The Revenue Act of 1940 permanently increased individual income tax rates in the United States, permanently increased corporate tax rates from 19% to 33% and temporarily increased most excise tax rates to 30-50%. The personal exemption fell from $2,500 to $2,000 (married couples).
Tax on corporations
Normal tax
A Normal Tax was levied on the net income of corporations as shown in the following table.
{| class="wikitable" style="text-align:center;"
|-
|colspan="4"| Revenue Act of 1940<br />Tax on Corporations<br />
|-
| Net Income<br />(dollars)
| Rate<br />(percent)
|-
| 0 || 19
|-
| 25,000 || 33
|}
Tax on individuals
A normal tax and a surtax were levied against the net income of individuals as shown in the following table.
{| class="wikitable" style="text-align:center;"
|-
|colspan="4"| Revenue Act of 1940<br />Normal Tax and Surtax on Individuals<br />
|-
| Net Income<br />(dollars)
| Normal Rate<br />(percent)
| Surtax Rate<br />(percent)
| Combined Rate<br />(percent)
|-
| 0 || 4 || 0 || 4
|-
| 4,000 || 4 || 4 || 8
|-
| 6,000 || 4 || 6 || 10
|-
| 8,000 || 4 || 8 || 12
|-
| 10,000 || 4 || 10 || 14
|-
| 12,000 || 4 || 12 || 16
|-
| 14,000 || 4 || 15 || 19
|-
| 16,000 || 4 || 18 || 22
|-
| 18,000 || 4 || 21 || 25
|-
| 20,000 || 4 || 24 || 28
|-
| 22,000 || 4 || 27 || 31
|-
| 26,000 || 4 || 30 || 34
|-
| 32,000 || 4 || 33 || 37
|-
| 38,000 || 4 || 36 || 40
|-
| 44,000 || 4 || 40 || 44
|-
| 50,000 || 4 || 44 || 48
|-
| 60,000 || 4 || 47 || 51
|-
| 70,000 || 4 || 50 || 54
|-
| 80,000 || 4 || 53 || 57
|-
| 90,000 || 4 || 56 || 60
|-
| 100,000 || 4 || 58 || 62
|-
| 150,000 || 4 || 60 || 64
|-
| 200,000 || 4 || 62 || 66
|-
| 250,000 || 4 || 64 || 68
|-
| 300,000 || 4 || 66 || 70
|-
| 400,000 || 4 || 68 || 72
|-
| 500,000 || 4 || 70 || 74
|-
| 750,000 || 4 || 72 || 76
|-
| 1,000,000 || 4 || 73 || 77
|-
| 2,000,000 || 4 || 74 || 78
|-
| 5,000,000 || 4 || 75 || 79
|}
- An exemption of $800 for single filers and $2,000 for married couples and heads of family was allowed, as was a $400 exemption for each dependent under 18.