Aircraft: contract requirements

§ 2382. Aircraft: contract requirements (a) The Secretary of a military department may not contract for the manufacture of all or part of any complete aircraft, unless the contractor agrees— (1) to report under oath to the Secretary, when the contract is completed, as prescribed in subsection (b); (2) to pay any excess profit into the Treasury; (3) to make no division of any contract or subcontract for the same article for the purpose of evading this section; (4) that the books and manufacturing spaces of its plant, affiliates, and divisions may at any time be audited and inspected, respectively, by any person designated by the Secretary of the military department concerned, the Secretary of the Treasury, or an authorized committee of Congress; and (5) to make no subcontract unless the subcontractor agrees to the conditions set forth in this subsection. (b) The report required under subsection (a) (1) shall be in the form prescribed by the Secretary of the military department concerned. It shall state the total contract price, the cost of performing the contract, the net profit or loss, and the percentage of the contract price that is net profit or loss. A copy shall be sent to the Secretary of the Treasury to be considered with the Federal income tax returns of the contractor. (c) For the purposes of this section, “excess profit” means so much of the profits as the Secretary of the Treasury determines to 137be greater than 12 percent of the total contract price for contracts covered by this section and completed by a contractor or subcontractor within the taxable year. The method of computing excess profits shall be determined by the Secretary of the Treasury in agreement with the Secretary of the military department concerned. It shall be made available to the public. (d) When an excess profit is found owing, the Secretary of the Treasury shall allow credit for any Federal income taxes paid or to be paid on the excess profit. If a contractor or subcontractor has a net loss, or a net profit of less than 12 percent, on the aggregate of contracts or subcontracts covered by this section and completed in a taxable year, the deficiency shall be allowed as a credit against any excess profit for the next succeeding four taxable years. (e) When paid into the Treasury, an excess profit becomes the property of the United States. The surety under the contract is not liable for its payment. (f) This section applies to any division of a contract or subcontract covered by this section. (g) This section does not apply to— (1) a contract or subcontract for scientific equipment for communications, target detection, navigation, or fire control if the Secretary of the military department concerned designates the contract or subcontract for exemption; or (2) a contract or subcontract, or division thereof, if the amount involved is $10,000 or less.