ppfg^F|^:^Jx|pff:^-^^^^;-.•^^;; 
 
 A 
 
 
 
 
 ; cz 
 
 ; o 
 
 18
 
 UNIVERSITY 
 
 OF CALIFORNIA 
 
 LOS ANGELES 
 
 SCHOOL OF LAW 
 LIBRARY
 
 SUPPLEMENT TO TREASURY DECISIONS 
 
 (T. D. 2834) 
 
 TREASURY DEPARTMENT 
 
 UNITED STATES INTERNAL REVENUE 
 
 REGULATIONS No. 49 
 
 REGULATIONS 
 
 Promulgated by the 
 
 COMMISSIONER OF INTERNAL REVENUE 
 
 With the Approval o' the 
 SECRETARY OF THE TREASURY 
 
 Relating to the 
 
 COLLECTION OF TAX 
 TRANSPORTATION AN 
 OTHER FACILITIES 
 
 Title V, Sections 500, 501, and 
 502 OF THE Revenue Act of 1918 
 
 WASHINGTON 
 
 GOVERNMENT PRINTING OFFICE 
 
 1919
 
 s 
 
 So 
 
 1919
 
 > 
 
 « 
 
 
 REGULATIONS RELATING TO THE 
 
 TRANSPORTATION TAX 
 
 Under Title V of the Revenue Act of 1918. 
 
 (Public, No. 254, Sixty-fifth Congress. H. R. 12SG3.) 
 
 CONTENTS. 
 
 PART I. 
 
 DEFINITIONS. 
 
 Section 500. Imposition of tax. 
 
 Page. 
 
 Article 1. Carrier 7 
 
 2. Transportation 7 
 
 3. Terms 7 
 
 4. General rule 8 
 
 5. Tax less than half cent disregarded 8 
 
 PART II. 
 TRANSPORTATION OF PROPERTY BY FREIGHT. 
 
 Section 500 (a). Tax on freight charges. 
 
 Article 6. Tax under revenue act of 191S 9 
 
 7. Transportation completed prior to Nov. 1, 1917 9 
 
 8. Service in respect of which tax is assessed 9 
 
 9. Total amount of charges taxable 9 
 
 10. No duplication of tax 10 
 
 11. Towage charges 10 
 
 12. Carrier shall collect, return, and remit total taxes on all 
 
 charges collected 10 
 
 13. Taxable charges — In-transit privileges 10 
 
 14. Taxable charges 11 
 
 15. Charges on property shipped for export and actually ex- 
 
 ported exempt from tax 11 
 
 16. Shipments to Porto Rico, Philippine Islands, Virgin 
 
 Islands, and the Canal Zone 12 
 
 17. Property imported 12 
 
 18. Import shipments from adjacent foreign countries 12 
 
 19. Property passing through the United States 12 
 
 20. Charges on such property taxable 13 
 
 Section 501 (c). Commodities transported without collection of a charge. 
 
 Article 21. Carrier 13 
 
 22. Basis of computation of tax 13 
 
 23. Effect of foregoing provision 14 
 
 24. Stock of one curporutiyu owned by another 14 
 
 8
 
 4 CONTENTS. 
 
 Section 501 (c)— Continued. Pa^g 
 
 Article 25. Application of tax 14 
 
 26. Federal- control 15 
 
 27. Circus trains 15 
 
 28. jMilk, newspapers, and other commodities 16 
 
 29. State inspection charges 16 
 
 30. Storage charges 16 
 
 31. Blocking and staking charges 16 
 
 32. Property sold 10 
 
 33. Chartered boats — 16 
 
 34. Combined freight and express service or facilities 16 
 
 85. Transportation by mechanical motor power when in com- 
 petition with carriers by rail or water of property by 
 
 freight 17 
 
 PART III. 
 
 TRANSPORTATION OF PACKAGES, PARCELS, OR SHIPMENTS BY 
 
 EXPRESS. 
 
 Section 500 (b). Tax on freight by rail or water. 
 
 Article 3G. Application of tax 18 
 
 37. Application of tax 18 
 
 PART IV. 
 
 TRANSPORTATION OF PERSONS. 
 
 Section 500 (c). Tax on transportation of persons. 
 
 Article 38. Application of tax 19 
 
 39. Regular established line 19 
 
 40. Round-trip ticket 20 
 
 41. Commutation and season tickets 20 
 
 42. Zone system 20 
 
 43. Combination fares 20 
 
 44. Tickets bought and wholly or partially unused prior to 
 
 Nov. 1, 1917 20 
 
 45. Manner of evidencing payment of tax on such tickets 20 
 
 46. Special provisions relating to such tickets 20 
 
 47. Partially used mileage books paid for before Nov. 1, 1917 — 21 
 
 48. Provisions I'elating to such books 21 
 
 49. Mileage books purchased in the United States 21 
 
 1)0. Mileage books purchased in Canada or Mexico 21 
 
 51. Cash fare.s 22 
 
 52. Party tickets 22 
 
 53. Prepaid orders 22 
 
 54. Exchange orders 22 
 
 65. Steamship orders 22 
 
 66. Excess baggage - 23 
 
 57. Storage of baggage 23 
 
 58. Computation of tax 23 
 
 59. Corpses 23 
 
 60. Extra fares for special services or facilities 23 
 
 61. Chartered cars or trains ^ 23 
 
 62. Cases in which tax does not apply 23
 
 CONTEISTTS. 6 
 
 Section 500 (d). Tax on amounts paid for accommodations in parlor or 
 
 sleeping cars or on vessels. 
 
 Pago. 
 
 Article 63. Accommodations to which tax applies 1^4 
 
 64. Accommodations to which tax does not apply 25 
 
 65. Duties of agents, collecting charges on behalf of carriers 
 
 furnishing such accommodations 25 
 
 PART V. 
 
 TRANSPORTATION OF OIL BY PIPE LINE. 
 
 Section 500 (e). Tax on transportation of oil by pipe line. 
 
 Article GG. Definition of oil 26 
 
 67. Miscellaneous provisions 26 
 
 PART VI. 
 
 GOVERNMENTAL EXEMPTION. 
 
 Section 500 (h). Governmental exemption. 
 
 Article 68. Nature of exemption 27 
 
 69. Foreign governments 27 
 
 70. Government agencies 27 
 
 71. Evidences of right to exemption 27 
 
 72. Evidences of right to exemption 28 
 
 73. Ambassadors, ministers, and diplomatic representatives — 30 
 
 74. Cost-plus contracts 31 
 
 75. Credentials 31 
 
 76. Forms to be furnished 32 
 
 77. Lump-sum Government contracts 82 
 
 78. Exemption — Persons 32 
 
 79. Certificate required when charges paid 32 
 
 SO. Prepaid charges 82 
 
 81. Indorsement of certificates 33 
 
 82. Separate certificates 33 
 
 83. Carriers to record and file certificates 33 
 
 PAPtT VII. 
 
 PAYMENT, COLLECTIONS, AND RETURN PENALTIES. 
 
 Section 501 (a). Payment, collection, reporting, returning, and remit- 
 tance of the taxes — ^Penalties. 
 
 Article 84. Payment of taxes 34 
 
 85. Collection of taxes 34 
 
 86. Credit arrangements 34 
 
 87. Records — Taxes collected 34 
 
 88. Records — No taxes collected 34 
 
 89. Records — Adjustment of taxes 35 
 
 90. Records — Summaries of transactions 35 
 
 91. Return and remittance of taxes 35 
 
 92. Penalties 36
 
 REGULATIONS RELATING TO THE COLLECTION OF TAX ON TRANS- 
 PORTATION AND OTHER FACILITIES. 
 
 PART I. 
 GENERAL DEFINITIONS. 
 
 LAW AND REGULATIONS RELATING TO TRANSPORTATION 
 
 TAXES. 
 
 The revenue act of 1918, Title V, section 500, provides: 
 
 That from and after April 1, 1919, there shall be levied, assessed, collected, 
 and paid, in lieu of the taxes imposed by section 500 of the revenue act of 
 1917   * *. 
 
 Article 1. Carrier. — The word " carrier," as used in Title V of the 
 revenue act of 1918, is held to mean any person, corporation, partner- 
 ship, or association who or which, for hire, furnishes any of the 
 transportation services or facilities described or referred to in sub- 
 divisions (a), (b), (c), (d), and (e) of section 500 of the act. 
 
 Art. 2. Transjwrtatlon.—lliQ, word " transportation," as used in 
 Title V of the act, means the movement of persons and property by 
 a carrier, including all services and facilities rendered, furnished, or 
 used in connection with such movement by or on behalf of a carrier. 
 It includes receipt, delivery, elevation, transfer in transit, ventila- 
 tion, refrigeration, icing, storage, demurrage, towage, lighterage, 
 trimming of cargo in vessels, wharfage, handling of property trans- 
 ported, feeding and watering live stock, and all other incidental serv- 
 ices and facilities. It does not include cartage or passengers' meals 
 or hotel accommodations. 
 
 Art. 3. Terms. — The term " United States," as used in Title V of 
 the act, means only the States, Alaska, Hawaii, and the District of 
 Columbia, 
 
 The term " person," as used in the act and in these regulations, 
 includes individuals, partnerships, corporations, and associations. 
 
 The term " Secretary," as used in the act and in these regulations, 
 means the Secretary of the Treasury. 
 
 The term " Commissioner," as used in the act and in these regu- 
 lations, means the Commissioner of Internal Revenue. 
 
 The term " collector," as used in the act and in these regulations, 
 means the collector of internal revenue. 
 
 7
 
 8 TAX ON TKANSPOKTATION AND OTHER FACILITIES. 
 
 CHARGES TAXABLE. 
 
 Art. 4. General rule. — The charges in respect of which the taxes 
 under subdivisions (a), (b), (c), (d), and (e) of section 500 must 
 be assessed are all charges for transportation, as above defined, col- 
 lected under tariffs filed or concurred in by the carrier making the 
 charges, with a Federal or State regulating authority, provided, 
 hoAvever, that if a carrier has not filed or concurred in such tariffs 
 all charges collected by such carrier for transportation, as above 
 defined, are taxable. 
 
 Art. 5. 7'ax less than half cen.t disregarded. — ^In computing the 
 amount of tax to be paid under the provisions of section 500, a 
 fractional part of a cent shall be disregarded, unless it amounts to 
 one-half cent or more, in which case it shall be increased to one 
 (1) cent. No tax shall apply to any payment for freight trans- 
 portation in the sum of sixteen (16) cents or less.
 
 PART II. 
 TRANSPORTATION OF PROPERTY BY FREIGHT. 
 
 Section 500, subdivision (a), of the act imposes — 
 
 A tax equivalent to three per centum of the amount paid for the transporta- 
 tion by rail or water or by any form of mechanical motor power when in com- 
 petition with carriers by rail or water of property by freight transported from 
 one point in the United States to another ; and a like tax on the amount paid 
 for such transportation within the United States of property transported from 
 a point without the United States to a point within the United States. 
 
 ^ -^-v EFFECTIVE DATE OF THE LAW. \\<s 
 
 Art. 6. Tax under revenue act of 1918. — The tax under the revenue 
 act of 1918 is in lieu of the tax under section 500 of the revenue act 
 of 1917, and in the the case of the transportation of i)roperty by 
 freight the rate of taxation is the same under both acts. Tlie pro- 
 visions of the revenue act of 1917 are effective as to all taxable 
 services or facilities furnished between midnight of October 31, 
 1917, and midnight of iMarch 31, 1919 ; the provisions of the revenue 
 act of 1918 do not apply to services or facilities furnished prior to 
 midnight of March 31, 1919, but do apply to such services or facili- 
 ties furnished subsequent to midnight of March 31, 1919. 
 
 Art. 7. Transportation completed prior to Noveniber i, 1017. — The 
 tax under the revenue act of 1917 became effective November 1, 1917, 
 and accordingly where transportation services are completed prior to 
 that date no tax would be due under either of the acts, even though 
 the transportation charges covering such services are paid at any time 
 after November 1, 1917. 
 
 SERVICES AND FACILITIES TAXABLE. 
 
 Art. 8. Service in respect of which tax is assessed. — The tax im- 
 posed under section 500 of the act on the amount paid for the trans- 
 portation of property by freight is held to apply to each and every 
 service and facility rendered by or on behalf of carriers in connection 
 "with transportation, as herein defined, of property by freight from 
 one point in the United States to another. 
 
 Art. 9. Total amount of charges taxable. — Where any taxable 
 charge, as defined in these regulations, is collected in addition to the 
 
 114310°— 19 2 9
 
 10 TAX ON TRANSPORTATION AND OTHER FACILITIES. 
 
 road haul, water luuil, or road-and-water haul charge, the tax shall 
 apply ou the total auiouut collected by the carrier, consisting of tlio 
 road haul, water, or road-and-water haul charge plus all taxable 
 charges collected in addition thereto. 
 
 Art. 10. No duplication of tax. — If any taxable charge, as defined 
 in these regulations, be included in the road haul, water haul, or 
 road-and-water haul charge applying to any shipment, the tax ap- 
 plies to and shall be collected on the total amount collected, and no 
 separate or additional tax shall be collected on the taxable amounts 
 included therein. 
 
 When an express company furnishes express transportation over 
 transportation facilities of another carrier, the amounts paid by the 
 express company to such carrier for use of the transportation facili- 
 ties are not subject to tax. The tax is imposed only upon the amounts 
 paid by the consignor or consignee of the express shipments. 
 
 Art. 11. Toioage charges. — Towage, if a part of transportation, 
 is subject to tax. If, however, towage is performed for a carrier and 
 paid for by the carrier as a part of its operating expense, the charge 
 is not taxable. If it is performed for a shipper either direct or as an 
 agent of the carrier and the shipper is charged for the services, the 
 amount paid therefor is taxable. 
 
 Art. 12. Carrier shall collect^ return, and remit total taxes on all 
 charges collected. — Whenever one carrier collects the charge or 
 charges for freight transportation performed in part by or on behalf 
 of another carrier or carriers, such carrier shall collect the tax appli- 
 cable to such taxable charge or charges and return and remit to the 
 proper collector of internal revenue the total tax collected. 
 
 Art. 13. Taxable charges — In-transit privileges. — In the collection 
 of taxable charges in connection with in-transit privileges, it is the 
 practice of some carriers to collect the local rate to the transit point 
 and upon reshipment to refund such local rate, and then assess the 
 through rate from point of origin to final destination, while it is the 
 practice of other carriers in the collection of such charges to collect 
 the local rate to the transit point and at the time of reshipment 
 from the transit point to assess the balance of the through rate. 
 Various other adjustments of charges are common in connection with 
 the in-transit privileges. As a general rule, to govern the collection 
 of taxes in all such cases, it is held that the tax must be collected on 
 the charges to the transit point at the time such charges are col- 
 lected, and that whatever basis of readjusting the charges is used 
 at the time of reshipment or at destination, such tax must be collected 
 by the carrier adjusting the charges as remains due upon the net tax- 
 able charges assessed on the shipment from point of origin to destina- 
 tion, including the charges for the in-transit privileges.
 
 TAX OIT TRA1TSP0RTATI02T AlTD OTHER FACILITIES. ll; 
 
 [A.RT. 14. Taxable charges — Terminal or water service. — ^Whenever 
 a taxable charge, in connection with a terminal or water service, is 
 paid by one carrier, acting for the consignor or consignee, to another 
 carrier, the tax applicable shall be paid by the former carrier to the 
 latter carrier, who shall return and remit the same as required here- 
 under. 
 
 PROPERTY EXPORTED. 
 
 Aet. 15. Charges on 'property shipped for export and actuoUy 
 exported exempt from tax. — Amounts paid for the transportation of 
 property in the course of exportation to foreign ports or places are 
 held to be exempt from the tax imposed under section 500 of the act. 
 Property may be deemed to be in the course of exportation when it 
 moves under any of the following conditions : 
 
 (a) Under a through export bill of lading. 
 
 (5) Under a domestic bill of lading or receipt on which, at point 
 of origin, " For export " is marked or the foreign consignee and 
 destination are specified (this clause does not apply to shipments to 
 Canada or Mexico. See paragraph (<?)). 
 
 ((?) Under a through bill of lading or through live-stock contract 
 to a place in Canada or Mexico. 
 
 (<Z) Under a domestic bill of lading or receipt marked at point of 
 origin " For export," wherein the Food Administration Grain Cor- 
 poration, Director of Overseas Transportation, British Admiralty, 
 or any export representative of the United States or of a foreign 
 Government, approved by the Commissioner of Internal Eevenue, is 
 named as consignee. 
 
 Provided that in either case (rt) or (5) the property so consigned 
 be delivered to a vessel clearing to a foreign port or place and a 
 ship's receipt is taken therefor, or, in case (c), the property so con- 
 signed be delivered at a place in Canada or Mexico, or, in case (fZ), 
 the property so consigned be delivered to such consignee. 
 
 If, when property is delivered to a carrier for transportation, it 
 clearly appears that such goods are in the course of exportation, as 
 provided in clause (a), (6), (c), or (r/), no tax shall be collected on 
 the amounts of any otherAvise taxable charges prepaid upon such 
 property; but, unless such property is delivered in such manner 
 as is specified in the proviso to such clause, the total transportation 
 charges on such property, from the point of origin to destination in 
 the United States, are subject to the tax, and such tax must be col- 
 lected as and when the transportation charges thereon are collected, 
 if the transportation charges be billed collect, or, upon delivery of the 
 consignment, if the trans^^ortation charges, or any of them, be i)re- 
 paid.
 
 Igi. TAX ON TRANSPORTATION AND OTHER FACILITIES. 
 
 Art. 1G. Shipments to Porto Rico, Philippine Islands, Virgin 
 IsJmids, and the Canal Zone. — Shipments to Porto Rico, the Phil- 
 ippine Islands, the Virgin Islands, and the Canal Zone arc not ex- 
 port shipments. But the rail transpoi-tation from an interior point 
 of the United States to a port for transshipment to Porto Rico, the 
 Philippine Islands, and the Virgin Islands is exempt from tax by 
 reason of specific acts of Congress. Property will be deemed to be in. 
 the course of transportation to these localities only when shipped 
 under the conditions described in article 15. Transportation of ship- 
 ments destined to the Canal Zone is not exempt. 
 
 PROPERTY IMPORTED; PROPERTY PASSING THROUGH THE 
 
 UNITED STATES. 
 
 Art, 17. Profcrty imported. — In the case of property, whether 
 moving on a through or foreign bill of lading or otherwise, imported 
 into the United States, the tax imposed under section 500 of the act 
 applies to the transportation charges wdiich accrue thereon from 
 point or place of entry to destination within the United States. 
 
 The tax due under the preceding paragraph shall be collected as 
 and when the transportation charges thereon are collected if such 
 charges be collected within the United States. If such charges be 
 prepaid outside the United States, and not paid at point or place of 
 entr}^, such tax shall be collected upon delivery of the shipment. 
 
 Art. 18. Import ship7nents from adjacent foreign countries. — 
 When import shipments from adjacent foreign countries move on 
 through rates, and there are no established divisions, the charges 
 shall be prorated on a mileage basis, and the transportation tax shall 
 be paid and collected upon that proportion of the amount paid 
 which the mileage within the United States bears to the mileage of 
 the shipment transported. Wlien there are established divisions, the 
 transportation tax shall be paid and collected upon the division 
 accruing for the transportation from the border point, if the divi- 
 sions are based on the border, to destination within the United States. 
 If divisions are not based on the border, then the tax shall be paid 
 and collected upon the division from the basing point nearest the 
 border to destination, plus or minus an amount computed on the 
 mileage from such basing point to border. 
 
 Art. 19. Property passing through the United States. — In the 
 case of property passing through the United States from one for- 
 eign port or place to another the tax does not apply. If, however, 
 property, while so passing through the United States, be reconsigned 
 to a destination within the United States, the tax applies to the trans- 
 portation charges thereon from the point or place of entry to such 
 destination within the United States.
 
 TAX ON TEANSPOKTATIOI!? AND OTHER FACILIOfilKS,. 13 
 
 DOMESTIC SHIPMENT PASSING THROUGH A FOREIGN COUNTRY 
 
 EN ROUTE. 
 
 Art. 20. Charges on such property taxable. — If a shipment hav- 
 ing both origin and destination v^ithin the United States passes out 
 of the United States on its journey, the gross transportation charges 
 from point of origin to final destination are nevertheless subject to 
 the tax. 
 
 COMMODITIES TRANSPORTED WITHOUT COLLECTION OF A 
 
 CHARGE. 
 
 Section 501, subdivision (c), of the act provides: 
 
 The taxes imposed by section 500 sliall apply to all services or facilities speci- 
 fied in sucti section wlien rendered for liire, whether or not the agency ren- 
 dering tliem is a common carrier. In case a carrier (other tlian a pipe line) 
 principally engaged in rendering transportation services or facilities for hire 
 does not, because of its ownership of tlie goods transported, or for any other 
 reason, receive tlie amount which as a carrier it would otherwise charge, such 
 carrier shall pay a tax equivalent to the tax which would be imposed upon the 
 transportation of such goods if the carrier received payment for sucli trans- 
 portation ; such tax, if it can not be computed from actual rates or tariffs of 
 the carrier, to be computed on the basis of the rates or tariffs of other 
 carrier for like services as determined by the Commissioner. In the case 
 of any carrier (other than a pipe line) the principal business of which 
 is to transport goods belonging to it on its own account and which only inci- 
 dentally renders services for hire, the tax shall apply to such services or facili- 
 ties only as are actually rendered by it for hire. 
 
 Art. 21. Carrier. — Where a carrier (other than a pipe line) is en- 
 gaged principally in the business of transporting goods belonging to 
 it on its own account and only incidentally renders services for hire, 
 the tax will appl}^ only to such services as are actually rendered for 
 hire. However, in case a carrier (other than a pipe line) is prin- 
 cipally engaged in rendering transportation services or facilities for 
 hire and does not, because of its ownership of the goods transported, 
 or for any other reasons, receive the amount which as a carrier it 
 would otherwise receive, such carriers will pay the tax that would be 
 imposed upon the transportation if the carrier received payment 
 therefor. 
 
 The tax applies to the transportation by a carrier of property be- 
 longing to or for the personal use of any of its officers, agents, or 
 employees, even though such property be transported free of charge. 
 
 Art. 22. Basis of comjjutation of tax. — In the cases falling within 
 the above-quoted provision of section 501, the basis of the computa- 
 tion of the tax shall be upon the legal rates or tariffs of the carrier 
 and, in the absence thereof, the actual rates or tariffs of other carriers 
 for like service. If the basis of the tax can not be readily deter-
 
 14 TAX ON TRANSPORTATION AND OTHER FACILITIES. 
 
 mined in the manner stated, the facts should be forthwith reported 
 by the carrier to the Commissioner of Internal Revenue for deter- 
 mination by him of the basis of computation. 
 
 TRANSPORTATION OF COMMODITIES FOR USE OF CARRIER AS 
 
 A CARRIER. 
 
 Section 501, subdivision (c), of the act provides: 
 
 Nothing in this or the preceding section shall bo construed as imposing a 
 tax (1) upon the transportation of any commodity which is necessary for 
 the use of the carrier in the conduct of its business as such, and is intended to 
 be so used or has been so used, or (2) upon the transportation of company 
 materials transported by one carrier, which constitutes a part of a railroad 
 system, for another carrier which is also a part of the same system. 
 
 Art. 23. Effect of foregoing provision. — The sole effect of this pro- 
 vision of the act is to exempt from the tax all transportation charges 
 made by or which would accrue to a carrier, were such charges made 
 by that carrier, on all materials, supplies, or other commodities 
 transported hy such carrier which are necessary for its use in the 
 conduct of its business as such carrier, and intended to be or having 
 been so used. 
 
 Art. 24. Stock of one corporation oioned hy another. — The fact 
 that all or part of the capital stock of a corporation is owned by 
 another corporation does not affect the application of sections 500 
 and 501 of the act to each corporation as an entity. 
 
 Art. 25. Application of tax. — The tax applies to all transportation 
 charges made by, or which would accrue to, a carrier, were such 
 charges made by it, on all materials, supplies, or other commodities 
 transported by that carrier for another carrier, even though such 
 commodities be necessary for the use of such other carrier in the con- 
 duct of such other carrier's business as such, subject, however, to the 
 following qualifications: 
 
 (a) As provided by section 501 of the act, the tax is not imposed 
 "upon the transportation of company material transported by one 
 carrier, which constitutes a part of a railroad system, for another 
 carrier which is also a part of the same system." The term " a rail- 
 road system " is held to mean two or more railroads and such other 
 carriers as may be operated in conjunction therewith, all such rail- 
 roads and other carriers being under one general operating manage- 
 ment and even though each such railroad or other carrier maintain 
 its corporate identity. 
 
 (&) If the facilities of an express company operating on the line 
 of a railroad company be necessary for the use of such railroad com- 
 pany in the conduct of the railroad company's business as such, and 
 if the railroad company, under contract, transports commodities
 
 TAX ON TRANSPORTATION AND OTHER FACILITIES. 15 
 
 necessary to maintain or operate such facilities, such commodities 
 being intended to be or having been so used, and the raih'oad com- 
 pany makes no charge for such transportation, the charges which, 
 but for such arrangement, would have accrued on such transporta- 
 tion are exempt from the tax. 
 
 (c) If a telegraph or telephone line or lines along the line of a 
 railroad company be necessary for the use of such railroad company 
 in the conduct of the railroad company's business as such, and if 
 the railroad company, under contract, transports commodities neces- 
 sary to maintain or operate such telegraph or telephone line or lines 
 along the line of such railroad company, such commodities being 
 intended to be or having been so used, and the railroad company 
 makes no charge for such transportation, the charges which but for 
 such arrangement would have accrued on such transportation are 
 exempt from the tax. 
 
 (d) If a terminal or yard for the use of oiie or more railroads, 
 jointly or severally, be operated under the management of a ter- 
 minal or switching company, or of such railroad or railroads, and 
 the user cost therefor to them be based on either gross or net costs 
 of operation, the commodities necessary in the operations of such 
 terminal or yard shall, as respects the provisions of sections 500 and 
 501, be considered as commodities necessary for the use of such car- 
 riers thereof; and the tax does not apply to the transportation 
 charges for such commodities if transported over the lines of such 
 carriers. If, however, a terminal or yard be operated under its 
 own management for profit, or if a fixed rental be charged users 
 or tenants for services rendered by the terminal or switching com- 
 pany, the tax applies to the transportation charges made by tenants 
 or users on such commodities. 
 
 (e) The transportation tax on freight charges accruing on ship- 
 ments of company material carried by one railroad for another 
 should be collected by the railroad collecting the freight charges 
 from the railroad owning the material. 
 
 Art. 26. Federal control. — The Federal control of railroads con- 
 stitutes all the carriers operated by the Government one system 
 within the meaning of this exemption. The transportation of 
 company material transported by one carrier under Federal control 
 for another carrier also under Federal control is not taxable. 
 
 Art. 27. Circus trains. — Where a lump-sum charge is made for 
 the transportation of a circus train, which carries both property and 
 persons, the 3 per cent tax applies to such charge. If, however, ad- 
 vance passenger transportation is included in such lump sum charge, 
 the 8 per cent tax apjplies to such portion of the charge as represents
 
 16 TAX ON TRANSPORTATION AND OTHER FACILITIES. 
 
 tho charge for advance passenger transportation, and the 3 per cent 
 tax applies to tho bahmce of the hunp sum charge. 
 
 Art. 28. Milk^ netospapers, and other commodities. — The amounts 
 paid for transportation, other than by express, of milk, newspapers, 
 and other commodities are subject to the tax of 3 per cent. 
 
 Whenever two or more tickets for the transportation of commodi- 
 ties are sold in book form or in bulk, the tax applies to the aggre- 
 gate amount paid for the tickets so purchased. 
 
 Art. 29. State inspection ch^vfjes. — State inspection charges col- 
 lected by a carrier as an agent of the State are not amounts paid for 
 transportation services and are not subject to tax. 
 
 Art. 30. Storage charges. — Amounts paid for storage if a part of 
 transportation are subject to tax. Storage after delivery to owner 
 is not a part of transportation. Storage hj or in behalf of a carrier 
 furnished to a shipper on receipt of his goods for shipment, or 
 storage by or in behalf of a carrier at destination before delivery to 
 owner, whether in outside warehouse or otherwise, is a part of trans- 
 portation and subject to tax. 
 
 Art. 31. Blocking and staking charges. — Blocking and staking 
 property in cars if furnished by or in behalf of a carrier is part of 
 transportation, and charges for said services paid by either the con- 
 signor or consignee of the property are subject to the tax. 
 
 Art. 32. Property sold. — If a consignment of property trans- 
 ported, including baggage, be refused or unclaimed and sold at pub- 
 lic or private sale under Federal or State statutes or regulations, or, 
 in the absence thereof, under the rules and regulations of a carrier, or 
 if a carload of property or a perishable consignment be sold under 
 emergency conditions for the benefit of whom \t may concern, then 
 and in any such case the net amount realized therefrom shall be con- 
 sidered the transportation charge applicable to such consignment, and 
 the 3 per cent tax shall apply to such amount and be paid by the pur- 
 chaser: Provided^ however^ That if such amount be in excess of the 
 actual transportation charges accruing, on such consignment, the tax 
 shall not appl}^ to such excess. 
 
 Art, 33. Chartered hoats. — When boats are chartered and the per- 
 son chartering the boats transports therein his own property, the 
 amount paid for chartering such boats is not a transportation charge 
 subject to the tax. 
 
 Art. 34. Combined freight and express services or facilities. —   
 When property is transported between two points, partly by freight 
 and partly by express, the 3 per cent tax applies on the amount paid 
 for the freight movement, and the tax of 1 cent for each 20 cents or 
 fraction thereof applies on the amount paid for the express move- 
 ment. The carrier collecting the total transportation charges shall 
 collect, report, and pay the total tax due.
 
 TAX OF TRANSPORTATION AND OTHER FACILITIES. 17 
 
 Art. 35. Transportation hy mechanical motor power when in com- 
 petition with carriers hy rail or water of property 'by freight. — • 
 Transportation of property by freight by mechanical motor power 
 is taxable only when in competition with carriers by rail or water. 
 Wlien property is transported between two points by mechanical 
 motor power and rail or water transport atioii is furnished between 
 the same points, competition is deemed to exist in the absence of 
 unusual conditions. 
 
 Transportation of household goods by mechanical motor power is 
 transportation of property by freight. If such transportation is 
 conducted in competition with transportation by rail or water, it is 
 subject to the transportation tax. 
 
 Wlien the amounts charged for transportation by automobile vans 
 include services of packing and unpacking furniture, carrying goods 
 up and down stajrs, moving pianos, safes, etc., out of windows, the 
 tax will apply to the entire charge made for the service unless the 
 amounts can be apportioned between the actual transportation charges 
 and the other charges. 
 114310°— 19 3
 
 PART III. 
 
 TRANSPORTATION OF PACKAGES, PARCELS, OR SHIP- 
 MENTS BY EXPRESS. 
 
 Section 500, subdivision (b) of the act. imposes: 
 
 A tax of 1 ccut for each 20 cents or fraction thereof of the amount paid to 
 any i^ersou for the transportation on or after such date, by rail or water or by 
 any form of mechanical motor power when in competition with express by rail or 
 water, of any package, parcel, or sliipment, by express, transported from one 
 point in the I'niled States to another; and ti like tax on the amount paid for 
 such transportation within the United States of property transported from a 
 point without the United States to a point within the United States. 
 
 Art. 3G. Application of tax. — The provisions of Parts I and II 
 hereof, in so far as they are applicable to transportation of packages, 
 parcels, or shipments by express from one point in the United States 
 to another, are held to control in connection with the application of 
 the express tax. 
 
 If the facilities of a railroad company on the line of which an 
 express company operates be necessary for the use of such express 
 company in the conduct of the express company's business as such, 
 and if the express company, under contract, transports commodities 
 necessary to maintain or operate such facilities, such commodities 
 being intended to be or having been so used, and the express com- 
 pany makes no charge for such transportation, the charges which, but 
 for such arrangement, would have accrued on such transportation 
 are exempt from the tax. 
 
 Art. 37. (a) Transportation by express by mechanical motor 
 power is not taxable unless in competition with transportation by ex- 
 press by rail or water. 
 
 (5) A company engaged in transporting baggage, exclusivelj'-, and 
 which does not transport other parcels or ^iackages, is not engaged 
 in the business of transporting parcels and packages by express. 
 18
 
 PART IV. 
 
 TRANSPORTATION OF PERSONS. 
 
 Section 500, subdivision (c), of the act imposes: 
 
 A tax equivalent to eight per centum of tlie amount paid for the transporta- 
 tion of persons by rail or water, or by any form of mechanical motor power on 
 a regular established line when in competition with carriers by rail or water, 
 from one point in the United States to another or to any point in Canada or 
 Mexico, where the ticket or order therefor is sold or issued in the United 
 States, not including the amount paid for commutation or season tickets for 
 trips less than thirty miles, or for transportation the fare for which does not 
 exceed 42 cents. 
 
 SERVICES AND FACILITIES TAXABLE— GENERAL PROVISIONS. 
 
 Art. 38. Application of fax. — The 8 per cent tax applies to 
 amounts paid for transportation of persons by carriers, as follows : 
 
 {a) From a point in the United States to another point therein, 
 even though the persons pass out of the United States in the course 
 of such transportation. 
 
 (b) From a point in the United States to a point in Canada or 
 Mexico, where the ticket or order therefor is sold or issued in the 
 United States. 
 
 (c) From a point in the United States to another point therein, 
 or — ^where the ticket is sold or issued in the United States — from a 
 point in the United States to a point in Canada or Mexico, when 
 such transportation is part of through transportation to or from a 
 foreign country, other than Canada or Mexico. 
 
 The tax is held to apply to each and every service and facility, 
 except passengers' meals and hotel accommodations, rendered by or 
 on behalf of carriers in connection with transportation, as herein 
 defined, of persons, where the transportation in connection with 
 which the service or facility is rendered is subject to the tax. 
 
 Art. 39. Regular estahlished line. — The phrase " a regular estab- 
 lished line" as used in section 500, subdivision (c), is held to mean a 
 regularity of operation of transportation facilities by motor power 
 between definite points. If such motor transportation is furnished 
 with regularity between points which are connected by rail or water 
 routes, it is not necessary that the automobile or motor transporta- 
 tion pursue a specified route of travel. The regularity of operation 
 of the motor transportation is the essential element of " a regular 
 established line." 
 
 19
 
 20 TAX ON TRANSPORTATION AND OTHER FACILITIES. 
 
 Art. 40. Ronnd-trlp ticket. — The tax applies to the amount paid 
 for, or applicable to, such transportation, including the charge paid 
 for a round-trip ticlcet, provided such mnount is in excess of 42 cents. 
 
 Art. 41. Commi<tat'wn and season tickets. — The term "commuta- 
 tion or season tickets," as used in section 500, subdivision (c) of the 
 act, is held to include all forms of tickets issued and intended for 
 use for a certain number of trips between two given termini, Avhether 
 limited or milimited as to the time in which they are to be used. 
 
 The phrase '' for trips less than thirty miles," as used in said sub- 
 division of the act in connection with commutation and season tickets, 
 is held to mean for less than 30 constructive miles in instances where 
 the rate for transportation is fixed on the constructive mileage. 
 
 Art. 42. Zone system. — If a person pays or a carrier collects the 
 fare for a continuous journey at intervals in amounts of less than 42 
 cents, as in the zone system, the tax must be collected on the total 
 charges from starting point to final destination of such person, if the 
 charges aggregate 43 cents or more. 
 
 Art. 43. Comhination fares. — In cases in which continuous trans- 
 portation is secured, either by the use of the same or different kinds 
 or classes of tickets or by the use of such tickets in connection with a 
 cash fare, the tax applies, provided the total amount paid for such 
 transportation exceeds 42 cents. 
 
 SERVICES AND FACILITIES TAXABLE— MISCELLANEOUS PRO- 
 VISIONS. 
 
 Art. 44. Tickets hought.^ and, wholly or imrtiaUy unused., 'prior to 
 
 November i, 1917 — The ^.c^.— Section 501, subdivision (b) of the act, 
 
 in part provides : 
 
 If a ticket (otlier thau a mileage book) was bought and partially used before 
 November 1, 1917, it shall not be taxed, but if bought but not so used before 
 section 500 takes effect, it shall not be valid for passage until the tax has been 
 paid and such payment evidenced on the ticket in such manner as the Com- 
 missioner, with the approval of the Secretary, may by regulation prescribe. 
 
 Art. 45. Manner of evidencing payment of tax on such tickets. — 
 Payment of the 8 per cent tax upon tickets bought but not used prior 
 to November 1, 1917, shall be evidenced by' indorsement thereon by 
 and over the signature and title of the employee collecting the ticket, 
 showing the payment of the tax. 
 
 Art. 46. Special provisions relating to such tickets. — Employees 
 collecting such tickets presented for passage must require the pay- 
 ment of taxes on any ticket, excluding commutation and season 
 tickets, the sale date of which is prior to November 1, 1917, unless 
 such ticket and the conditions under which it is presented conclu- 
 sively show that the ticket has been used prior to November 1, 1917, 
 for a part of the journey called for by it. If the return portion of a
 
 TAX OF TRAFSPOETATIOIT AlTD OTHER FACILITIES. 21 
 
 round-trip ticket sold before November 1, 1917, be presented for a 
 continuation of the journey, the tax does not apply. Commutation 
 or season tickets sold and partially used before November 1, 1917, are 
 not taxable if presented after that date for the remainder of the 
 journey or journe5^s called for. 
 
 Art. 47. Partially used mileage hoohs paid for hefore November 7, 
 1917 — The act. — Section 501, subdivision (b) of the act, among other 
 things, provides: 
 
 If a mileage book used for such transportation or accommodation was pur- 
 chased before November 1, 1917, or if cash fare is paid, the tax imposed by sec- 
 tion 500 shall be collected from the person presenting the mileage book, or 
 paying the cash fare, by the conductor or other agent, when presented for such 
 transportation or accommodation, and the amount so collected shall be paid to 
 the United States in such manner and at such times as the Commissioner, with 
 the approval of the Secretary, may prescribe. 
 
 Art. 48. Provisions relating to such hooJcs. — The provision applies 
 whether the mileage book was purchased in the United States, 
 Canada, or Mexico. 
 
 Amounts collected pursuant to the above-quoted provisions shall 
 be reported and returned as herein prescribed in respect of other 
 charges collected by carriers for transportation of persons. 
 
 If a mileage book sold in the United States prior to November 1, 
 1917, be presented for a mileage exchange ticket, or on a train for 
 transportaion, the 8 per cent tax applies on the sale value of the 
 coupons or scrip remaining in such book, and shall be collected by 
 the employee to whom such book is presented for transportation ; evi- 
 dence of the payment of such tax shall be indorsed thereon by and 
 over the signature and title of the employee collecting the tax. 
 
 Art. 49. Mileage hoohs purchased in the United States. — The 8 
 per cent tax applies to the gross amount paid for a mileage book, as 
 and when collection is made therefor. 
 
 If an evidence of right to exemption be delivered to the carrier at 
 the time of purchase of a book, such book shall be stamped " Exempt 
 from tax." 
 
 Art. 60. Mileage hoohs purcha.sed in Canada or Mexico. — The 8 
 per cent tax applies to the amount paid for the coupons lifted in the 
 United States from mileage books purchased in Canada or Mexico 
 when used for transportation {a) from one point in the United States 
 to another, even though such journey involve passing out of the 
 United States, or (6) from a point in the United States to any point 
 in Canada or Mexico, or [c) from a point in the United States to 
 another point therein or to a point in Mexico or Canada, when suck 
 transportation is part of through transportation to or from a foreign 
 country other than Canada or Mexico, and shall be collected when 
 the coupons are lifted.
 
 22 TAX OlSr TEANSPORTATION AND OTHER FACILITIES. 
 
 The tax does not apply to the amount paid for the coupons lifted 
 from mileage books purchased in Canada or Mexico when used for 
 throuoh transportation from a point in Canada or Mexico to a point 
 in the United States. 
 
 Art. 51. The 8 per cent tax applies to all cash fares paid on traiiLs 
 from a point in the United States to a point in the United States, 
 Canada, or Mexico, provided the total cash fare for a continuous 
 journey exceeds 42 cents. 
 
 Art. 52. Party tickets. — The 8 per cent tax applies to the total 
 amount paid for a party ticket. 
 
 Art. 53. Prepaid orders. — The taxes applicable to amounts paid 
 for transportation, as Avell as the taxes applicable to amounts paid 
 for accommodations in sleeping and parlor cars and on vessels, apply 
 in like manner to amounts paid for prepaid orders calling for such 
 transportation and accommodations, or either of them. The ticket 
 for the transportation covered by a prepaid order shall be deemed 
 sold and issued at the point where the initial carrier's transportation 
 begins. 
 
 Where a carrier or agency, in collecting the amount paid for 
 such prepaid order, acts on behalf of any or all of the several carriers 
 who are to furnish the services or facilities covered, the carrier or 
 agency first referred to shall collect the taxes on the total charges for 
 such prepaid order as and when such charges are collected, and remit 
 such total charges and taxes to the initial carrier issuing the ticket, 
 and the initial carrier shall return and pay such taxes. 
 
 Art. 54. Exchange orders. — Where an exchange order is issued in 
 the United States, Canada, or Mexico, as part of or in connection 
 with through transportation, the ticket for wdiich the exchange order 
 is exchanged shall be deemed to be a ticket sold and issued at the 
 point where the exchange order was issued. An exchange order sold 
 in the United States for through transportation to a point in the 
 United States, Canada, or Mexico is held to be subject to the tax 
 upon the total amount of chaiges paid, even though the order calls 
 for an exchange for another ticket in Canada or Mexico. Where an 
 exchange order is issued outside the United Stifles, Canada, or 
 Mexico, as part of or in connection with through transportation, the 
 ticket for which the exchange order is exchanged shall be deemed to 
 be a ticket sold and issued at the point where such exchange is made. 
 
 The tax applies to any additional amount paid in the United States 
 in connection with a ticket or an exchange order issued in Canada, 
 Mexico, or any other foreign country. 
 
 Art. 55. Steamship orders. — The provisions contained in article 
 80 as respects exchange orders and tickets issued in exchange there- 
 for similarly apply to steamship orders and tickets issued in exchange 
 for steamship orders.
 
 TAX ON TRAlfTSPOKTATIOX AND OTHER FACILITIES. 23 
 
 Art. 56, Excess haggage. — The 8 per cent tax applies to the 
 amount paid for transporting baggage in excess of the free alloTv- 
 ance, provided the amount so paid exceeds 42 cents. 
 
 Art. 67. Storage of haggage. — The 8 per cent tax applies to 
 amounts paid for storage of baggage transported in connection -with 
 the transportation of persons, provided the amount paid exceeds 
 42 cents. 
 
 Art. 58. CoTnputation of tax. — In determining if the amount paid 
 for excess baggage or storage of baggage charges exceeds 42 cents, 
 amounts so paid are considered separately from amounts paid for the 
 transportation of the person. 
 
 Art. 59. Corpses. — The amount paid for the transportation of a 
 corpse is subject to the 8 i)er cent tax if the corpse be transported on 
 a passenger ticket or an excess-baggage check. If, however, a corpse 
 be transported by freight or by express, the freight or the express 
 tax, as the case may be, applies. 
 
 Art. 60. Extra fares for special services or facilities. — If an extra 
 fare for special services be charged in addition to the transportation 
 rate, the 8 per cent tax applies, and shall be collected thereon. 
 
 The foregoing provision applies to amounts paid for additional 
 passenger tickets purchased or fares paid for exclusive occupancy 
 of drawing rooms, compartments, or sections in sleeping or parlor 
 cars or accommodations furnished on steamers. 
 
 Art, 61. Chartered cars or trains. — A tax of 8 per cent applies to 
 the charge for a chartered or special car or train, including sleeping, 
 parlor, and private cars, for the purpose of transporting persons, 
 whether such charge be a lump sum or on a per capita basis. 
 
 SERVICES AND FACILITIES NOT TAXABLE. 
 
 Art. 62. Cases in ivhich tax does not apply. — The 8 per cent tax 
 does not apply to amounts paid for transportation of persons by 
 carriers, as follows: 
 
 (a) From the last port touched in the United States to a foreigti 
 port other than a Canadian 'or Mexican port. 
 
 (h) From a point in Canada or Mexico to a point in the United 
 States. 
 
 (c) From a point in Canada to another point therein, and pro- 
 vided such transportation be covered by tickets issued in Canada and 
 be a part of through transportation, even though the persons pass 
 through the United States in course of such transportation. 
 
 (d) From a point in Mexico to another point therein, and pro- 
 vided such transportation be covered by tickets issued in Mexico and 
 be part of through transportation, even though tlie persons pass 
 through the United States in course of such transportation.
 
 24 TAX ON TRANSPORTATION" AND OTHER FACILITIES. 
 
 (e) From a point in Canada to a point in Mexico, or vice versa, 
 provided such transportation be covered by tickets issued in Canada 
 or Mexico and bo part of through transportation. 
 
 (/) Where the amount paid for transportation is 42 cents or less. 
 
 {g) In case of connnutation or season tickets for trips less than 
 thirty (30) miles. 
 
 (h) Where persons arc carried free under the provisions of Fed- 
 eral or State laws. 
 
 TAX ON AMOUNTS PAID FOR ACCOMMODATIONS IN PARLOR OR 
 SLEEPING CARS OR ON VESSELS. 
 
 Section 500, subdivision (d), of the act imposes: 
 
 A tax equivulent to eight per centum of the amount paid for seats, bertlis, 
 and stateroom in parlor cars, sleeping cars, or on vessels, used in connection 
 with transportation, upon which tax is imposed by subdivision (c). 
 
 Art. 63. Accommodations to 'wliich tax applies.— The foregoing 
 provision is held to include application to the amount paid for each 
 drawing-room or compartment in parlor or sleeping cars or on ves- 
 sels and to seats in observation or composite cars. 
 
 In case of a chartered sleeping, parlor, or private car. the total 
 amoimt paid for the haul and the special accommodations are. exclu- 
 sive of meals, subject to an 8 per cent tax. If separate charges are 
 made covering the combined services and such charges are paid to 
 different parties, such parties will each be required to collect and 
 return the taxes due. 
 
 The 8 per cent tax applies to amounts paid for all of the accop.nno- 
 dations referred to above, for use in connection with transportation 
 between points in the United States or from a point in the United 
 States to a point in Canada or Mexico, whether payment thereof be 
 made in the United States or elsewhere, and even though such trans- 
 portation be part of through transportation to or from a foreign 
 country, other than Canada or Mexico. The tax also applies to 
 amounts paid for commutation books purchased in the United States 
 calling for any of such accommodations', for use as above stated, in 
 which event the tax thereon shall be paid as and when collections are 
 made of the amount paid for such books. If such commutation 
 books, however, be purchased outside the United States, the tax 
 applies to the amount pa,id for the coupons lifted therefrom calling 
 for accommodations between or from points in the United States, as 
 in this paragraph first specified, and such tax shall be collected as 
 flnd when such coupons are lifted. 
 
 Where the amount paid for transportation of persons includes ac- 
 commodations on vessels, the entire amount paid for the transpor-
 
 TAX ON TRANSPORTATION AND OTHER fACILITILS. 25 
 
 tation, including such accommodations, is sii1)ject to tlie 8 per cent 
 tux. 
 
 Art. 64. Accommodations to wJiicIi tax does not apply. — The 8 per 
 cent tax does not apply to — 
 
 {a) Amounts paid for tickets, including commutation books,, paid 
 for and partially used before November 1, 191V. 
 
 (&) Accommodations furnished free under the provisions of Fed- 
 eral or State laws. 
 
 Art. Go Duties of agents collecting cluirges on behalf of earners 
 furnishing such accommodations. — Where an agent of one carrier in 
 collecting the amounts paid for seats, berths, or staterooms in parlor 
 or sleeping cars or on vessels acts on behalf of any or all of the sev- 
 eral carriers who are to furnish the accommodations involved, such 
 agent shall collect the taxes on the total charges as and when such 
 charges are collected and remit to such other carriers the respective 
 amounts, charges and taxes, collected on their behalf, and such other 
 carriers shall return and pay such taxes.
 
 PART V. 
 TRANSPORTATION OF OIL BY PIPE LINE. 
 
 Section 500, subdivision (c), imposes: 
 
 A tax equivalent to eight per centum of tlie amount paid for the transporta- 
 tion on or after such date of oil by pipe line. 
 
 Akticle 6G. Definition of oil. — The word " oil," as used in the fore- 
 going subdivision, is held to mean crude petroleum and such of its 
 products as may be transported by pipe line. 
 
 Article 67. Miscellaneous provisions. — Section 501, subdivision 
 (d), provides that the tax imposed by subdivision (e) of section 500 
 shall apply to all transportation of oil by pipe line. In case no charge 
 for transportation is made, by reason of ownership of the commodity 
 transported, or for any other reason, the person transporting by pipe 
 line shall pay a tax equivalent to the tax which would be imposed if 
 such person received payment for such transportation, and if the 
 tax can not be computed from actual bona fide rates or tariffs it shall 
 be computed (1) on the basis of the rates or tariffs of other pipe 
 lines for like services, as determined by the Commissioner, or (2) if 
 no such rates or tariffs exist, on the basis of a reasonable charge for 
 such transportation, as determined by the Commissioner. 
 
 Amounts paid for transportation of oil by pipe line commencing 
 prior to April 1, 1919, although the transportation does not end until 
 after that date, are subject to the tax imposed by the Revenue Act of 
 1917. Such amounts paid for the transportation of oil by pipe line 
 are subject to the tax imposed by the Revenue Act of 1918 only when, 
 the transportation commences on or after April 1, 1919. The date 
 when such amounts are paid for such transportation does not affect 
 the question as to which rate of tax applies. 
 
 Reference should be had to Parts I and II, the provisions whereof, 
 in so far as they are applicable to transportation of oil by pipe line, 
 are held to control in connection with the application of the tax im- 
 posed undsr subdivision (e) of section 500 of the act. 
 26
 
 PAET VI. 
 EXEMPTIONS. 
 
 GOVERNMENTAL EXEMPTION. 
 
 Section 500, subdivision (h) , of the act provides : 
 
 No tax shall be imposed under this section upon any payment received for 
 services rendered to the United States or to any State or Territory or the 
 District of Columbia. The right to exemption under this subdivision shall be 
 evidenced in such manner as the commissioner, -with the approval of the Sec- 
 retary, may by regulation prescribe. 
 
 Art, 68. Nature of exemqHion. — The words " State " and " Terri- 
 tory " include political subdivisions thereof, such as counties, cities, 
 towns, and other municipalities. The exemption, however, is to be 
 secured only upon the jDroduction of such evidence of right to exemp- 
 tion as is called for by these regulations. 
 
 Aet. 69. Foreign governments. — Amounts paid by foreign govern- 
 ments for transportation and transmission services are subject to the 
 taxes imposed under section 500. 
 
 Art, 70. Government agencies. — Transportation services rendered 
 to agencies of the United States are exempt from the tax. Such 
 agencies include the American National Eed Cross, United States 
 Shipping Board Emergency Fleet Corporation, United States Food 
 Administration Grain Corporation, United States Fuel Administra- 
 tion, United States Housing Corporation, Commission on Training 
 Gamp Activities, War Savings Committee, Liberty Loan Commit- 
 tee, War Industries Board, Federal Farm Appi^isers, Federal land 
 banks. Federal reserve banks, Panama Eailroad Co., and similar 
 agencies supported bj^ Government funds. 
 
 (a) EXEMPTION— PROPERTY. 
 
 Art. 71. Evidences of right to exemjytion. — The right to exemp- 
 tion under section 500 from the tax on amounts paid for the transpor- 
 tation of propert}' shall be evidenced in one of the following ways : 
 
 {a) Payment of such amounts directly to the carrier by the GoV^' 
 ernment to which the services are rendered. 
 
 27
 
 28 TAX ox TEAXSPOETATIOIT AND OTHER FACILITIES. 
 
 (h) A standard form of exemption certificate for use of the Federal 
 Government, substantially in form following: 
 
 EXEMrTION CERTIFICATE. 
 
 ^ TAX ON TEANSrOKTATION OF ntOPEKTY. 
 
 h 
 
 * TREASimV DErARTMBNT. 
 
 g Office Comaiissionku oi- Inteknal Revexue. 
 
 a l<'orm 750. 
 
 a Date 
 
 ej Place of payment of charges 
 
 g Name of carrier collecting chargcs- 
 
 S I certify that the transportation charges on the property described in the waybill, 
 
 %j bill of lading, freight bill, or express receipt, dated , covering 
 
 o 
 
 t; a shipment carried from to , 
 
 fi 
 
 ■^ in car Initial and No. or vessel named 
 
 tn 
 
 o to which this exemption certificate is attached, 
 
 .5 have been or will be paid by the United States, and that the transportation charges 
 
 p thereon, amounting to ? , are exempt under section 500 of the 
 
 rt revenue act of 1918 from the tax Imposed by said act. 
 
 o (Signature of Government officer or employee.) 
 
 (3j 
 
 p (Federal department or establishment.) 
 
 c3 
 
 (Title.) 
 
 ■s penalty fok feauddlent use, $1j000 and imprisonment. 
 
 o 
 
 a Note. — Transportation agents should not accept this certificate unless satisfied, 
 
 £ through the production of proper credentials or otherwise, that the person wh» 
 
 fi signed it is an ofiicer or employee of the Federal Government. 
 
 A separate exemption certificate will be required for each shipment. 
 ^ A blanliet certificate covering two or more shipments or a given period will not 
 cj be accepted as evidence of right to exemption. 
 xa This certificate should not be issued to secure exemption upon transportation 
 
 charges in the case of " lump-sum " contracts, or when the material transported 
 
 Is sold to the Government at a delivered price. 
 
 (c) A form of exemption certificate, substantially in accord with 
 the preceding form, for use by any of the States or Alaska or Hawaii, 
 or any political subdivision thereof, or the District of Columbia, 
 showing the political subdivision by which the charges have been or 
 will be paid. 
 
 (b) EXEMPTION— PERSONS. 
 
 Art. 72. Evidences of right to exemption. — The right to exemption 
 under section 500 from the tax on amounts paid for the transporta- 
 tion of persons shall be evidenced in one of the following ways : 
 
 {a) A standard form of transportation request as prescribed and 
 used by the Federal and State Governments.
 
 TAX ON TRANSPORTATION AND OTHER FACILITIES. 
 
 29 
 
 (h) A standard form of exemption certificate for use of officers or 
 employees of the Federal Government, substantially- in form fol- 
 
 lowing : 
 
 0) 
 
 .a 
 
 01 .S 
 
 no 
 
 
 o o 
 rt M 
 
 o 
 a 60 
 
 -I 
 
 ■-pS 
 
 ID 
 
 B 
 
 o© 
 
 i» o 
 
 a 
 
 ej 
 EH 
 
 Fouii 731. 
 U. S. Internal Revenue. 
 
 EXEMPTION CERTIFICATE. 
 
 TAX OX THE TBANSPOBTATION OF PERSONS. 
 
 Place of issue of ticket Date 
 
 Name of carrier 
 
 Number. 
 
 Indicate by X. 
 
 Service (indicate amount paid in proper space). 
 
 Ticket. 
 
 Form. 
 
 Rail. 
 
 Water. 
 
 Transpor- 
 tation. 
 
 Seat. 
 
 Berth. 
 
 State- 
 room. 
 
 Excess 
 baggage. 
 
 
 
 
 
 $ 
 
 $ 
 
 $ 
 
 $ 
 
 $ 
 
 
 From- 
 To _— 
 
 Via- 
 
 (Givc name or names of transportation company.) 
 
 I certify that the charges for the services indicated above have been, or will be, 
 paid for by the United States, are incurred In the performance of my official duties, 
 and arc exempt under section 500 of the revenue act, 1918, from the tax imposed by 
 said act. 
 
 (Federal Department or establishment.) 
 
 (Signature of Govt, officer or employee.) 
 
 PEXATV FOR FRAL'DITLENT USB, 
 
 $1,000 and imprisonment. 
 
 (Official title.) 
 
 [REVERSE SIDE.] 
 
 Note. — A separate exemption certificate will be required for each ticket furnished, fare 
 collectfHl, or service rendered, except that officers or employees representing the interests 
 exempt, when conducting prisoners or other persons vyhose transportation costs are paid 
 by such interests, may give one certificate to cover the party. 
 
 1. A form of exemption certificate, substantially in accord with this form, should be 
 provided by the States, the Territories of Alaska and Hawaii, and the District of Colum- 
 bia, or the political subdivisions thereof, for the use of officials and employees. Such 
 certificates will not be furnished by the Internal Revenue Bureau. 
 
 ■2. W^here the person transported is incurring the charge in the performance of hi."? 
 official duties as an officer in the Army or Navy, a standard form of exemption certificate 
 for such use should be provided as follows : 
 
 EXEMPTION CEKTIFICATE. 
 
 . , 19 
 
 I certify that ticket No. , for transportation from 
 
 to , via 
 
 is on account of official business and not for private purposes, and is exempt from the tax 
 imposed by the Revenue Act of 1918. 
 
 (Name of officer.) 
 
 ^("Rank.") 
 
 Note. — Forms 1 and 2 should be on the 
 
 same size paper as this form. (Branch of service.) 
 
 (c) A form of exemption certificate, substantially in accord with 
 the preceding form, for use by any of the States or Alaska or Hawaii, 
 or any political subdivision thereof, or the District of Columbia,
 
 so TAX ON TRANSPORTATION AND OTHER FACILITIES. 
 
 sho'wing tlio political subdivision by :svhich the charges have been, 
 or Avill be, paid. 
 
 (d) AVhere the person transported is incurring the charge in the 
 performance of his official duties as an officer in the Army or Navy, 
 a standard form of exemption certificate for such use as follows: 
 
 EXEMPTION CERTIFICATE. 
 
 , 19—. 
 
 I certify tliat ticket No. for transportation from 
 
 to , via , is on account of official 
 
 business and not for private pun^oses and is exempt from tlie tax imposed by 
 section 500 of the revenue act of 191S. 
 
 (Rank.) 
 
 (Army or Navy.) 
 
 An appropriate form of e:^^emption certificate must be delivered to 
 the conductor of the train upon which an officer or employee of the 
 United States, or of any State, or Alaska or Hawaii, or any political 
 subdivision thereof, or of the District of Columbia, is traveling upon 
 official business, using a mileage book not marked exempt from tax, 
 and upon which the tax has not been paid, each time mileage coupons 
 are lifted; otherwise the tax must be collected on the sale value of 
 the coupons lifted. 
 
 Art. 73. Anibassadors^ ministers, and diplomatic representa- 
 tives. — Ambassadors, ministers, and properly accredited diplomatic 
 . representatives of any foreign government to the United States are 
 exempt from the payment of taxes on amounts paid for transporta- 
 tion services rendered them within the United States. 
 
 The following form may be used to secure exemptions when signed 
 by an ambassador, minister, or any properly accredited diplomatic 
 representative of a foreign government : 
 
 FOEM No. « 
 
 19__. 
 
 I certify tliat ticket No. for transportation from 
 
 , to via .^^ Is far use of 
 
 »_ , attached to my , and is exempt from tax. 
 
 (Title.)
 
 TAX ON TBANSPORTATION AND OTHER FACILITIES. 81 
 
 (c) EXEMPTION PROVISIONS— COST-PLUS CONTRACTS. 
 
 Art. 74. Cost-plus contracts. — Amounts paid for the transporta- 
 tion of freight or persons, which are finally paid by the Government 
 under cost-plus contracts, are exempt from the taxes imposed by sec- 
 tion 500 of the act. 
 
 (1) Where a contractor does work for the Government, the con- 
 tract price of which is the cost plus a certain percentage, the amount 
 received by a carrier for the transportation of property used or to 
 be used by the contractor in the Government work falls within the 
 exemption from the transportation tax as provided by section 500. 
 
 In any such case, as in other cases of exemption, the proscribed 
 certificate of exemption (Form T50) must be used and must be 
 signed b}^ a Government officer or emploj-ee. A certificate signed by 
 the contractor does not furnish the required evidence of exemption. 
 
 (2) Exemption may be claimed on amounts paid for the trans- 
 portation of persons employed by a contractor working for the Gov- 
 ernment under a cost-plus contract where the transportation charge 
 of the employee is an item in the cost of the work and hence will 
 be finally paid by the Government. 
 
 In such case the right to exemption from the tax on the amount 
 paid for transportation of such employee shall be evidenced by an 
 exemption certificate signed by a governmental officer or employee, 
 substantially in the following form: 
 
 EXEMPTION CESTIFICATE. 
 
 , 19—. 
 
 I certify that ticket No. , for transportation from 
 
 to . via , is for use of an employee of 
 
 , and is to be paid for by the United States Government. 
 
 (Name of contractor.) 
 
 (Signature of governmental officer or 
 employee.) 
 
 (TiUe.) 
 Place of is.sue 
 
 Name of carrier 
 
 GENERAL EXEMPTION PROVISIONS— PROPERTY AND PERSONS. 
 
 Art. 75. Oredentials. — The credentials referred to on the margin' 
 of the exemption certificates are such papers, documents, or other 
 evidences as will reasonably assure the officer, agent, or other em-
 
 32 TAX ON TRANSPORTATIOX AND OTHER FACILITIES. 
 
 ployco collecting tho transportation charge that the officer or em- 
 ployee issuing such certificate is an officer or employee of the Govern- 
 ment on whose behalf the certificate is issued. 
 
 Art. 7G. Forms to he furnished. — Exemption certificates, Forms 
 731 and 750, will, on request, be furnished by the Treasury Depart- 
 ment to officers and emplo3'ces of the Federal Government entitled 
 thereto. A State, Territory, or political subdivision thereof, or the 
 District of Columbia, will be required to furnish its own blanks for 
 claiming exemption from the tax. 
 
 Art. 77. Lump-sum Government contracts. — Where a contractor 
 does work for the Government, the contract price of which is a lump 
 sum, the ex&mption does not apply to amounts paid for transporta- 
 iton of property used or to be used by the conti:actor in connection 
 with the work. 
 
 Art. 78. Exemption — Parsons. — Exemption may be claimed in the 
 case of persons only where the person transported is incurring the 
 charge in performance of his official duties as an officer or employee 
 of the United States or of a State or Territory, or any political sub- 
 division thereof, or of the District of Columbia. Thus, transporta- 
 tion charges paid by soldiers traveling on furlough at their own ex- 
 pense are not exempt. The fact that the amount of mileage or other 
 allowance paid or made by the Government for transportation of an 
 officer or employee in the performance of his official duties may be 
 more than sufficient to reimburse him for the transportation payment 
 does not prevent the application of the exemjption provision to such 
 payment. 
 
 The exemption provided for applies to amounts paid as fares and 
 to amounts paid for accommodations in parlor or sleeping cars or 
 on vessels in connection with transportation upon which tax is im- 
 posed by subdivision (c), section 500. 
 
 Art. 79. Certificate required when charges paid. — An exemption 
 certificate for property or persons or other evidence of right to ex- 
 emption, must be delivered to the carrier by the person paying the 
 charges when the charges are paid; otherwise there shall be no ex- 
 emption from the tax. 
 
 Art. 80. Prepaid charges. — Where transportation charges, either 
 prepaid or collect, are paid by the shipper at origin of the shipment, 
 or by a contractor at destination of the shipment, upon property 
 shipped to the United States Government or to a State or Territory 
 or the District of Columbia, or to a Government contractor, and the 
 payment of such charges is in behalf of the Government, and the 
 amount paid therefor is borne by the Government, such amounts are 
 not subject to the tax. Exemption certificates properly signed by a 
 governmental officer or employee must be furnished to the carrier 
 as evidence of such rights to exemption.
 
 TAX ON TRANSPORTATION AND OTHER FACILITIES. 33 
 
 Art. 81. Indorsement of certificates. — An exemption certificate 
 signed by a contractor or any person acting temporarily as an agent 
 of the Government in prepaying transportation charges does not fur- 
 nish the required evidence of exemption. All exemption certificates 
 must be signed by a governmental officer or employee. 
 
 Art. 82. Seimrate certificaies. — Exemption certificates must be fur- 
 nished with each consignment. An exemption certificate covering a 
 number of consignments will not be accepted by a carrier. 
 
 Art. 83. Carriers to record and file certifi.cates. — Carriers shall, in 
 accepting exemption certificates and transportation requests, see that 
 they are duly filled out. In accepting any evidence of right to ex- 
 emption, carriers shall note on their records, opposite the entry of 
 the collection, reference to such evidence; they must file and retain in 
 the offices or places where such collections are made, or where records 
 of such collections are kept, all such exemption certificates honored 
 by them. All evidences, and all records of collections of taxes and 
 of charges for transportation, shall be subject to inspection by ac- 
 credited representatives of the Commissioner of Internal Revenue.
 
 PART VII. 
 
 PAYMENT, COLLECTIONS, AND RETURNS PENALTIES. 
 
 PAYMENT, COLLECTION, REPORTING, RETURNING, AND REMIT- 
 TANCE OF THE TAXES— PENALTIES. 
 
 Section 501, subdivision (a), of the act provides: 
 
 That the taxes imposed by section 500 shall be paid by the person paying for 
 the services or facilities i-endered. 
 
 Section 502 of the act provides: 
 
 That each person receiving any payments referred to in section 500 shall 
 collect the amount of the tax, if any, imposed by such section from the person 
 making such payments, and shall make monthly returns under oath, in dupli- 
 cate, and pay the taxes so collected and the taxes Imposed upon it under sub- 
 division (c) or (d) of section 501 to the collector of the district in which the 
 principal office or place of business is located. * * * 
 
 The returns required under this section shall contain such information and be 
 made at such times and in such manner as the Commissioner, with the approval 
 of the Secretary, may by regulation prescribe. 
 
 Art. 84. Payment of taxes. — All taxes imposed by section 500 
 shall be paid by the person from whom or from which the carrier 
 collects the charges for the services or facilities rendered. 
 
 Art. 85. Collection of taxes. — All such taxes shall, as and when 
 the charges are collected, be paid to and collected by the officers, 
 agents, or other employees of the carrier, who collect such charges. 
 
 Art. 8G. Credit arrangements. — When transportation services are 
 rendered by any carrier as described in these regulations and credit 
 is extended by such carrier to the person to whom such services have 
 been rendered, the tax becomes due by the carrier to the Government 
 and such credit is extended at the carrier's risk. In the event of a 
 failure to collect the amounts due, the carrier is liable for the tax 
 which should have been collected upon the amount due for the trans- 
 portation charges. 
 
 Art. 87. Records — Taxes collected. — Eecords of carriers, at their 
 respective agencies at which the tax is collected, shall be so kept as 
 to show the application of the tax to each shipment of property, 
 ticket sold, fare collected, or other individual transaction. 
 
 Art. 88. Records — No taxes collected. — Should any payment for 
 services or facilities of carriers be exempt, under the provisions of 
 84
 
 TAX ON TEANSPORTATION AND OTHER FACILITIES. 35 
 
 Title V, from the tax, or should the tax thereon be collectible under 
 the terms of these regulations by any carrier other than the carrier 
 furnishing the services or facilities, notation shall be made on the 
 records of the carrier furnishing the services or facilities indicating 
 the reason for not collecting the tax. 
 
 Art. 89. Records — Adjustment of taxes. — Since, in the ordinary 
 course of transportation, overcharges and undercharges will occur, 
 officers, agents, and other employees of carriers are authorized, in 
 adjusting such overcharges and undercharges, to adjust the taxes 
 accordingly. All redemptions or other adjustments made in connec- 
 tion with passenger transportation, whether by way of refund on 
 mileage-book covers or otherwise, are to be treated as adjustments of 
 overcharges or undercharges, as the case may be. Nothing in these 
 regulations, however, authorizes an adjustment of a tax by a carrier 
 in any instance where, after collection of a charge and tax, it is 
 claimed that the charge is entitled to exemption from the tax by 
 reason of exportation, governmental use, or otherwise. All adjust- 
 ments of taxes must be recorded. They must be supported by such 
 evidences as will fully substantiate the correctness thereof, and such 
 evidences must be kept in the respective offices through which such 
 adjustments are made. 
 
 Any person making a refund of any payment upon which tax is 
 collected under this section may repay therewith the amount of the 
 tax collected on such payment; and the amount so repaid may be 
 credited against the amount included in any subsequent monthly 
 return. 
 
 Art. 90. Records — Summaries of transactions. — Officers, agents, 
 and other employees of carriers shall cause to be assembled, for each 
 calendar month, at the general office or offices of such carriers, sum- 
 maries, by the several classes of the taxes specified in Form 727, re- 
 vised, showing the aggregate taxes collected by their respective offi- 
 cers, agents, or other employees. There shall likewise be so assembled 
 summaries of all tax adjustments. Such summaries shall show {a) 
 the aggregate taxes of each class collected, as called for by Form 727, 
 revised; and (&) the total amount deducted for adjustment of taxes 
 of each class on account of overcharges, as called for by Form 727, 
 revised. 
 
 The difference between the two items, {a) and (&), shall be the 
 amount to be reported to the proper collector in the manner pre- 
 scribed by form 727, revised. 
 
 Art. 91. Return and vemittance of taxes. — Returns must be made 
 on or before the last day of each month, covering taxes collected or 
 paid during the preceding month. Returns will be made on Form 
 727, revised, under oath, in duplicate, and filed with the collector of
 
 30 TAX ON TEANSPORTATIOiT AND OTHEK FACILITIES. 
 
 the district in which the principal office, or place of business, of the 
 carrier is located. 
 
 The tax is due and pa3'able to the collector at the time fixed for 
 filing the return. AMicre it is found to be impossible to make the 
 proper return within the prescribed time, request may be filed with 
 the collector for an extension of time, and upon a proper showing the 
 collector is authorized to fix a definite time in each instance within 
 which the return may be filed, such extension of time not to exceed 
 sixty (CO) days. 
 
 If the amount of tax covered by any return required to be filed 
 under section 502 is not in excess of $10, the return may be signed 
 or acknowledged before two witnesses instead of under oath. 
 
 Art. 92. Penalties — 
 
 (1) Section 502 of the act specifically provides that the taxes 
 under section 500 shall (without assessment by the Commissioner or 
 notice from the collector) be due at the time fixed for filing this 
 return, and if the tax is not paid at such time there shall be added 
 as part of the tax a penalty of 5 per cent, together with interest at 
 the rate of 1 per cent for each full month from the time when the 
 tax becomes due. 
 
 (2) Sec. 130S. («) That any person required under Titles V, * * * (whicli 
 Includes sections 500, 501, and 502) * * * to pay, or to collect, account for, 
 and pay over any tax, or required by law or regulations made under authority 
 thereof to make a return or supply any information for the purposes of the 
 computation, assessment, or collection of any such tax, who fails to pay, collect, 
 or truly account for and pay over any such tax, make any such return, or supply 
 any such information at the time or times required by law or regulation shall. 
 In addition to other penalties provided by law, be subject to a penalty of not 
 more than $1,000. 
 
 (b) Any person who willfully refuses to pay, collect, or truly account for 
 and pay over any such tax, make such return, or supply such Information at 
 the time or times required by law or regulation, or who willfully attempts in 
 any manner to evade such tax, shall be guilty of a misdemeanor, and in addi- 
 tion to other penalties provided by law shall be fined not more than $10,000 or 
 Imprisoned for not more than one year, or both, together with the costs of 
 prosecution. 
 
 (c) Any person who willfully refuses to pay, collect, or truly account for and 
 pay over any such tax shall, in addition to other penalties provided by law, be 
 liable to a penalty of the amount of the tax evaded, or not paid, collected, or 
 accounted for and paid over, to be assessed and collected in the same manner 
 as taxes are assessed and collected : Provided, lioicevcr, That no penalty shall 
 be assessed under this subdivision for any offense for which a penalty may 
 be assessed under authority of section 317G of the Revised Statutes as 
 amended * * *. 
 
 (d) The term "person" as used in this section includes an officer or em- 
 ployee of a corporation or a member or employee of a partnership who, as such 
 officer, employee, or member, is under a duty to perform the act in respect of 
 which the violati^'u occurs.
 
 TAX ON TEAJSrSPORTATION AND OTHER FACILITIES. 37" 
 
 (3) Section 3176 of the Revised Statutes, as amended, provides 
 that in case of any faihire to make and file a return within the pre- 
 scribed time there shall be added to the tax 25 per cent of its amount. 
 
 (4) Section 3176 of the Revised Statutes, as amended, further 
 provides that in case a false or fraudulent return is willfully made 
 there shall be added to the tax 50 per cent of its amount. 
 
 Daniel C. Roper, 
 Commissioner of Intertml Revenue. 
 
 Approved May 1, 1919 : 
 
 J. H. MOYLE, 
 
 Acting Secretary of the Treasury.
 
 INDEX. 
 
 [References are to articles.] 
 
 Art. 
 
 Accommodations for passengers, free 64 
 
 Accounting for taxes, duty 91 
 
 Additional tickets, for exclusive occupancy of sleeping or parlor compart- 
 ments or sections GO 
 
 Adjustment of overcharges and undercharges 89 
 
 Adjustment : 
 
 Of tax, records 89 
 
 Of tax, summaries 90 
 
 Agencies supported by Government funds, exempt 70, 78 
 
 Agents : 
 
 Duty of, relative to collection of tax on special accommodations 65, 78 
 
 To indorse mileage book sold prior to November 1, 1917 48 
 
 To indorse ticket sold prior to November 1, 1917 45 
 
 Transportation of property of 21, 22 
 
 Selling prepaid orders, collection of tax 53 
 
 Alaska, part of United States 3 
 
 Ambassadors of foreign countries, exempt 73, 78 
 
 Army officers, exempt 72, 78 
 
 Associations, inclusion in " person " 3 
 
 Baggage : 
 
 Excess 56.58 
 
 Storage of 57, 58 
 
 Transportation of, not express business 37 
 
 Sale of unclaimed 32 
 
 Basis of computation of tax where no charge collected 22 
 
 Berths : 
 
 In sleeping car G3, 78 
 
 On vessels 63, 78 
 
 Bill of lading: 
 
 Domestic, exemption of charges on property exported under 15 
 
 Foreign, collection of tax on charges on property imported under 17, 18 
 
 Through, collection of tax on charges on property imported under 17. 18 
 
 Through export, exemption of charges on property exported under 15 
 
 Blocking property in cars, charges for 31 
 
 Boats, chartered 33 
 
 Book form, tickets for transportation of commodities 28 
 
 British Admiralty, as consignee 15 
 
 Bulk, tickets for transportation of commodities in 28 
 
 Canada : 
 
 Cash fares to points in 51 
 
 Exchange orders issued in 54 
 
 Mileage book purchased in 48, 50 
 
 Through bill of lading to, exemption of charges under 15 
 
 89
 
 40 INDEX. 
 
 Canada — Continued. _A^rt. 
 
 Transportation of persons between points in G2 
 
 Transportation of persons from, to Mexico 62 
 
 Transportation of persons from, to United States G2 
 
 Transportation of persons to 38 
 
 Transportation of property exported to 15 
 
 Canal Zone, shipment to, not export 16 
 
 Cargo, trimming of, in vessels — transportation 2 
 
 Carrier : 
 
 Collecting charges collects tax 12 
 
 Collecting charges on behalf of other carriers 12 
 
 Defaiition 1 
 
 Liable in the event of failure to collect tax from person served 86 
 
 Materials and supplies of, transportation of 23, 25 
 
 Motor power 35, 37 
 
 I'aynients by, for towase, not taxable 11 
 
 Payments to, by express companies, not taxable 10 
 
 Services rendered on behalf of, transportation 2 
 
 To assemble summaries of records monthly 90 
 
 To collect tax 85 
 
 To record adjustments . 89, 90 
 
 To record and file certificates of exemption 83 
 
 To record exempt transportation 88 
 
 To record taxes collected 87, 90 
 
 Transporting own property 21, 22, 23, 33 
 
 Cartage of property transported not transportation 2 
 
 Cash and tickets combined 43 
 
 Cash fares, tax on 51 
 
 Certificate : 
 
 Exemption, credentials to 75 
 
 Forms furnished 76 
 
 Indorsement of 81 
 
 Governmental, of persons 72, 76, 79, SO 
 
 Governmental, of property 71, 76, 79, 80 
 
 Must be separate with each consignment 82 
 
 To be recorded and filed 83 
 
 When delivered to carrier 79 
 
 Charges : 
 
 Blocking and staking property in cars 31 
 
 In-transit privileges 13 
 
 No tax where 21,22,36 
 
 On imported property 17, 18 
 
 Property shipped for export 15 
 
 Road and water fall, taxable 9, 10 
 
 Shipment passing through foreign country 20 
 
 State inspection 29 
 
 Storage 80 
 
 Taxable, general rule 4 
 
 Terminal service 14 
 
 Water service 14 
 
 Chartered trains or cars for passengers 61, 63 
 
 Chartered boats 33 
 
 Circus trains, transportation of property and persons 27
 
 INDEX. 41 
 
 Art, 
 
 Cities, inchided in " State " or " Territory " 68 
 
 Collection of tax : 
 
 By carrier collecting charges 12, 34 
 
 By whom 85 
 
 On charges for in-transit privileges 13 
 
 On charges for prepaid ordei's 53 
 
 On charges on imported property 17, 18 
 
 On charges on property for export 15 
 
 On charges for special accommodations for passengers 65,78 
 
 On terminal or water-service charges 14 
 
 Collector, means collector of internal revenue 3 
 
 Combined freight and express services 34 
 
 Combined tickets or cash and. tickets 43 
 
 Commissioner, means Commissioner of Internal Revenue 3 
 
 Commodities : 
 
 Necessary to business of carrier, transportation of 23,25,36 
 
 Transportation of 28 
 
 Commutation tickets 41 
 
 Purchased prior to November 1, 1917 44, 45, 46 
 
 Trips less than 30 miles 41 
 
 Compartments in sleeping or parlor cars, exclusive occupancy of 60 
 
 Competition, when exists 35 
 
 Computation of tax on transportation without charge 22 
 
 Continuous transportation, combination fares 43 
 
 Zone system 42 
 
 Contracts, Government : 
 
 Cost-plus, transportation under 74 
 
 Lump sum, transportation under 77 
 
 Corporations, inclusion in " person " 3 
 
 Corpses 59 
 
 Cost-plus contracts. Government, freight or persons transported under 74 
 
 Counties, included in " State " or " Territory " 68 
 
 Credentials to exemption certificate 75 
 
 Credit arrangements by carrier with person served 8G 
 
 Crude petroleum, transportation by pipe line 66 
 
 Date, effective, of law 1 6, 7 
 
 Date of transportation determines taxability 6, 7 
 
 Dead bodies, transportation of 59 
 
 Definition : 
 
 Carrier 1 
 
 Oil 66 
 
 Territory 68 
 
 State 68 
 
 Person 3 
 
 Regular established line 39 
 
 Transportation 2 
 
 United States 3 
 
 Delivery of property transported — transportation 2 
 
 Diplomatic representatives of foreign governments, exempt 73,78 
 
 Demurrage on properly transj)orted, transportation 2 
 
 Director of overseas transportation, as consignee 15
 
 42 INDEX. 
 
 District of Columbia : Art. 
 
 Exemption of charges on offices and employees 72 
 
 Included in United States 3 
 
 Domestic bill of lading, exemption of i)ropcrty exported under 15 
 
 Domestic sbipment passing through foreign country 20 
 
 Drawing-rooms : 
 
 In sleeping cars or on vessels 63-65 
 
 Exclusive occupancy of 60 
 
 Governmental exemptions 78 
 
 Duplication of tax, no 10 
 
 Effective date of law 6,7 
 
 Eight per cent tax : 
 
 Application, iu general 38 
 
 Cash fares 51 
 
 Charge on chartered car or train 61 
 
 Circus trains 27 
 
 Excess baggage 56, 58 
 
 Mileage-exchange ticket 48 
 
 Seats, berths, or state rooms, in parlor or sleeping cars or on vessels- 63, 78 
 
 Party tickets 52 
 
 Mileage books 48 
 
 Special services to passengers 60 
 
 Storage of baggage 57, 58 
 
 Transportation of oil by pipe line 67 
 
 Elevation of property transported, transportation 2 
 
 Emergency conditions, sale of property under 82 
 
 Employees of Government, Federal, State, and Territory, exempt 72 
 
 Employees of carrier, transportation of property of 21, 22 
 
 Endorsement : 
 
 Showing payment of tax on mileage books sold prior to November 
 
 1, 1917 48 
 
 Showing payment of tax on ticket sold prior to November 1, 1917 45 
 
 Evasion of tax, penalty 92 
 
 Evidence of right to governmental exemption 71, 72 
 
 Excess baggage 56, 58 
 
 Exchange orders 54 
 
 Exclusive occupany of drawing rooms, compartments, or sections 60 
 
 Exemption : 
 
 Carrier transporting own property 21 
 
 Certificates. (See Certificates.) 
 
 Commutation or season tickets for trips less than 30 miles 62 
 
 Foreign ambassadors, ministers, and diplomatic representatives 73 
 
 Freight and p«^sons transported under cost-plus contract 74 
 
 Governmex-ital 68-83 
 
 Governmental, applies to accommodations in parlor or sleeping cars 
 
 and on vessels 78 
 
 Governmental, evidence of right to 71, 72, 73, 74 
 
 Governmental, limited to performance of official duties 78 
 
 Governmental, not affected by payment of mileage by Government 78 
 
 Government agencies_l 70, 78 
 
 Passenger fares less than 42 cents 40, 42, 43, 62 
 
 Payment of 16 cents or less for freight transportation 5 
 
 Persons carried free under Federal oi State laws 62
 
 mDEx. 43 
 
 Biemptlon — Continued. Art. 
 
 Property shipped for exportation __:_r___ 15 
 
 Property for export consigned to — 
 
 Food Administration Grain Corporation [ 15 
 
 Director of Overseas Transportation 15 
 
 Britisli Admiralty 15 
 
 Transportation of commodities necessary to carrier business 23, 25 
 
 Export, cliarges on property sliippetl lor 15 
 
 Export representative, exemption of property for export consigaed-to 15 
 
 Exportation, transportation of property in course of 15 
 
 Express and freight service, combined 34 
 
 Express company : 
 
 Payments to carrier for use of facilities, not taxable 10 
 
 Transportation of commodities necessary to 25, 36 
 
 Express, shipments by 30 
 
 Express shipments, tax imposed on payments by consignor or consignee 10 
 
 Express, transportation by 36-37 
 
 Facilities and services: 
 
 Taxable 8-14 
 
 Payments by express company for use of, not taxable 10 
 
 Used in connection with movement of property or persons, trans- 
 portation 2 
 
 Failure to pay, collect, or truly account for taxes 92 
 
 Failure to file return on time 92 
 
 False or fraudulent return ;_ 92 
 
 Federal control constitutes one railroad system 26 
 
 Federal Farm Appraisers, exempt, Government agency 70 
 
 Federal Land Banks, exempt. Government agency 70 
 
 Federal Reserve Banks, exempt. Government agency 70 
 
 Feeding live stock, transportation 2 
 
 File of certificates of exemption kept by carrier 83 
 
 Food Administration Grain Corporation, United States: 
 
 Exempt, Government agency 70 
 
 As consignee 15 
 
 Foreign bills of lading, tax on charges of property imported under 17 
 
 Foreign countries : 
 
 Transportation of persons to or from 38 
 
 Property passing through, between points in United States 20 
 
 Transportation of persons through, between points in United States. 38 
 Foreign governments : 
 
 Diplomatic representatives exempt 73, 78 
 
 Services to, not exempt 69 
 
 Foreign port : 
 
 Transportation of persons from last port in United States to 02 
 
 Property paasing through United States between 19 
 
 Forms, exemption certificates, furnished 76 
 
 Forty-two cents, exemption of passenger fare less than 40,42,43 
 
 Fractional part of cent, as tax 5 
 
 Free accommodations 64 
 
 Free of charge, transportation of property 21,22,23 
 
 Of persons 62 
 
 Freight and express sei'vices combined 34 
 
 Freiglit, transportation of 0-35
 
 44 INDEX. 
 
 Art. 
 
 Freight transportation, pnymont of IG cents or less, exempt 6 
 
 Fuel Administration, United States, exempt, Government agency 70 
 
 Government agencies, exempt 70, 78 
 
 Government contract : 
 
 Cost-plus, exempt ^ 74 
 
 Liunp sum, taxable 77 
 
 Governmental exemptions 68-83 
 
 Applies to accommodations in parlor or sleeping cars or on vessels 78 
 
 Handling of property transported, transportation 2 
 
 Hawaii : 
 
 Exemption of charges incurred by officials and employees 68, 72 
 
 Tart of United States 3 
 
 Holding corporation, transportation of property of 24 
 
 Hotel accommodations, not transportation 2 
 
 Household goods, movement of, by motor vans 85 
 
 Housing Corporation, United States, exempt. Government agency 70 
 
 Icing of property transported, transportation 2 
 
 Imported property, charges on 17, 18 
 
 Incidental services and facilities, transportation 2 
 
 Indorsement of exemption certificates 81 
 
 Inspection charges. State, not ti"ausportation charges 29 
 
 Inspection of records of carriers 83 
 
 In-transit privileges 13 
 
 Joint use of terminal or yards, commodities necessary for 25 
 
 Land banks, Federal, exempt, Government -agencies 70 
 
 Liberty Loan Committee, exempt. Government agency 70 
 
 Lighterage, transportation 2 
 
 Live stock : 
 
 Export of, on through contract to Mexico or Canada 15 
 
 Feeding and watering of, transportation 2 
 
 Lump-sum contracts. Government, transportation under, taxable 77 
 
 Meals, passengers', not transportation 2 
 
 Materials of ctjrrier, transportation of 23, 25, 36 
 
 Mexico : 
 
 Cash fares to points In 51 
 
 Exchange orders issued in 54 
 
 Mileage book purchased in 48,50 
 
 Through bill of lading to, exempt 15 
 
 Transportation of persons between points in 62 
 
 Transportation of persons from, to United States . 62 
 
 Transportation of persons to . 38 
 
 Transportation of persons from, to Canada 62 
 
 Mileage paid by Government does not affect governmental exemption 78 
 
 Mileage : 
 
 Books 47-50 
 
 Purchased in Canada or Mexico 50 
 
 Refund on covers 89 
 
 Unused, bought prior to November 1, 1917 44, 45, 46 
 
 Milk, transportation of ^ 28 
 
 Motor povv-er, transportation by 35, 37, 38, 39 
 
 Motor vans 35, 37.
 
 INDEX. 45 
 
 Art. 
 
 Municipalities, included in " State " or " Territory " 6S 
 
 Navy, officers, exempt , 72, 78 
 
 Newspapers, transportation of 28 
 
 Official duties, limitation of governmental exemption to 78 
 
 Officers : 
 
 Of Ai-my or Navy, exempt 72, 78 
 
 Of carrier, transportation of property of 21, 22 
 
 Of State, Federal, and Territorial Governments, exempt 72, 78 
 
 Oil: 
 
 Definition »>,«^ 56 
 
 Transportation of, by pipe line ^ 67 
 
 One cent on 20 cents, tax : 
 
 On combined express and freight services S4 
 
 On express shipments 86 
 
 Overchax'ges, adjustment of 89 
 
 Overseas transportation, director of, as consignee 15 
 
 Ownership by carrier of property transported 21 
 
 Panama Canal Zone, shipments to, not export IG 
 
 Panama Railroad Co., exempt, Government agency 70 
 
 Parlor cars : 
 
 Seats, berths, staterooms 63, 78 
 
 Sections or compartments, exclusive occupancy of 60 
 
 Partial use of ticket purchased prior to November 1, 1917 44 
 
 Partnerships, inclusion in " person " 3 
 
 Party tickets, tax on 52 
 
 Passengers : 
 
 Hotel accommodations not transportation 2 
 
 Meals not transportation 2 
 
 Passenger transportation 38-65 
 
 Payment of taxes : 
 
 By whom 84 
 
 Evidence of 45 
 
 Failure to make 92 
 
 Total upon total charges 12 
 
 Penalties 92 
 
 Perishable property, sale of 32 
 
 Person, definition 3 
 
 Persons : 
 
 Movement of, transportation 2 
 
 Transportation of 38-65 
 
 Petroleum, crude, transportation of by pipe lines 66 
 
 Philippine Islands, shipuients to, not export 16 
 
 Pipe line, transportation of oil by 67 
 
 Porto Rico, shipments to, not export 16 
 
 Prepaid charges, on shipments to government 80 
 
 Property : 
 
 Movement of, transportation 2 
 
 Transported, handling of, transportation 2 
 
 Transportation of — • 
 
 By freiglit 6-35 
 
 By express 36, 37
 
 46 INDEX. 
 
 Railroad system: Art. 
 
 Carriers part of same, commodities necessary to 25, 26 
 
 Carriers under Federal control constitute one 26 
 
 Receipt of property transported, transportation 2 
 
 Records : 
 
 Of adjustments kept hy carrier 89, 90 
 
 Of certificates of exemption, kept by carrier 83 
 
 Of exempt transportation, kept by carrier 88 
 
 Summaries of 90 
 
 Of taxes collected, kept by carrier 87, 90 
 
 Transportation requests 83 
 
 Reconsignment of property passing through United States from foreign 
 
 country 19 
 
 Red Cross, American National, exempt, Government agency 70 
 
 Refrigeration of property transported, transportation 2 
 
 Refusal to pay, collect, or truly account for taxes 92 
 
 Regular established line, definition 89 
 
 Remittances : 
 
 Failure to make 92 
 
 When and how made 91 
 
 Request, transportation, form 72 
 
 Returns, when and how made 91 
 
 Revised Statutes, section 8176, as amended 92 
 
 Road haul charge, taxable, when 9, 10 
 
 Round-trip ticket 40 
 
 Bale : 
 
 Of perishable property 32 
 
 Of property under emergency 32 
 
 Of unclaimed property , 82 
 
 Season tickets . , 41 
 
 Sale prior to November 1, 1917 . . 44 
 
 Secretary, means Secretary of Treasury 3 
 
 Separate certificates with each consignment 82 
 
 Services and facilities taxable 8-14 
 
 Services rendered in connection with movement of property or persons, 
 
 transportation 2 
 
 Shipping Board Emergency Fleet Corporation, United States, exempt, 
 
 Government agency 70 
 
 Sixteen cents or less, payment for freight transportation, exemption 5 
 
 Sleeping car : 
 
 Seats, berths, or staterooms 63, 78 
 
 Sections or compartments, exclusive occupancy of_ 60 
 
 Soldier traveling on furlough, not exempt 78 
 
 Special accommodations for passengers 63, 78 
 
 Special cars or trains for passengers 61 
 
 Special services to passengers 60 
 
 Staking property in cars, charges for 81 
 
 State : 
 
 Definition 68 
 
 Exemption of charges Incurred by oflicers or employees of 68, 72 
 
 Inspection charges, not transportation charges 29 
 
 Stateroom on vessel or sleeping or parlor car 63, 78 
 
 Steamers, sleeping or parlor accommodations on 60, 63
 
 INDEX. 47 
 
 Art. 
 
 Steamship orders 55 
 
 Stock of cue corporation owned by anotlier, effect of 24 
 
 Storage : 
 
 Of property transported, transportation 2 
 
 Of baggage 57, 58 
 
 Cliarges _, 30 
 
 Subsidiary corporation, transportation of property of 24 
 
 Summaries of transactions by carrier 90 
 
 Supplies of carrier, transportation of 23, 25, 36 
 
 Switching company, facilities furnished for or by 25 
 
 System: 
 
 Railroad, all carriers under Federal control in one 26 
 
 Carriers part of same ; 25, 26 
 
 Telegraph company, transportation of commodities necesstiry to 25 
 
 Telephone company, transportation of commodities necessary to 25 
 
 Terminal company, transportation of commodities necessary to 25 
 
 Terminal service 14 
 
 Territory : 
 
 Definiton 68 
 
 Exemption of charges incurred by officers and employees of 68, 72 
 
 Thirty miles, trips less than 41 
 
 Three per cent tax : 
 
 On circus trains 27 
 
 On combined express and freight services 34 
 
 On transportation of milk, newspapers, and commodities 28 
 
 Through transportation, between foreign ports 19 
 
 Through United States: 
 
 Transportation between points in Canada or Mexico 62 
 
 Exchange orders issued in connection with 54 
 
 Tickets : 
 
 Additional, for exclusive occupancy of sleeping or parlor car com- 
 partments or sections 60 
 
 Combination of 43 
 
 For transportation of commodities, in book form or bulk 28 
 
 Round trip 40 
 
 Unused, when bought prior to November 1, 1917 44, 45, 46 
 
 Towage charges, when taxable 11 
 
 Towage of property transported, transportation L' 
 
 Towns, included in " State " or " Territory " 65; 
 
 Training Camp Activities, Commission on, exempt, Government agency • 70 
 
 Transfer in transit of property transported, transportation 2 
 
 Transportation : 
 
 Completed prior to November 1, 1917 7 
 
 Date of, determine tax 6, 7 
 
 Defaiition 2 
 
 Transportation requests, form 72 
 
 Trimming of cargo in vessels, transportation 2 
 
 Trips less than 30 miles 40 
 
 Under charges, adjustment of 89 
 
 United States : 
 
 Definition 3 
 
 Property passing through 19
 
 48 INDEXi 
 
 Art. 
 Unclaimed property, sale of 32 
 
 Unused mileage books, bought prior to November 1, 1917 44, 45, 46 
 
 Unused tii-kets, bouirht prior to November 1, 1917 44,45,40- 
 
 Vans, motor 35 
 
 A'entilation of property transported, transportation 2 
 
 A'essels, trinnning of cargo in. transportation 2 
 
 Virgin Islands, shipments to, not export 16 
 
 War Savings Connuittee, exempt, (Jovernment agency 70 
 
 Water-haul charge, taxable, when 9, 10 
 
 War Industries Board, exempt, Government agency 70 
 
 Water service 14 
 
 Watering live stock, transportation 2 
 
 AVharfage of property transported, transportation 2 
 
 Zone system of collecting fares 42 
 
 o 
 
 LAW LIBRARY 
 UNIVERSITY OF GALH'ORNU
 
 Manufoctured by 
 
 GAYLORD BROS. Inc. ; 
 
 Syracuse, N.Y. , 
 
 Stockton, Calif. i 
 
 UCSOUTHlfvi KlhiULAL JBRA1C> fACILlTY 
 
 AA 000 348 752