Canada (probably due to its' size and the large quantity of WarTax stamps needed) was the only country that had "War Tax" as part of the stamps design; all other nations (most of which where smaller islands in the British Commonwealth simply resorted to overprinting existing issues, which was less expensive than having new designs created.
I myself have exhibited WarTax stamps on cover (buying the mint stamps is easy and cheap, finding them used on covers or postcards is not...); see my WarTax page at http://wartaxstamps.webs.com
The proceeds of the WarTax were primarily to help defray expenses incurred due to the war; some of the Caribbean islands used it to help pay for the expenses of their "contingents" (ie: the troops that they provided), Bermuda for the loss of their tourist trade when the USA entered the war, Turks & Caicos for loss of revenue due to a reduction in the export of crops, etc (info taken from John Davis' "War Tax Stamps of the British Empire First World War).