diff --git a/src/libs/ReportUtils.ts b/src/libs/ReportUtils.ts
index b1444d33ccb7..b8c306b549a7 100644
--- a/src/libs/ReportUtils.ts
+++ b/src/libs/ReportUtils.ts
@@ -2983,7 +2983,9 @@ function getModifiedExpenseOriginalMessage(
         originalMessage.tag = transactionChanges?.tag;
     }
 
-    if ('taxAmount' in transactionChanges) {
+    // We only want to display a tax amount update system message when tax amount is updated by user.
+    // Tax amount can change as a result of amount, currency or tax rate update. In such cases, we want to skip displaying a system message, as discussed.
+    if ('taxAmount' in transactionChanges && !('amount' in transactionChanges || 'currency' in transactionChanges || 'taxCode' in transactionChanges)) {
         originalMessage.oldTaxAmount = TransactionUtils.getTaxAmount(oldTransaction, isFromExpenseReport);
         originalMessage.taxAmount = transactionChanges?.taxAmount;
         originalMessage.currency = TransactionUtils.getCurrency(oldTransaction);