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Items subject to duty.
When to com mence.
REGULATIONS AND INSTRUCTIONS
IN RELATION TO PAYMENT OF DUTIES BY NATIONAL BANKS.
By the forty-first section of the act entitled "An act to provide a national currency, secured by a pledge of United States bonds and to provide for the redemption and circulation thereof," approved June 3, 1864, it is made the duty of the Treasurer of the United States to prescribe the form for making return, by each national banking association, of the average amount of its notes in circulation, the average amount of its deposits, and the average amount of its capital stock beyond the amount invested in United States bonds, for each half year from and after the first day of January, eighteen hundred and sixty-four. In compliance with this requirement, a form for such return has been prepared, and copies are furnished herewith.
Under the law, a return is to be made within ten days next succeeding the first days of January and July, in each and every year, for the preceding six months.
The penalty for default in making the return within the time fixed is two hundred dollars.
Items subject to duty.
The items made subject to duty by the act are circulating notes, deposits and capital stock.
Dates of commencement of liability to duty.
The return of these items from all banks that have before made returns of them will be for the full semi-annual term of 181, 182, or 184 days, as the case may be; and of all banks that have not before made returns of these items, as follows:
Upon circulating notes, from and including the date of their first issue.
Upon deposits, from and including the date of the first deposit received by the bank.
Upon capital stock, from and including the date of the certificate of the Comptroller of the Currency authorizing the commencement of business as a national bank.
Amount of each item subject to duty.
The amount of each item subject to duty is the average Amount. amount thereof for the half year for which duty is due.
Rule for ascertaining average amounts.
I. For banks making estimates from daily statements of balances.
Add together the daily balances of the item, from the Average amount, proper date of the commencement of the liability of the item how ascertained. to duty, (including for each Sunday and holiday the balance of the first preceding business day,) to and including the 30th day of June, or the 31st day of December, as the case may be. This aggregate of daily balances, for the first six months of any year, will be divided by 181, the number of days from January 1 to June 30, except in leap year, when the sum will be divided by 182. The aggregate of daily balances for the last six months of any year will be divided by 184, the number of days from July 1 to December 31.
II. For banks making estimates from weekly statements of balances.
Banks not making daily statements, and which obtain their averages from weekly statements, should add together the weekly balances, including for each day, in any fractional part of a week, one-seventh of the weekly balance next preceding such fractional part. The aggregate of balances for the first six months of any year will be divided by the number of weeks from January 1 to June 30, (25 6-7, or 26, as the case may be.) The aggregate of balances for the last six months will be divided by 26 2-7, the number of weeks from July 1 to December 31.
(Banks having items subject to duty for periods less than a half year, which make their estimates from daily balances, will divide the aggregate of the balances of each item, for the time for which it is liable to duty, by the number of days in the half year; and banks having like items, which make their estimates from weekly balances, by the number of weeks and fractions thereof in the half year.)
The quotients thus found will be the average amounts subject to duty for each six months respectively, and should be entered in the statement under the heading "Dutiable amount," and duty is to be computed thereon at the full semi-annual rate.
Duty on circulation.
The duty on circulating notes is one-half of one per centum Duty on circulaon the average amount outstanding for the six months.
On capital stock.
Liability on this item would commence on the first days of January and July in each and every year, unless a bank had at that time no circulation outstanding, in which case it would commence with the date of the first issue of notes, and terminate on the 30th day of June or the 31st day of December, (as the case may be,) date of commencement and termination both included.
Duty on deposits.
Under this head must be included the balances on hand, when the books of the bank are closed for the day, which are subject to payment on check or draft, or on return of certificate of deposit, (except deposits made to the credit of the Treasurer of the United States with a national bank depositary,) whether made by individuals, banks, savings banks, bankers, or by States, cities, or towns, whether certificates or certified checks have been issued therefor or not, and, in fact, all descriptions of deposits, except as above excepted, which may be used by the bank, or from which it may derive profits, including deposits upon which the bank pays interest, whether any part of either of such items are directly in the possession of the bank or in the hands of an agent or agents.
The average amount of deposits, including, in the case of a depositary, the average amount to the credit of the Treasurer of the United States from the first days of January and July, (or, in case the bank had not then commenced to receive deposits, from the date of the first deposit,) to the 30th of June, or the 31st of December, (as the case may be,) date of commencement and termination both included, will first be set down in the return. From this average amount, depositaries will be entitled to deduct the average amount on deposit to the credit of the Treasurer of the United States. Upon the remainder, which will be considered the deposits subject to duty, is to be levied a duty of one-fourth of one per centum semi-annually.
Duty on capital stock.
The capital stock on which duty is levied is held to be that portion of the paid-up capital stock which is in excess of the United States bonds owned by the bank. The average amount of the paid-up capital from the first days of January or of July (or, in case certificate of authority to commence business had not then been issued by the Comptroller of the Currency, from the date of such certificate) to the 30th day of June or the 31st day of December, date of
commencement and termination both included, will first be set down in the return. From this average amount deduction will be made of the average amount of United States bonds, at their face value, owned by the bank, including the bonds on deposit with the Treasurer of the United States as security for circulation, or for other purposes.
The rate of duty on capital stock is one-fourth of one per cent. semi-annually.
The actual capital paid in will be returned, without regard to the amount specially authorized. Thus, an institution should include in the capital liable to duty any increase which has been paid in, although such increase shall not at the date of the return have received the approval of the Comptroller of the Currency.
The term "United States bonds," as used in the act, is construed to mean only coupon or registered bonds, and not any portion of what is considered temporary debt, such as seven and three-tenths treasury notes, certificates of indebtedness, five per cent. notes, compound-interest notes, or temporary loan certificates.
Payment of duty.
The duty levied by the section referred to is required by Payment of duty law to be paid to the Treasurer of the United States in the months of January and July in each and every year, in default of which payment provision is made for its collection by the Treasurer out of the interest on securities in his hands, and may be made in any one of the following ways:
1st. By a deposit of the amount of duty to the credit of the Treasurer of the United States, with him, or with any Assistant Treasurer of the United States, or designated depositary, including all national banks, designated as such, and including the bank making payment, if a depositary. Triplicate certificates should be issued therefor, the original of which must be forwarded to the Secretary of the Treasury, the duplicate to the Treasurer, and the triplicate held by the party making the deposit, in which certificate it should be stated that the deposit is "on account of semi-annual duty."
Depositaries should be careful to distinguish the deposit on this account, as a duty from banks, so as not to confound it with deposits on account of internal-revenue tax, to which latter class it does not belong, and should make the certificate therefor in the name of the depositing bank, and not in the name of one of its officers.
2d. By remittance to this office of the amount of duty in lawful money of the United States, or the notes of national
banks; the expense and risk of transmission to be borne by the party remitting.
3d. By draft payable to the order of the Treasurer of the United States, on either of the cities of Washington, New York, Boston, or Philadelphia, to be made payable in the lawful money of the United States, or the notes of national banks.
Payment will not be considered in such cases as having been made until the drafts shall have been collected, and in no case until the semi-annual statement has been examined at this office.
When the draft is collected, certificates of payment of duty will be forwarded by the Treasurer to the bank.
National banks should be careful always to insert the name of the State in which they are located, and to address all correspondence relating to semi-annual duty to the Treasurer of the United States.