Word: profitable
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Dates: during 1940-1949
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Capital's fear of the excess-profits tax now in the works (TIME, July 15) was thus partly assuaged. Also soothing was a second White House announcement: the Vinson-Trammell Act, which limits profits of ship and aircraft builders to 7 and 8% on Government contracts, would be repealed (Congress willing). Makers of war goods were thenceforth to be considered just as useful and profit-meriting people as any other manufacturers. For them, it was a forgotten but not a new sensation. In 1918 they were given special tax incentives; in the '20s they were shamed or starved...
...later reduced to 20 or 40%). This was in effect to treat all capital as though it bore the same risk, should earn the same return. But "invested capital," an artificial concept, was only one among many income-producing factors. Results were a tragicomedy of discrimination. Small, growing, high-profit companies found themselves in higher tax brackets than mature, stabilized giants. Corporations with little capital other than their wits (advertising agencies, etc.) paid at higher rates than overcapitalized railroads. Firms of the same size in the same line of business paid widely differing rates on the same amount of profits...
...undistributed profit...
...Australia might well fall within the Japanese sweep. Annual profit...
Last week Administration tax experts got down to the problem of sifting such problems. They intended, first of all, to make a distinction between a war-profits tax (on munitions-makers selling to the Government) and an excess-profits tax (on all corporations - as in 1918). The munitions-makers (aircraft and shipbuilders are already subject to a 10 or 12% profit limitation) may be treated more severely than the rest. On ordinary excess profits, the experts were looking for a formula to give corporations an incentive for ploughing their boom profits into new plant, thus multiplying defense production...