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Tax on Income from Capital

Determination of Taxable Income. — This tax is imposed on:

It should be noted that this tax is levied exclusively upon the incomes enumerated and that interest on loans between private persons and income from foreign securities are not liable.

Since this tax is collected at the source, the recipient of taxable income does not need to make a return to the Treasury.

The rate of the tax is 5 per cent, and, owing to the method of collection, no question of abatement, deduction, etc., can arise.

Credits opened or advances granted by State, municipal or private banks on pledges in the form of securities or bills are liable to a special tax amounting per annum to 0.396 per cent of the sum advanced. The banks pay this tax in the course of the month following the closing of their accounts and may recover from the borrower.

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