Executive Order 11766—Modifying Rates of Interest Equalization Tax

WHEREAS I have determined that the rates of tax prescribed under section 1 of Executive Order No. 11754 of December 26, 1973, with respect to acquisitions of stocks of foreign issuers and debt obligations of foreign obligors made after December 31, 1973, are higher than the rates of tax necessary to limit the acquisitions by United States persons of stocks of foreign issuers, and debt obligations of foreign obligors within a range consistent with the balance-of-payments objectives of the United States:

Now, THEREFORE, by virtue of the authority vested in me by section 4911(b) (2) of the Internal Revenue Code of 1954, and as President of the United States, it is hereby ordered as follows:

SECTION 1. Section 1 of Executive Order No. 11464 of April 3, 1969, as amended, is hereby amended to read as follows:

"Section 1. Rates of Tax.

"(a) Rates applicable to acquisitions of stock. The tax imposed by section 4911 of the Internal Revenue Code of 1954 on the acquisition of stock shall be equal to zero percent of the actual value of the stock.

"(b) Rates applicable to acquisitions of debt obligations. The tax imposed by section 4911 of the Internal Revenue Code of 1954 on the acquisition of a debt obligation shall be equal to zero percent of the actual value of the debt obligation measured by the period remaining to its maturity."

SEC. 2. With respect to acquisitions of stock of foreign issuers and debt obligations of foreign obligors made under the rules of a national securities exchange registered with the Securities and Exchange Commission or under the rules of the National Association of Securities Dealers, Inc., this Order shall be effective for acquisitions made after January 29, 1974, but only if the trade date was after January 29, 1974. In the case of other acquisitions of stock of foreign issuers and debt obligations of foreign obligors, this Order shall be effective for acquisitions made after January 29, 1974.

RICHARD NIXON

The White House,

January 29, 1974.