of taxable
income, or, any part thereof at the
rate of go.
f. On the sixth $1,000 of taxable
income, or any part thereof, at the
rate of 31A.H.
e. NOn the seventh $1,000 of taxa
BILE income. or any part thereof dt
the rate of 40.
h. On the eighth $1,000 Of taxable
income. or any part thereof at the
rate of 4k,R.
i. On the ninth $1,000 of taxable
income, or any part thereof, at the
rate of SO.
j. On the. tenth $1,000 of taxable
income, or any part thereof, at the
rate of 5k%.
k. On any amount Of taxable in
come in excess of $4,000, at the
rate of SO.
Rate Increase.
The rate upon corporations is in
creased from 3 to 3k%. This rate
was recommended by the tax commits
sioner only in case the capital stock
: tax law was repealed A bill has
been introduced to repeal the capital
stock tax law. The original income
tax law attempted to impose tax
on income of non-residents derived
from investments in North Dakota:
the new bill imposes tax only in
case of income received by non-resi-
dents from property located in the
state or business carried on in the
state and does not attempt to tax non
4 residents on income from any lOTH
of intangible property. The taxes
imposed by the proposed new law are
levied only upon income derived from
property located or business transact
ed in the state The proposed act
provides that income from personal
services and land contracts, mort
cages, stocks, bonds and securities
shall follow the residence of the re-
cipients.
Offset Is Removed.
The personal property affset has
been done away with. This does
away in part with the discrimination
of the present law in regard to cor
porations as compared with business
es of partnerships or individuals.
Dividends received by an individual
from corporation paying state in
come tax are exempt from taxation to
the individual or another corporation
receiving the same. Interest upon
obligations of the state or political
subdivisions of the state are exempt
ed. The income tax law at present
does not exempt interest upon obll-
Continued on page 81