I 

118TH CONGRESS 

1ST SESSION H. R. 5428 

To amend the Internal Revenue Code of 1986 to end the tax subsidy for 

employer efforts to influence their workers’ exercise of their rights around 

labor organizations and engaging in collective action. 

IN THE HOUSE OF REPRESENTATIVES 

SEPTEMBER 13, 2023 

Mr. NORCROSS (for himself, Ms. BARRAGA ́N, Mrs. BEATTY, Ms. BLUNT

ROCHESTER, Ms. BONAMICI, Mr. BOWMAN, Ms. BUDZINSKI, Mr. CARSON, Mr. CASAR, Mr. CASTEN, Ms. CLARKE of New York, Mr. CLEAVER, 

Mr. CONNOLLY, Mr. COURTNEY, Ms. CRAIG, Mr. CROW, Mr. CUELLAR, 

Mr. DAVIS of Illinois, Ms. DEAN of Pennsylvania, Ms. DELAURO, Mr. 

DELUZIO, Mr. DESAULNIER, Mrs. DINGELL, Mr. DOGGETT, Mr. 

ESPAILLAT, Mr. EVANS, Mr. FOSTER, Mr. FROST, Mr. GALLEGO, Mr. 

GARAMENDI, Ms. GARCIA of Texas, Mr. GARCI ́A of Illinois, Mr. ROBERT

GARCIA of California, Mr. GOLDEN of Maine, Mr. GOLDMAN of New 

York, Mr. GOMEZ, Mr. GOTTHEIMER, Mr. GREEN of Texas, Ms. HOYLE

of Oregon, Ms. JACKSON LEE, Ms. JAYAPAL, Ms. KAPTUR, Mr. KHANNA, 

Mr. KILDEE, Mr. KIM of New Jersey, Mr. KRISHNAMOORTHI, Ms. 

KUSTER, Mr. LARSEN of Washington, Ms. LEE of California, Ms. LOFGREN, Mr. LYNCH, Mr. MAGAZINER, Ms. MCCOLLUM, Mr. MCGARVEY, 

Mr. MCGOVERN, Mr. MENENDEZ, Mr. MOULTON, Mr. MRVAN, Mr. 

MULLIN, Mr. NADLER, Mrs. NAPOLITANO, Mr. NEGUSE, Mr. NICKEL, 

Ms. NORTON, Ms. OCASIO-CORTEZ, Ms. OMAR, Mr. PALLONE, Mr. PANETTA, Mr. PASCRELL, Mr. PHILLIPS, Ms. PINGREE, Mr. POCAN, Ms. 

PORTER, Ms. PRESSLEY, Mr. QUIGLEY, Mr. RASKIN, Ms. SA ́NCHEZ, Mr. 

SARBANES, Ms. SCANLON, Ms. SCHAKOWSKY, Mr. SCHIFF, Mr. SHERMAN, Ms. SHERRILL, Ms. SLOTKIN, Mr. SMITH of Washington, Mr. 

SORENSEN, Mr. SOTO, Ms. STANSBURY, Mrs. SYKES, Mr. TAKANO, Ms. 

TITUS, Ms. TLAIB, Ms. TOKUDA, Mr. TONKO, Mrs. TRAHAN, Mr. TRONE, 

Ms. UNDERWOOD, Mr. VEASEY, Ms. VELA ́ZQUEZ, Ms. WATERS, Mrs. 

WATSON COLEMAN, Ms. WILD, Ms. WILLIAMS of Georgia, Ms. WILSON

of Florida, Mr. TORRES of New York, Mrs. FOUSHEE, Ms. LOIS

FRANKEL of Florida, Ms. WASSERMAN SCHULTZ, and Mr. FITZPATRICK) 

introduced the following bill; which was referred to the Committee on 

Ways and Means 


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A BILL 

To amend the Internal Revenue Code of 1986 to end the 

tax subsidy for employer efforts to influence their workers’ exercise of their rights around labor organizations 

and engaging in collective action. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘No Tax Breaks for 

5 Union Busting (NTBUB) Act’’. 

6 SEC. 2. FINDINGS. 

7 Congress makes the following findings: 

8 (1) The National Labor Relations Act (29 

9 U.S.C. 151 et seq.) declares that it is the right of 

10 employees to form, join, or assist labor organiza11 tions. 

12 (2) The National Labor Relations Act further 

13 declares that it is ‘‘the policy of the United States 

14 to eliminate the causes of certain substantial ob15 structions to the free flow of commerce and to miti16 gate and eliminate these obstructions when they 

17 have occurred by encouraging the practice and pro18 cedure of collective bargaining and by protecting the 

19 exercise by workers of full freedom of association, 

20 self-organization, and designation of representatives 

21 of their own choosing . . .’’. 


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1 (3) Despite Congress’ intention to give workers 

2 full agency in these matters, many employers regu3 larly choose to involve themselves, lawfully or unlaw4 fully, in the decisions of their employees about 

5 whether to avail themselves of their rights under the 

6 National Labor Relations Act and the Railway 

7 Labor Act (45 U.S.C. 151 et seq.). 

8 (4) Employers frequently violate labor laws 

9 around organizing and collective action. The Eco10 nomic Policy Institute finds that in approximately 4 

11 of 10 labor organization elections in 2016–2017 em12 ployers were charged with committing an unfair 

13 labor practice. Among larger bargaining units of 61 

14 employees or more, over 54 percent of elections have 

15 an unfair labor practice charge. 

16 (5) In practice, these unfair labor practices 

17 often include charges such as employees being ille18 gally fired for labor organization activity, refusal to 

19 bargain in good faith with labor organizations, or co20 ercion and intimidation. Employers also frequently 

21 use captive audience meetings, workplace surveil22 lance, and other lawful or unlawful tactics to sway 

23 labor organization elections. 

24 (6) Whether or not there are charges of unlaw25 ful behavior, employers spend millions of dollars to 


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1 sway the opinions of their employees with respect to 

2 whether or how to exercise their rights under the 

3 National Labor Relations Act and the Railway 

4 Labor Act. According to the Economic Policy Insti5 tute, companies spent $340,000,000 yearly on out6 side consultants to sway their workers’ opinions 

7 about labor organization activities. This and other 

8 spending interfere with the United States goal of 

9 ‘‘encouraging the practice and procedure of collective 

10 bargaining’’. 

11 (7) The Internal Revenue Code of 1986 has 

12 long recognized that spending by businesses with the 

13 purpose of influencing the general public with re14 spect to elections, while it may be lawful, is not tax 

15 deductible. Congress should extend that principle to 

16 spending done by employers to influence workers’ 

17 elections and collective bargaining decisions. These 

18 free choices to exercise the rights to engage in collec19 tive bargaining, labor organization representation, 

20 and other lawful collective activities should be made 

21 without taxpayer subsidies of undue outside influ22 ence from employers. 


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1 SEC. 3. DENIAL OF DEDUCTION FOR ATTEMPTING TO IN2 FLUENCE EMPLOYEES WITH RESPECT TO 

3 LABOR ORGANIZATIONS OR LABOR ORGANI4 ZATION ACTIVITIES. 

5 (a) IN GENERAL.—Section 162(e)(1) of the Internal 

6 Revenue Code of 1986 is amended by striking ‘‘or’’ at the 

7 end of subparagraph (C), by striking the period at the end 

8 of subparagraph (D) and inserting ‘‘, or’’, and by adding 

9 at the end the following new subparagraph: 

10 ‘‘(E) any attempt to influence the tax11 payer’s employees with respect to labor organi12 zations or labor organization activities, includ13 ing with respect to the opinion of such employ14 ees regarding such organizations or activities.’’. 

15 (b) LABOR ORGANIZATIONS; LABOR ORGANIZATION

16 ACTIVITIES DEFINED.—Section 162(e) of the Internal 

17 Revenue Code of 1986 is amended by redesignating para18 graph (6) as paragraph (7) and by inserting after para19 graph (5) the following new paragraph: 

20 ‘‘(6) LABOR ORGANIZATIONS AND LABOR ORGA21 NIZATION ACTIVITY DEFINED.—For purposes of this 

22 subsection— 

23 ‘‘(A) LABOR ORGANIZATION.—The term 

24 ‘labor organization’ has the meaning given such 

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1 porting and Disclosure Act of 1959 (29 U.S.C. 

2 402). 

3 ‘‘(B) LABOR ORGANIZATION ACTIVITY.— 

4 ‘‘(i) IN GENERAL.—The term ‘labor 

5 organization activity’ means labor organi6 zation elections, labor disputes, collective 

7 actions, and such other related activities 

8 identified by the Secretary. 

9 ‘‘(ii) OTHER TERMS.—For purposes of 

10 clause (i)— 

11 ‘‘(I) COLLECTIVE ACTION.—The 

12 term ‘collective action’ means any ac13 tion, including collective bargaining, 

14 described in section 7 of the National 

15 Labor Relations Act (29 U.S.C. 157) 

16 or any action that is a right of em17 ployees or labor organizations under 

18 the Railway Labor Act (45 U.S.C. 

19 151 et seq.). 

20 ‘‘(II) LABOR DISPUTE.—The 

21 term ‘labor dispute’ has the meaning 

22 given such term under section 3 of the 

23 Labor-Management Reporting and 

24 Disclosure Act of 1959 (29 U.S.C. 

25 402). 


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1 ‘‘(III) LABOR ORGANIZATION

2 ELECTION.—The term ‘labor organi3 zation election’ means any election de4 scribed in section 9 of the National 

5 Labor Relations Act (29 U.S.C. 159) 

6 or section 2 of the Railway Labor Act 

7 (45 U.S.C. 152).’’. 

8 (c) SPECIAL RULES.— 

9 (1) IN GENERAL.—Section 162(e)(4) of the In10 ternal Revenue Code of 1986 is amended by adding 

11 at the end the following new subparagraph: 

12 ‘‘(D) EXPENSES RELATING TO LABOR OR13 GANIZATIONS OR LABOR ORGANIZATION ACTIVI14 TIES.— 

15 ‘‘(i) IN GENERAL.—For purposes of 

16 paragraph (1)(E), amounts paid or in17 curred in connection with attempting to in18 fluence the taxpayer’s employees with re19 spect to labor organizations or labor orga20 nization activities include— 

21 ‘‘(I) any amount paid or incurred 

22 directly or indirectly by the taxpayer, 

23 including wages and other general and 

24 administrative costs, in connection 

25 with an action that results in— 


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1 ‘‘(aa) a complaint issued 

2 under section 10 of the National 

3 Labor Relations Act (29 U.S.C. 

4 160) against the taxpayer for an 

5 unfair labor practice under sec6 tion 8(a) of such Act (29 U.S.C. 

7 158(a)), 

8 ‘‘(bb) a settlement offer re9 lated to an investigation by the 

10 National Labor Relations Board 

11 of a charge of an unfair labor 

12 practice under section 8(a) of 

13 such Act (29 U.S.C. 158(a)) that 

14 results in a settlement of such 

15 charge without issuance of a 

16 complaint under section 10 of 

17 such Act (29 U.S.C. 160), or 

18 ‘‘(cc) a finding of inter19 ference, influence, or coercion by 

20 a Federal court under section 2 

21 of the Railway Labor Act (45 

22 U.S.C. 152), 

23 ‘‘(II) any amount paid or in24 curred directly or indirectly by the 

25 taxpayer, including wages and other 


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1 general and administrative costs, in 

2 producing, conducting, or attending 

3 any meeting or training— 

4 ‘‘(aa) which includes employ5 ees of the taxpayer who are or 

6 who could become members of a 

7 unit appropriate for the purposes 

8 of collective bargaining, and 

9 ‘‘(bb) at which labor organi10 zations or a labor organization 

11 activity is discussed, and 

12 ‘‘(III) any amount which is re13 quired to be reported under the 

14 Labor-Management Reporting and 

15 Disclosure Act of 1959 (29 U.S.C. 

16 401 et seq.). 

17 ‘‘(ii) EXCEPTIONS.—The following 

18 amounts shall not be treated as amounts 

19 paid or incurred in connection with at20 tempting to influence the taxpayer’s em21 ployees with respect to labor organizations 

22 or labor organization activities under para23 graph (1)(E): 

24 ‘‘(I) Amounts paid or incurred 

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1 rectly with the designated or selected 

2 representative of the employees of the 

3 taxpayer described in section 9(a) of 

4 the National Labor Relations Act (29 

5 U.S.C. 159(a)) or under the Railway 

6 Labor Act (45 U.S.C. 151 et seq.). 

7 ‘‘(II) Amounts paid or incurred 

8 for communications directly with 

9 shareholders, as may be required 

10 under section 13 of the Securities Ex11 change Act of 1934 (15 U.S.C. 78m). 

12 ‘‘(III) Amounts paid or incurred 

13 for communications or consultations 

14 by the taxpayer in the process of vol15 untarily recognizing a labor organiza16 tion as a representative in accordance 

17 with section 9 of the National Labor 

18 Relations Act (29 U.S.C. 159). 

19 ‘‘(IV) Amounts paid or incurred 

20 with respect to the operation of a 

21 labor-management partnership de22 scribed in a collective bargaining 

23 agreement in effect between a rep24 resentative of employees of the tax25 payer and the taxpayer, including a 


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1 labor management committee estab2 lished pursuant to section 205A(a) of 

3 the Labor Management Relations Act, 

4 1947 (29 U.S.C. 175a(a)). 

5 ‘‘(V) Amounts paid or incurred 

6 for communications or consultations 

7 related to the operation of a grievance 

8 procedure described in a collective 

9 bargaining agreement in effect be10 tween a representative of employees of 

11 the taxpayer and the taxpayer. 

12 ‘‘(VI) Amounts paid or incurred 

13 by a labor organization. 

14 ‘‘(VII) Amounts paid or incurred 

15 for communication materials, includ16 ing visual or audio media, required to 

17 be posted for, or provided to, employ18 ees of the taxpayer by law, including 

19 under the National Labor Relations 

20 Act (29 U.S.C. 151 et seq.) or the 

21 Railway Labor Act (45 U.S.C. 151 et 

22 seq.). 

23 ‘‘(VIII) Amounts paid or in24 curred relating to a complaint which 

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1 tions Board and which is set aside in 

2 full in accordance with subsection (e) 

3 or (f) of section 10 of such Act.’’. 

4 (2) REGULATORY AUTHORITY.— 

5 (A) IN GENERAL.—Section 162(e) of such 

6 Code, as amended by subsection (b), is amend7 ed by redesignating paragraph (7) as paragraph 

8 (8) and by inserting after paragraph (6) the 

9 following new paragraph: 

10 ‘‘(7) REGULATIONS.—The Secretary shall pre11 scribe such guidance, rules, or regulations as are 

12 necessary to carry out the purposes of this sub13 section, including rules relating to the timing of any 

14 deductions in connection with amounts described in 

15 paragraph (4)(D)(ii)(VIII).’’. 

16 (B) TIMING.—Not later than the date that 

17 is 240 days after the date of the enactment of 

18 this Act, the Secretary of the Treasury (or the 

19 Secretary’s delegate) shall prescribe guidance, 

20 rules, or regulations with respect to the applica21 tion of the amendments made by this Act. 

22 (d) INFORMATION REPORTING.— 

23 (1) CERTAIN INFORMATION INCLUDED IN TAX

24 RETURNS.— 


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1 (A) IN GENERAL.—Part I of subchapter B 

2 of chapter 68 is amended by adding at the end 

3 the following new section: 

4 ‘‘SEC. 6720D. FAILURE TO INCLUDE CERTAIN INFORMATION 

5 WITH RESPECT TO EMPLOYER ACTIVITIES 

6 RELATING TO LABOR ORGANIZATIONS. 

7 ‘‘(a) IN GENERAL.—If any taxpayer who makes ex8 penditures described in section 162(e)(1)(E) fails to pro9 vide with the return of tax for the taxable year to which 

10 such expenditures relate the information provided in sub11 section (c) with respect to such expenditures, or who fails 

12 to provide all of the information required under subsection 

13 (b) or fails to provide correct information, shall pay a pen14 alty in the amount determined under subsection (b). 

15 ‘‘(b) DETERMINATION OF PENALTY AMOUNT.— 

16 ‘‘(1) IN GENERAL.—The amount of the penalty 

17 under this section for any failure described in sub18 section (a) shall be the greater of— 

19 ‘‘(A) $10,000, or 

20 ‘‘(B) the product of $1,000 and the num21 ber of full time equivalent employees of the em22 ployer (as determined under section 45R(d)(2)). 

23 ‘‘(2) INCREASED PENALTY WHERE FAILURE

24 CONTINUES.— 


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1 ‘‘(A) IN GENERAL.—If any failure de2 scribed in subsection (a) (1) continues for more 

3 than 90 days after the day on which the Sec4 retary mails notice of such failure to the tax5 payer, the taxpayer shall pay a penalty (in addi6 tion to the amount of any penalty under para7 graph (1)) equal to the amount determined 

8 under paragraph (1) for each 30-day period (or 

9 fraction thereof) during which such failure con10 tinues after the expiration of such 90-day pe11 riod. 

12 ‘‘(B) LIMITATION.—The penalty imposed 

13 under this paragraph with respect to any failure 

14 shall not exceed $100,000. 

15 ‘‘(c) INFORMATION TO BE PROVIDED.—The infor16 mation required under this subsection shall include— 

17 ‘‘(1) the dates that such activities described in 

18 section 162(e)(1)(E) took place, 

19 ‘‘(2) a statement indicating whether the activity 

20 was an activity described in item (aa), (bb), or (cc) 

21 of section 162(e)(4)(D)(i)(I), 

22 ‘‘(3) the amounts paid or incurred for such ac23 tivities, 

24 ‘‘(4) a copy of any disclosures which are re25 quired to be reported under the Labor-Management 


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1 Reporting and Disclosure Act of 1959 (29 U.S.C. 

2 401 et seq.), and 

3 ‘‘(5) such other information as the Secretary 

4 may prescribe. 

5 ‘‘(d) REASONABLE CAUSE EXCEPTION.—No penalty 

6 shall be imposed by this section on any failure which is 

7 shown to be due to reasonable cause and not due to willful 

8 neglect.’’. 

9 (B) CLERICAL AMENDMENT.—The table of 

10 sections for part I of subchapter B of chapter 

11 68 is amended by adding at the end the fol12 lowing new item: 

‘‘Sec. 6720D. Failure to include certain information with respect to employer 

activities relating to labor organizations.’’. 

13 (2) THIRD-PARTY INFORMATION REPORTING.— 

14 (A) IN GENERAL.—Subpart A of part III 

15 of subchapter A of chapter 61 of the Internal 

16 Revenue Code of 1986 is amended by inserting 

17 after section 6039J the following new section: 

18 ‘‘SEC. 6039K. INFORMATION WITH RESPECT TO CERTAIN 

19 EMPLOYER ACTIVITIES RELATING TO LABOR 

20 ORGANIZATIONS. 

21 ‘‘(a) IN GENERAL.—Any person conducting activities 

22 described in section 162(e)(1)(E) on behalf of another per23 son shall file a return (at such time and in such manner 


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1 as the Secretary may by regulations prescribe, which in2 cludes the information described in subsection (b). 

3 ‘‘(b) INFORMATION TO BE PROVIDED.—Information 

4 required under subsection (a) shall include— 

5 ‘‘(1) the person on behalf of whom the activities 

6 described in section 162(e)(1)(E) were performed, 

7 ‘‘(2) the dates that such activities described in 

8 such section took place, 

9 ‘‘(3) a statement indicating whether the activity 

10 was an activity described in item (aa), (bb), or (cc) 

11 of section 162(e)(4)(D)(i)(I), 

12 ‘‘(4) the amounts paid or incurred for such ac13 tivities, and 

14 ‘‘(5) such other information as the Secretary 

15 may prescribe.’’. 

16 (B) PENALTY.—Subparagraph (B) of sec17 tion 6724(d)(1) of such Code is amended— 

18 (i) by striking the comma at the end 

19 of clause (xxvii), as added by the Infra20 structure Investment and Jobs Act, and in21 serting ‘‘, or’’, and 

22 (ii) by adding at the end the following 

23 new clause: 

24 ‘‘(xxviii) section 6039K (relating to 

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1 ployer activities relating to labor organiza2 tions), and’’. 

3 (C) CLERICAL AMENDMENT.—The table of 

4 sections for subpart A of part III of subchapter 

5 A of chapter 61 of such Code is amended by in6 serting after the item relating to section 6039J 

7 the following new item: 

‘‘Sec. 6039K. Information with respect to certain employer activities relating to 

labor organizations.’’. 

8 (e) CONFORMING AMENDMENTS.— 

9 (1) The heading for subsection (e) of section 

10 162 of the Internal Revenue Code of 1986 is amend11 ed by striking ‘‘AND POLITICAL EXPENDITURES’’ 

12 and inserting ‘‘, POLITICAL EXPENDITURES, AND

13 LABOR ORGANIZATION EXPENDITURES’’. 

14 (2) The heading of subparagraph (C) of section 

15 162(e)(4) of such Code is amended by striking ‘‘AND

16 POLITICAL ACTIVITIES’’ and inserting ‘‘, POLITICAL, 

17 AND LABOR ORGANIZATION ACTIVITIES’’. 

18 (f) EFFECTIVE DATE.—The amendments made by 

19 this section shall apply to amounts paid or incurred in tax20 able years beginning after the date that is 240 days after 

21 the date of the enactment of this Act. 

Æ 


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