﻿THE PRESENT

4i

were met by short-term borrowings in the form of
six successive certificates of indebtedness to a nomi-
nal aggregate of $2,320,493,000. Of these the first
three were under the authority conferred by the
First Liberty Loan act, and the last three under
that conferred by the Second Liberty Loan act. A
less evident but practically more important dis-
tinction is that after the first issue (August 9,
1917), the method of payment by credit came into
increasing use by subscribing banks in settlement
of certificates allotted.

(D)	Despite a huge available balance conse-
quent upon the heavy over-payment of the first in-
stallment on account of the Second Liberty Loan,
the Treasury resumed short-term borrowings in the
last week of November, 1917. The expedient then
adopted was a further use of certificates of in-
debtedness, this time in anticipation of the proceeds
of war income and excess profits taxes payable in
June, 1918.

Authorization for this procedure had been con-
ferred by a provision18 of the war revenue act of
October 3, 1917, empowering collectors of internal
revenue to receive at oar and accrued interest cer-
tificates of indebtedness issued under the First Lib-
erty Loan act in payment of income and excess
profits taxes for “ such time and under such regu-
lations as the Commissioner of Internal Revenue,
with the approval of the Secretary of the Treasury,
shall prescribe.”

The reason formally assigned for this tax-antici-

18 Section 1010.