Dear Secretary O’Neill and Chairman Pitt:
The nation’s workers and small shareholders have been shaken by the almost dailyrevelations of corruption and malfeasance in corporate boardrooms. My own state of Iowa hasthousands of employees whose employment at WorldCom has now been placed under a shadow.
I am writing to raise the question of whether the information contained in the corporate taxreturns of publicly traded companies could be of benefit to government regulators as well asshareholders and workers. Given recent events, it is important that we have a thoughtful discussionof this matter. Specifically, would there be a benefit to efforts to police corporate governance andproviding a more accurate picture of a corporation’s financial health of requiring corporate taxreturns (or a summary version) to be available to the Securities and Exchange Commission (SEC)?
In addition, would there be a benefit to shareholders and employees of requiring corporate tax returns(or a summary version) to be publicly available?
I recognize the need to balance the benefits of greater openness with possible pitfalls. Forinstance, proprietary business data would understandably need to be safeguarded. To that end, Iwould appreciate your highlighting any drawbacks you see to such a proposal (example, legitimateconcerns of business planning) with possible solutions or responses to those concerns (example,providing to the public a summary that will be informative but will still protect confidential businessinformation).
In addition, I would appreciate your views on whether sufficient tax information is alreadypublicly available. Commentators have stated that the tax puzzle of a corporation can be put togetherfrom SEC filings, annual reports, etc. However, we saw with the Enron Corp. many analystsproviding an estimate of taxes paid, or not paid, that were wildly contradictory.
Thank you for your time and assistance in this matter. Given the Senate’s debate on thesematters, I would appreciate a response within 14 days. If you have any questions, please contact Mr.Dean Zerbe of my staff at (202) 224-5315.
Cordially yours,
Charles E. Grassley Ranking Member
cc: Chairman Baucus
