230207 CCMC Comments Improvementsto Income Tax Disclosure FASB

Watson M. McLeish Watson M. McLeish
Senior Vice President, Tax Policy
Tom Quaadman Tom Quaadman
Executive Vice President, Center for Capital Markets Competitiveness (CCMC), U.S. Chamber of Commerce
Executive Vice President, Center for Technology Engagement (C_TEC), U.S. Chamber of Commerce
Executive Vice President, Global Innovation Policy Center (GIPC), U.S. Chamber of Commerce
Senior Advisor to the President and CEO, U.S. Chamber of Commerce


February 08, 2023


Mr. Richard R. Jones
Financial Accounting Standards Board
801 Main Avenue
Norwalk, CT 06851

Re: Improvements to Income Tax Disclosures

Dear Chair Jones:

While the U.S. Chamber of Commerce (“Chamber”) supports the Financial Accounting Standards Board (“FASB”) in its mission to develop standards of financial reporting that provide investors with material decision-useful information, we have serious concerns with the FASB project entitled “Improvements to Income Tax Disclosures.” In particular, we are concerned about the materiality of the disaggregated information the project seeks to disclose and the role of activists in seeking to use this information to vilify firms and deter investments.

This project is not driven by a compelling need. A significant amount of income tax information is already disclosed in the financial statements and footnotes for investors. More granular tax information is reported to relevant domestic and foreign government agencies to ensure compliance. Financial disclosures facilitating investment decisionmaking and confidential tax compliance information are different—and mutually exclusive—propositions.

In recent years, non-investor activists have agitated for information regarding business tax payments, on a domestic and global level, in efforts to imply wrongdoing by firms who are in full compliance with the tax laws and regulations of relevant jurisdictions. This was highlighted in a recent Politico Pro article:

“For sure, this would be used by the tax planning shamers,” said Jeff Hoopes, an accounting professor at the University of North Carolina.1

FASB should reject such an approach and draw guidance from the U.S. Court of Appeals for the D.C. Circuit’s holding in National Association of Manufacturers, et al. v. Securities and Exchange Commission, 800 F.3d 518 (D.C. Cir. 2015), that disclosures designed to shame a business constitute compelled speech that violates the First Amendment.

The Chamber is concerned that recent demands for increased income tax disclosures derive from a politically driven narrative—namely, that corporations do not “pay their fair share”—and are not based on an investor mandate. Disseminating information that is more governmental in purpose—and that is already being reported to the government—is the province of federal regulators and Congress, not FASB. Furthermore, FASB should disclose those with whom it has consulted on this project. This basic level of transparency is important to understand the nature and scope of the recommendations influencing FASB’s position.

We understand that FASB is considering issuing a proposal in the first quarter of 2023 to expand both the quantitative and qualitative information disclosed by companies on matters related to income taxes. As the Board deliberates on this project, we hope that it will take these concerns into consideration. Additionally, we hope that FASB will be willing to meet with the business community to have a dialogue on the project and potential concerns if an exposure draft is released.


Tom Quaadman
Executive Vice President
Center for Capital Markets Competitiveness
U.S. Chamber of Commerce

Watson M. McLeish
Senior Vice President,
Tax Policy
U.S. Chamber of Commerce

cc: Jim Kroeker, Vice Chairman, Financial Accounting Standards Board
Christine Ann Botosan, Board Member
Gary R. Buesser, Board Member
Frederick L. Cannon, Board Member
Susan M. Cosper, Board Member
Marsha L. Hunt, Board Member
Hillary H. Salo, Technical Director

1 Brian Faler, Corporations face a show-and-tell on their overseas taxes, Politico Pro (Jan. 25, 2023), https://subscriber.politicopro.com/article/2023/01/corporations-face-a-show-and-tell-on-their-overseas-taxes-00079236

230207 CCMC Comments Improvementsto Income Tax Disclosure FASB

About the authors

Watson M. McLeish

Watson M. McLeish

Watson McLeish is senior vice president for Tax Policy at the U.S. Chamber of Commerce, where he serves as the primary adviser on all tax policy-related matters.

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Tom Quaadman

Tom Quaadman

Tom Quaadman develops and executes strategic policies to implement a global corporate financial reporting system, address ongoing attempts of minority shareholder abuse of the proxy system, communicate the benefits of efficient American capital markets, and promote an innovation economy and the long-term interests of all investors.

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