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APPENDIX A -- TABLES

Table I

Percentages by which Income Taxes payable upon Capital Gains are
less under the present Five-Step System than they would be if the
Realized Gains were Taxed on the "Accrual Basis", for Selected
Surtax Net Incomes /1/

Surtax net income              Number of years assets were held /2/
from other sources             1          2          5          10

                 A. Assuming net capital gains equal to
                  surtax net income from other sources

  5,000                      21.7       39.5       57.5        68.8
 10,000                      25.0       39.0       58.2        69.1
 20,000                      22.7       39.3       58.0        67.9
 50,000                      24.3       37.7       56.5        67.3
100,000                      20.3       39.7       60.0        70.0
500,000                      20.3       39.7       60.0        70.0

                 B. Assuming net capital gain of $50,000
                   for each selected surtax net income
                           from other sources

  5,000                      29.4       34.7       46.1        60.4
 10,000                      28.9       36.1       48.5        59.8
 20,000                      27.6       37.3       56.4        66.8
 50,000                      24.3       37.7       56.5        67.3
100,000                      20.0       40.0       60.0        70.0
500,000                      20.0       40.0       60.0        70.0

     Treasury Department, Division of Research and Statistics

                         FOOTNOTES TO TABLE

     /1/ For a description of the "accrual basis", see p. 14.

     /2/ Plus one day.

                          END OF FOOTNOTES

Table II

Gross Annual Investment Yields Required to Equal the Average Net
Returns after Federal Income Taxes of Gross Capital Gains Averaging
Five Percent per Annum, Compounded Annually, for Selected Cases

Selected Cases                       Years capital, assets held /1/
                                      10        5        2       1

1. Other surtax net income
   = $200,000;

   original investment
   = $1,000,000;

Average annual yield from capital
gains after Federal income taxes      4.1      3.7      3.0     2.4

Gross annual investment yield
required for equal return after
Federal income taxes                 12.8     11.5      9.2     7.1

2. Other surtax net income
   = $100,000;

   original investment
   = $500,000;

Average annual yield from capital
gains after Federal income taxes      4.2      3.8      3.2     2.5

Gross annual investment yield
required for equal return after
Federal income taxes                 11.1     10.1      8.3     6.5

3. Other surtax net income
   = $50,000;

   original investment
   = $250,000:

Average annual yield from capital
gains after Federal income taxes      4.4      4.2      3.9     3.5

Gross annual investment yield
required for equal return after
Federal income taxes                  7.2      8.9      6.3     5.7

4. Other surtax net income
   = $20,000;

   original investment
   = $100,000:

Avenge annual yield from capital
gains after Federal income taxes      4.7      4.6      4.4     4.2

Gross annual investment yield
required for equal return after
Federal income taxes                  5.9      5.8      5.5     5.3

5. Other surtax net income
   = $5,000;

   original investment
   = $25,000:

Average annual yield from capital
gains after Federal income taxes      4.9      4.8      4.8     4.7

Gross annual investment yield
required for equal return sifter
Federal income taxes                  5.3      5.3      5.2     5.1

     Treasury Department, Division of Research and Statistics

                          FOOTNOTE TO TABLE

     /1/ Plus one day.

                           END OF FOOTNOTE

Table III

Gross Annual Investment Yields Required to Equal the Average Net
Returns after Federal Income Taxes of Gross Capital Gains Averaging
Ten Percent per Annum, Compounded Annually, for Selected Cases

Selected Cases                       Years capital, assets held /1/
                                      10        5        2       1

1. Other surtax net income
   = $200,000;

   original investment
   = $1,000,000:

Average annual yield from capital
gains after Federal income taxes      8.5      7.6      8.1     4.7

Gross annual investment yield
required for equal return after
Federal income taxes                 27.7     24.6     19.2    14.5

2. Other surtax net income
   = $100,000;

   original investment
   = $500,000:

Average annual yield from capital
gains after Federal income taxes      8.6      7.8      6.4     5.0

Gross annual investment yield
required for equal return after
Federal income taxes                 23.5     21.2     17.1    13.4

3. Other surtax net income
   = $50,000;

   original investment
   = $250,000:

Average annual yield from capital
gains after Federal income taxes      8.8      8.2      7.5     6.8

Gross annual investment yield
required for equal return after
Federal income taxes                 16.4     15.1     13.4    12.0

4. Other surtax net income
   = $20,000;

   original investment
   = $100,000:

Average annual yield from capital
gains after Federal income taxes      9.4      9.2      8.7     8.3

Gross annual investment yield
required for equal, return after
Federal income taxes                 12.0     11.7     11.1    10.6

5. Other surtax net income
   = $5,000;

   original investment
   = $25,000:

Average annual yield from capital
gains after Federal income taxes      9.8      9.7      9.5     9.3

Gross annual investment yield
required for equal return after
Federal income taxes                 10.7     10.6     10.4    10.2

     Treasury Department, Division of Research and Statistics

                          FOOTNOTE TO TABLE

     /1/ Plus one day.

                           END OF FOOTNOTE

Table IV

Average annual rate of gross capital gains, compounded annually,
required to equal net yield after Federal income taxes from 3 1/2
percent taxable bond

Selected Cases                       Years capital, assets held /1/
                                      10        5        2       1

1. Other surtax net income
   = 200,000; bond investment
   = 1,000,000

   Bond yield after taxes             1.2      1.2      1.2     1.2

   Average annual capital gain
   required for equal return
   after Federal income taxes         1.5      1.6      2.0     2.5

2. Other surtax net income
   = 100,000; bond investment
   = 500,000

   Bond yield after taxes             1.3      1.3      1.3     1.3

   Average annual capital gain
   required for equal return
   after Federal income taxes         1.6      1.8      2.1     2.6

3. Other surtax net income
   = 50,000; bond investment
   = 250,000

   Bond yield after taxes             2.2      2.2      2.2     2.2

   Average annual capital gain
   required for equal return
   after Federal income taxes         2.5      2.6      2.8     3.1

4. Other surtax net income
   = 20,000; bond investment
   = 100,000

   Bond yield after taxes             2.8      2.8      2.8     2.8

   Average annual capital gain
   required for equal return
   after Federal income taxes         3.0      3.0      3.2     3.3

5. Other surtax net income
   = 5,000; bond investment
   = 25,000

   Bond yield after taxes             3.2      3.2      3.2     3.2

   Average annual capital gain
   required for equal return
   after Federal income taxes         3.3      3.3      3.4     3.4

     Treasury Department, Division of Research and Statistics

                          FOOTNOTE TO TABLE

     /1/ Plus one day.

                           END OF FOOTNOTE

Table V

Average annual rate of gross capital gains, compounded annually,
required to equal net yield after Federal income taxes from 3
percent fully tax-exempt bond

Selected Cases                      Years capital, assets held /1/
                                     10        5        2       1

1. Other surtax net income
   = 200,000; bond investment
   = 1,000,000

   Bond yield                        3.0      3.0      3.0      3.0

   Average annual capital gain
   required for equal return
   after Federal income taxes        3.7      4.0      4.9      6.4

2. Other surtax net income
   = 100,000; bond investment
   = 500,000

   Bond yield                        3.0      3.0      3.0      3.0

   Average annual capital gain
   required for equal return
   after Federal income taxes        3.6      3.9      4.7      6.0

3. Other surtax net income
   = 50,000; bond investment
   = 250,000

   Bond yield                        3.0      3.0      3.0      3.0

   Average annual capital gain
   required for equal return
   after Federal income taxes        3.4      3.5      3.8      4.2

4. Other surtax net income
   = 20,000; bond investment
   = 100,000

   Bond yield                        3.0      3.0      3.0      3.0

   Average annual capital gain
   required for equal return
   after Federal income taxes        3.2      3.3      3.4      3.6

5. Other surtax net income
   = 5,000; bond equivalent
   = 25,000

   Bond yield                        3.0      3.0      3.0      3.0

   Average annual capital gain
   required for equal return
   after Federal income taxes        3.1      3.1      3.2      3.2

     Treasury Department, Division of Research and Statistics

                          FOOTNOTE TO TABLE

     /1/ Plus one day.

                           END OF FOOTNOTE

Table VI

Profits and Losses from Sale of Assets as Reported in Individual
Returns Showing Net Income /1/

(In millions of dollars)

                              Profit from sale of assets
                                      Other than
                   Taxed as           taxed as
Taxable             capital            capital
year                net gain           net gain             Total

1922                  249.2              742.1               991.3
1923                  305.4              866.8             1,172.2
1924                  389.1             1,124.6            1,513.7
1925                  940.6             1,991.7            2,932.3
1926                  912.9             1,465.6            2,378.5
1927                1,081.2             1,813.4            2,894.6
1928                1,879.8             2,928.1            4,807.9
1929                2,346.7             2,337.9            4,684.6
1930                  556.4               636.7            1,193.1
1931                  169.9               301.7              471.6
1932                   50.1               112.8              162.9
1933                  133.6               419.6              553.2

                      Losses from sale of assets
                           Net loss from
                           sale of assets
                            other than
              Total         reported for                   Aggregate
             capital         tax credit                     profits
Taxable      net loss        on capital                      less
year            /2/           net loss         Total        losses

1922                             /3/
1923                             /3/
1924           72.0              /3/
1925           61.6              /3/
1926           34.4            178.2           212.6        2,165.9
1927           48.0            227.9           275.9        2,618.7
1928           40.8            171.7           212.5        4,595.4
1929           43.2            995.9         1,039.1        3,645.5
1930           80.8          1,232.8         1,313.6      -   120.5
1931          239.9          1,160.8         1,400.7      -   929.1
1932          832.4            375.4         1,207.8      - 1,044.9
1933          553.8            365.8           919.6      -   366.4

     Treasury Department, Division of Research and Statistics.

                          FOOTNOTES TO TABLE

     /1/ The comparability of the figures between years is effected
by (1) changes in individuals required to file returns; (2)
estimates for net incomes under $5,000; and (3) changes in the
statutory treatment of capital gains and losses, which are detailed
in Section III (pages 8, 9, 10 and 12).

     /2/ No figures for capital net losses are available for years
prior to the taxable year 1924. The figures shown for the years 1924
through 1930 were obtained through the capitalization of the 12 1/2
percent tax credit on capital net losses as reported in STATISTICS
OF INCOME; and are incomplete because the tax credit was computed
only on that amount of the taxpayers' capital net loss which was
necessary to offset his tax. The figures for the years 1931-1933 are
the actual capital net losses which were tabulated and reported in
STATISTICS OF INCOME.

     /3/ Not available

                           END OF FOOTNOTES

     Source of data: STATISTICS OF INCOME.

Table VII

Percentage of total net profits on sale of capital assets derived
from assets held for two years or less, or from assets held for
longer periods by persons subject to tax thereon of 12 1/2 percent
or less /1/

                          Net income classes
                  Under       50,000-       100,000    Aggregate --
Date           50,000 /2/     100,000       and over    all classes

1922              97.6         45.2           17.6         74.9
1923              97.4         33.4            6.9         73.9
1924              96.6         46.4           16.3         74.3
1925              98.2         58.0           24.3         67.9
1926              97.7         46.2           18.0         61.6
1927              97.7         51.1           24.2         62.6
1928              97.5         58.9           31.3         60.9
1929              98.4         49.1           15.9         49.9
1930              97.6         32.8            8.3         53.4
1931              98.4         33.7           11.0         64.0
1932              91.7         30.4           15.6         69.2
1933              95.3         67.6           29.8         75.9
1922-1933         97.6         50.9           21.3         62.1

     Treasury Department, Division of Research and Statistics

                         FOOTNOTES TO TABLE

     /1/ For factors effecting the comparability of the data from
year to year, see note 1 to Table VI.

     /2/ The percentages for the income class of less than $50,000
are not comparable with the percentages for the other groups,
because the former include a substantial part of the profits on sale
of assets held for more than two years, whereas the others do not.

                          END OF FOOTNOTES

     Source of data: STATISTICS OF INCOME.

Table VIII

Net Gains from Sale of Capital Assets in 1934 by Net Income Classes
and Statutory Periods that Assets Were Held /1/

(In thousands of dollars)

                 1 year
Net Income         and          1 - 2        2 - 5        5 - 10
classes           under         years        years        years

0  - 5            21,875        8,982        6,205        2,900
5  - 25           45,352       21,975        9,397        2,727
25 - 50           15,150        6,868        3,293          253
50 - 100           8,888        4,907          962        1,389
Over 100           6,772        4,143          138        2,077
Aggregate         98,067       46,875       19,995        9,346

Net income           Over 10            Not
classes               years            stated         Aggregate

0 - 5                13,577            2,870            56,409
5 - 25               28,830            4,178           112,489
25 - 50              15,499            1,548            42,611
50 - 100              9,558              971            26,675
Over 100             34,396            1,480            49,006
Aggregate           101,860           11,047           287,190

                    (Percentages of totals for each class)

                 1 year
Net Income         and          1 - 2        2 - 5        5 - 10
classes           under         years        years        years

0 - 5               38.8         15.9         11.0          5.1
5 - 25              40.4         19.5          8.4          2.4
25 - 50             35.6         16.1          7.7           .6
50 - 100            33.4         18.4          3.6          5.2
Over 100            13.8          8.5           .3          4.2
Aggregate           34.1         16.3          7.0          3.3

Net income           Over 10            Not
classes              years             stated         Aggregate

0 - 5                  24.1              5.1             100.0
5 - 25                 25.6              3.7             100.0
25 - 50                36.4              3.6             100.0
50 - 100               35.8              3.6             100.0
Over 100               70.2              3.0             100.0
Aggregate              35.5              3.9             100.0

     Treasury Department, Division of Research and Statistics

                          FOOTNOTE TO TABLE

     /1/ Excludes net capital gains of returns reporting net
deficits.

          Note: The change in treatment of capital gains and losses
     by the Revenue Act of 1934 makes the statistics on capital
     gains and losses for that year incomparable with those for
     prior years. In the first place, the capital gains realized by
     members of partnerships and beneficiaries of trusts and estates
     cease to be detailed in their individual returns; so that the
     data for capital gains realized by individuals in 1934 do not
     include the capital gains realized by partnerships and
     fiduciaries in which they held interests.

          In the second place, the abandonment of the special
     treatment of capital gains and losses from the sale of assets
     held for more than two years, and the substitution of the
     five-step system, results in the offsetting, in some cases, of
     gains realized from the sale of assets held two years or less,
     against losses from the sale of assets held more than two
     years, and vice versa. Previously, a net positive or negative
     balance was determined both for the capital gains and losses
     included in ordinary income and for the capital gains and
     losses subjected to the special treatment. Thus, where two
     separate net balances have been determined, only one net
     balance is available under the five-step system.

          Finally, the five-step system makes it possible for
     returns showing net capital gains, when 100 percent of their
     capital gains and losses are considered, to show net capital
     losses after application of the percentage brackets, and,
     similarly, returns showing aggregate net capital losses before
     application of the statutory percentages may show net capital
     gains after the percentages are applied. Hence, the statistics
     for 1934, wherein the net capital gains returns are separated
     from the net capital loss returns on the basis of the net
     balance existing after the operation of the statutory
     percentages, necessarily include certain amounts which would
     have formerly been excluded, and vice versa.

          The tabulations of the 1934 data were the result of a Work
     Relief Project sponsored by the Division of Research and
     Statistics, Treasury Department. Not all of the 1934 returns
     were included in the survey, however, inasmuch as certain
     returns were in the field or in Washington in the process of
     audit, et cetera. In general, the incompleteness was
     concentrated in the lower income classes where, because of the
     larger number of cases, it had the minimum effect upon the
     reliability of the figures. In addition to these differences
     from the Statistics of Income data, the source of the figures
     for the special tabulation was Schedule C (Statement of Capital
     Gains and Losses), whereas the Statistics of Income data were
     tabulated from the face of the return.

                           END OF FOOTNOTE

Table IX

Percentages whereby Capital Gains Taxes Payable under Improved
Step-Down Schedule would be Greater than those under Present
Schedule, for Selected Cases

Surtax Net Income        No. of Years Assets were Held /1/
From Other Sources    1            2           5            10

                  A. Assuming net capital gains equal
                to surtax net income from other sources

5,000                0.0         28.8         52.9         90.4
10,000               0.0         31.3         56.5         92.6
20,000               0.0         28.8         54.8         94.3
50,000               0.0         32.0         62.1        102.9
100,000              0.0         25.7         50.8         83.9
500,000              0.0         25.6         50.7         83.8

               B. Assuming net capital gain of $50,000
        for each selected surtax net income from other sources

5,000                0.0         38.9         82.7        149.7
10,000               0.0         36.6         72.0        125.1
20,000               0.0         35.1         63.9        104.9
50,000               0.0         32.0         62.1        102.9
100,000              0.0         25.0         50.0         83.3
500,000              0.0         25.0         50.0         83.3

     Treasury Department, Division of Research and Statistics

                          FOOTNOTE TO TABLE

     /1/ Plus one day.

          Note: The improved schedule would provide for the
     inclusion in net income of the following percentages of net
     capital gains and losses, according to number of years held:
     1-2 years, 80 percent; 2-3 years, 75 percent; 3-4 years, 70
     percent; 4-5 years 65 percent; 5-10 years, 60 percent; over 10
     years, 55 percent.

                           END OF FOOTNOTE

Table X

Percentages by which Income Taxes Payable upon Capital Gains would
be Less under Improved Step-Down Schedule /1/ than they would be if
the Realized Gains were Taxed on the "Accrual Basis" /2/ for
Selected Cases

Surtax Net Income           No. of Years Assets were Held /3/
From Other Sources       1       2       3       4       5      10

                    A. Assuming net capital gains equal
                 to surtax net income from other sources

5,000                  21.7    22.1    26.2    30.5    35.0    40.5
10,000                 25.0    19.9    23.7    29.0    34.5    40.5
20,000                 22.7    21.7    24.8    29.5    35.0    37.6
50,000                 24.3    17.8    19.1    23.3    29.5    33.6
100,000                20.3    24.2    29.4    34.5    39.7    44.8
500,000                20.3    24.3    29.5    34.6    39.7    44.9

                B. Assuming not capital gain of $50,000
      for each selected surtax not income from other sources

5,000                  29.4     9.3   - 1.1   - 3.1     1.5     1.2
10,000                 28.9    12.7     9.1     8.9    11.5     9.6
20,000                 27.6    15.2    16.9    21.9    28.6    32.0
50,000                 24.3    17.8    19.1    23.3    29.5    33.6
100,000                20.0    25.0    30.0    35.0    40.0    45.0
500,000                20.0    25.0    30.0    35.0    40.0    45.0

     Treasury Department, Division of Research and Statistics

                         FOOTNOTES TO TABLE

     /1/ The improved schedule would provide for the inclusion in
net income of the following percentages of not capital gains and
losses, according to number of years held: 1-2 years, 80 percent;
2-3 years, 75 percent; 3-4 years, 70 percent; 4-5 years, 65 percent;
5-10 years, 60 percent; over 10 years, 55 percent.

     /2/ For a description of the "accrual basis," see p. 14.

     /3/ Plus one day.

                          END OF FOOTNOTES

Table XI

Percentages by which Income Taxes Payable upon Capital Gains would
be greater under the "Accrual Basis." /1/ than under the Present
Five-Step System for Selected Surtax Net Incomes

Surtax Net Income          Number of Years Assets were Held /2/
From Other Sources       1            2            5           10

                    A. Assuming net capital gains equal
                 to surtax net income from other sources

5,000                  27.8         65.4         135.3        220.0
10,000                 33.3         63.9         139.1        223.5
20,000                 29.4         64.6         138.1        211.5
50,000                 32.1         60.5         129.9        205.4
100,000                25.5         65.8         150.0        233.3
500,000                25.4         65.9         150.0        233.3

                  B. Assuming net capital gain of $50,000
         for each selected surtax net income from other sources

5,000                  41.7         53.2          85.5        152.7
10,000                 40.7         56.5          34.3        148.9
20,000                 38.1         59.4         129.5        201.5
50,000                 32.1         60.5         129.9        205.4
100,000                25.0         66.7         150.0        233.3
500,000                25.0         66.7         150.0        233.3

     Treasury Department, Division of Research and Statistics

                         FOOTNOTES TO TABLE

     /1/ For a description of the "accrual basis," see p. 14.

     /2/ Plus one day.

                          END OF FOOTNOTES

Table XII

Book Value and Closing Market Prices of the Fifteen Most Active
Stocks on the New York Stock Exchange on December 31, 1936 (Listed
in order of activity)

                                        Book value     Market price
                                         per share       per share

Ohio Oil Company                          $11.86          $17-3/4
General Motors Corporation                 18.46           63-1/2
Paramount Pictures, Inc.                   11.23           24-1/2
Socony Vacuum Oil Company, Inc.            19.98           16-7/8
Consolidated Oil Corporation               17.86           16-7/8
Columbia Gas and Electric Corporation      17.36           18-3/8
Pure Oil Company                           22.60           20-7/8
Radio Corporation of America                3.10           11-1/2
United Air Lines Transport Corporation      8.48           22
United States Steel Corporation           138.37           78
Warner Bros. Pictures, Inc.                22.69           17-3/4
Pierce Petroleum Corporation                7.55            3-1/2
Commonwealth and Southern Corporation       5.27            3-3/8
Consolidated Textile Corporation            1.14              7/8
Anaconda Copper Mining Company             55.88           53-1/2

Source: Moody's Investment Service.

Table XIII

Comparison of changes in market and book values of common stocks of
railroad equipment and iron and steel companies, 1932-1936 /1/

Company                                 Book value per share

                                Dec. 31,      Dec. 31,      Percent
                                  1932          1936         change

Railroad Equipment

American Brake Shoe and          $27.67        $27.98          +1.1
Foundry Company

American Car and Foundry          99.88         90.10          -9.8
Company /2/

American Locomotive Company       68.80         20.91         -69.6

American Steel Foundries          42.11         38.10          -9.5

Baldwin Locomotive Works          40.55         13.78         -66.0

General American                  64.82         62.64          -3.4
Transportation Corporation

General Railway                   32.91         29.55         -10.2
Signal Company

Pullman, Inc.                     69.58         60.72         -12.7

Union Tank Car Company            30.26         29.65          -2.0

Westinghouse Air                  17.65         14.43         -18.2
Brake Company

Steel and Iron

American Rolling                  30.84         31.74          +2.9
Mill Company

Bethlehem Steel Corporation      126.60        113.02         -10.7

Byers (A. M.) Company             56.43         44.06         -21.9

Colorado Fuel and                 38.77         32.63         -15.8
Iron Corporation

Crucible Steel Company           150.56        160.80          +6.8
of America

Inland Steel Company              49.28         53.27          +8.1

National Steel Corporation        47.41         50.97          +7.5

U.S. Pipe and Foundry             37.38         37.17           -.6
Company

U.S. Steel Corporation           168.84        129.03         -23.6

Youngstown Sheet and              91.53         76.66         -16.2
Tube Company

Republic Steel Corporation        68.47         38.53         -43.7

Company                                Market value per share

                                Dec. 31,      Dec. 31,      Percent
                                  1932          1936         change

Railroad Equipment

American Brake Shoe and           $9.63        $69.00        +616.5
Foundry Company

American Car and Foundry           7.00         59.25        +746.4
Company /2/

American Locomotive Company        5.88         45.75        +678.1

American Steel Foundries           5.63         61.88        +999.1

Baldwin Locomotive Works           4.50          9.50        +111.1

General American                  17.00         73.38        +331.6
Transportation Corporation

General Railway                   13.25         56.50        +326.4
Signal Company

Pullman, Inc.                     18.88         68.50        +262.8

Union Tank Car Company            12.00         26.75        +122.9

Westinghouse Air                  11.25         50.00        +344.4
Brake Company

Steel and Iron

American Rolling                   8.00         34.75        +334.4
Mill Company

Bethlehem Steel Corporation       14.75         75.50        +411.9

Byers (A. M.) Company             13.25         28.25        +113.2

Colorado Fuel and                  4.50         45.63        +914.0
Iron Corporation

Crucible Steel Company            20.00         53.63        +168.2
of America

Inland Steel Company              12.75        117.50        +821.6

National Steel Corporation        20.00         71.50        +257.5

U.S. Pipe and Foundry              9.50         63.00        +563.2
Company

U.S. Steel Corporation            27.50         78.00        +183.6

Youngstown Sheet and               9.88         78.00        +689.5
Tube Company

Republic Steel Corporation         5.50         28.75        +422.7

                         FOOTNOTES TO TABLE

     /1/ All railroad equipment and iron and steel companies
included in Standard Statistics Co. averages.

     /2/ 1932 figures for year ended April 30, 1933; 1936 figures
for year ended April 30, 1936.

                          END OF FOOTNOTES

Table XIV

Percentages by Which Present Capital Gains Taxes would be Reduced or
Increased By Subjecting Capital Gains to Normal Tax Plus one-half of
Surtax Rates, in Lieu of Present Step-Down Provisions, for Selected
Cases

Surtax net income          Number of years assets were held /1/
from other sources        1           2           5            10

                 A. Assuming net capital gains equal
               to surtax net income from other sources

       5,000           -  8.3      + 26.9       + 94.1      + 164.0
      10,000           - 13.7      + 22.2       + 91.3      + 158.8
      20,000           - 24.2      +  5.0       + 62.5      + 123.8
      50,000           - 28.5      +  1.9       + 65.2      + 129.5
     100,000           - 33.3      - 10.4       + 35.1      +  80.1
     500,000           - 33.9      - 11.4       + 33.4      +  77.9

               B. Assuming net capital gain of $50,000
       for each selected surtax net income from other sources

       5,000           - 16.5      + 27.8      + 133.4      + 262.9
      10,000           - 18.6      + 21.8      + 109.4      + 209.3
      20,000           - 22.1      + 15.2      +  88.8      + 162.7
      50,000           - 28.5      +  1.9      +  65.2      + 129.5
     100,000           - 33.5      - 11.3      +  33.1      +  77.4
     500,000           - 34.1      - 12.2      +  31.8      +  75.7

                          FOOTNOTE TO TABLE

     /1/ Plus one day.

                           END OF FOOTNOTE

Table XV

Percentages by which Capital Gains Taxes would be Smaller or Greater
if Capital Gains were subjected to Normal Tax Plus One-half of
Surtax Rates than they would be under the "Accrual Basis" /1/ for
Selected Cases

Surtax Net Income          Number of years assets were held /2/
From Other Sources        1           2           5            10

                    A. Assuming net capital gains equal
                 to surtax net income from other sources

       5,000           - 28.3      - 23.3       - 17.5       - 17.5
      10,000           - 35.3      - 25.4       - 20.0       - 20.0
      20,000           - 41.4      - 36.2       - 31.8       - 28.2
      50,000           - 45.9      - 36.5       - 28.1       - 24.9
     100,000           - 46.8      - 46.0       - 46.0       - 46.0
     500,000           - 47.3      - 46.6       - 46.6       - 46.6

               B. Assuming net capital gain of $50,000
       for each selected surtax net income from other sources

       5,000           - 41.1      - 16.6       + 25.8       + 43.6
      10,000           - 42.1      - 22.2       +  7.8       + 24.2
      20,000           - 43.6      - 27.8       - 17.8       - 12.9
      50,000           - 45.9      - 36.5       - 28.1       - 24.9
     100,000           - 46.8      - 46.8       - 46.8       - 46.8
     500,000           - 47.3      - 47.3       - 47.3       - 47.3

                         FOOTNOTES TO TABLE

     /1/ For a description of "accrual basis", see page 14.

     /2/ Plus one day.

                          END OF FOOTNOTES
 
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