UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES

Investment Company Act File Number: 811-08207

T. Rowe Price Tax-Efficient Funds, Inc.

(Exact name of registrant as specified in charter)

100 East Pratt Street, Baltimore, MD 21202                

(Address of principal executive offices)

David Oestreicher

100 East Pratt Street, Baltimore, MD 21202

(Name and address of agent for service)

Registrant’s telephone number, including area code: (410) 345-2000

Date of fiscal year end: February 28

Date of reporting period: February 28, 2023

Item 1. Reports to Shareholders

(a) Report pursuant to Rule 30e-1

Highlights

and

Market

Commentary

Management’s

Discussion

of

Fund

Performance

Performance

and

Expenses

Financial

Highlights

Portfolio

of

Investments

Financial

Statements

and

Notes

Additional

Fund

Information

February

28,

2023

Annual

Report

For

more

insights

from

T.

Rowe

Price

investment

professionals,

go

to

troweprice.com

.

T.

ROWE

PRICE

PREFX

Tax-Efficient

Equity

Fund

–

.

TEEFX

Tax-Efficient

Equity

Fund–

.

I Class

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

HIGHLIGHTS

The

Tax-Efficient

Equity

Fund

outperformed

the

Lipper

Multi-Cap

Growth

Funds

Index

during

our

fiscal

year.

The

fund

modestly

lagged

its

Russell

3000

Growth

Index

benchmark,

however.

The

fund’s

tax

efficiency

remains

very

high,

which

means

that

the

portfolio’s

after-tax

returns

are

very

close

to

its

pretax

returns.

While

most

equity

portfolio

managers

are

focused

exclusively

on

pretax

returns—which

usually

leads

to

large

annual

distributions

of

taxable

capital

gains

and

after-tax

returns

that

are

materially

lower

than

their

pretax

returns—our

focus

on

after-tax

returns

makes

this

fund

nearly

unique.

We

continue

to

adhere

to

the

basic

tenets

of

our

strategy,

which

we

believe

have

made

it

successful

over

the

long

term;

we

also

believe

that

our

disciplined

investment

process

will

produce

favorable

pretax

and

after-tax

results

over

time.

After

their

recent

poor

performance,

we

believe

bonds

remain

unattractive

investments.

Stocks

could

continue

to

face

challenges,

but

we

believe

they

are

a

better

option

for

investors

seeking

capital

growth

over

time.

We

strongly

discourage

market

timing,

which

requires

an

investor

to

be

correct

twice

to

be

successful

and

is

nearly

impossible

to

execute.

Log

in

to

your

account

at

troweprice.com

for

more

information.

*

Certain

mutual

fund

accounts

that

are

assessed

an

annual

account

service

fee

can

also

save

money

by

switching

to

e-delivery.

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

Market

Commentary

1

Dear

Shareholder

Nearly

all

major

global

stock

and

bond

indexes

declined

during

your

fund’s

fiscal

year,

the

12-month

period

ended

February

28,

2023,

as

investors

contended

with

persistently

high

inflation,

tightening

financial

conditions,

and

slowing

economic

and

corporate

earnings

growth.

The

downturn

was

most

pronounced

in

the

first

half

of

the

period,

with

many

sectors

partially

rebounding

over

the

final

six

months

as

recession

fears

receded

somewhat.

For

the

12-month

period,

value

shares

declined

but

generally

outperformed

growth

stocks

as

rising

interest

rates

put

downward

pressure

on

growth

stock

valuations.

European

equities

outperformed

most

other

regions,

and

emerging

markets

stocks

generally

underperformed

shares

in

developed

markets.

Meanwhile,

most

currencies

weakened

versus

the

U.S.

dollar

over

the

period,

which

weighed

on

returns

for

U.S.

investors

in

international

securities.

Within

the

S&P

500

Index,

energy

was

a

bright

spot,

gaining

more

than

20%

as

oil

prices

jumped

in

response

to

Russia’s

invasion

of

Ukraine

and

concerns

over

supply

shortages.

Conversely,

communication

services

and

consumer

discretionary

shares

suffered

the

largest

declines.

Elevated

inflation

remained

a

leading

concern

for

investors

throughout

the

period,

although

there

were

signs

that

price

increases

were

moderating

by

period-end.

January’s

consumer

price

index

data

(the

latest

available

in

our

reporting

period)

showed

a

headline

inflation

rate

of

6.4%

on

a

12-month

basis,

the

lowest

level

since

October

2021

but

still

well

above

the

Federal

Reserve’s

2%

long-term

target.

In

response

to

the

high

inflation

readings,

the

Fed

raised

its

short-term

lending

benchmark

from

near

zero

in

March

2022

to

a

target

range

of

4.50%

to

4.75%

by

the

end

of

the

period,

the

highest

since

2007.

The

Fed

stepped

down

to

a

25-basis-point

increase

in

February

after

a

series

of

historically

large

75-basis-

point

hikes

in

2022,

but

policymakers

indicated

that

further

rate

increases

are

needed

to

curb

inflation.

Bond

yields

increased

considerably

across

the

U.S.

Treasury

yield

curve

as

the

Fed

tightened

monetary

policy,

with

the

yield

on

the

benchmark

10-year

note

climbing

from

1.83%

at

the

start

of

the

period

to

3.92%

at

the

end

of

February.

Significant

inversions

in

the

yield

curve,

which

are

often

considered

a

warning

sign

of

a

coming

recession,

occurred

during

the

period

as

shorter-maturity

Treasuries

experienced

the

largest

yield

increases.

The

sharp

increase

in

yields

led

to

historically

weak

results

across

the

fixed

income

market.

Municipal

bonds

were

pressured

by

higher

Treasury

yields,

but

the

tax-free

sector

held

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

2

up

better

than

Treasuries

during

the

period.

Although

municipals

experienced

outflows,

a

drop

in

new

issuance

amid

higher

borrowing

costs

provided

technical

support.

As

the

period

came

to

an

end,

the

economic

backdrop

appeared

mixed.

Corporate

earnings

declined

4.6%

in

the

fourth

quarter

for

the

year-over-

year

period,

according

to

FactSet,

the

first

decline

in

earnings

since

the

third

quarter

of

2020.

However,

the

U.S.

jobs

market

remained

resilient,

with

the

unemployment

rate

reaching

its

lowest

level

since

1969,

and

corporate

and

household

balance

sheets

appeared

strong.

Moreover,

China’s

decision

near

the

end

of

2022

to

ease

its

strict

pandemic-related

restrictions

spurred

hopes

that

the

reopening

of

the

world’s

second-largest

economy

would

boost

global

growth.

While

the

U.S.

economy

has

so

far

managed

to

avoid

a

recession,

we

believe

that

volatility

may

continue

in

the

near

term

as

central

banks

tighten

policy

amid

slowing

economic

growth.

However,

in

our

view,

there

continue

to

be

opportunities

for

selective

investors

focused

on

fundamentals.

Valuations

in

most

global

equity

markets

have

improved,

while

bond

yields

have

reached

some

of

the

most

attractive

levels

since

the

2008

global

financial

crisis.

We

believe

this

environment

makes

skilled

active

management

a

critical

tool

for

identifying

risks

and

opportunities,

and

our

investment

teams

will

continue

to

use

fundamental

research

to

identify

securities

that

have

the

potential

to

add

value

to

your

portfolio

over

the

long

term.

Thank

you

for

your

continued

confidence

in

T.

Rowe

Price.

Sincerely, 

Robert

Sharps

CEO

and

President

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

Management’s

Discussion

of

Fund

Performance

3

INVESTMENT

OBJECTIVE 

The

fund

seeks

to

maximize

after-tax

growth

of

capital

through

investments

primarily

in

common

stocks.

FUND

COMMENTARY

How

did

the

fund

perform

in

the

past 12

months?

Growth

stocks

fared

poorly

over

the

last

year,

as

inflation

and

rising

interest

rates

led

to

slowing

economic

and

corporate

earnings

growth.

The

Tax-Efficient

Equity

Fund

returned

-14.32%

in

the

one-year

period

ended

February

28,

2023.

As

shown

in

the

Performance

Comparison

table,

the

fund

slightly

underperformed

its

benchmark,

the

Russell

3000

Growth

Index,

but

held

up

better

than

the

Lipper

Multi-Cap

Growth

Funds

Index.

(Performance

for

the

fund’s

I

Class

shares

will

vary

due

to

a

different

fee

structure.

The

fund’s

I

Class

shares

are

designed

to

be

sold

to

various

institutional

investors

and

generally

require

a

minimal

initial

investment

of

$500,000.

Past

performance

cannot

guarantee

future

results.

)

What

factors

influenced

the

fund’s

performance?

The

fund’s

relative

performance

over

the

last

12

months

was

hurt

by

stock

selection

in

the

poor-performing

information

technology

and

communication

services

sectors,

though

our

stock

choices

among

consumer

discretionary

companies

helped

the

portfolio’s

relative

results.

Our

underweight

in

the

relatively

small

consumer

staples

sector,

which

held

up

well

over

the

last

year,

also

worked

against

us.

Our

underweight

reflects

our

belief

that

most

consumer

staples

companies

are

mature

and

fairly

valued.

In

the

information

technology

sector,

where

we

favor

companies

with

strong

business

models

in

industries

with

high

barriers

to

entry

and

low

risk

of

commoditization,

our

large

stake

in

Apple

declined

in

value

but

held

up

better

than

the

broad

tech

sector.

However,

our

underweight

versus

the

Russell

benchmark—reflecting

our

preference

for

mid-cap

companies

and

businesses

that

are

earlier

in

their

life

cycles—hurt

relative

performance.

Our

smaller

stakes

in

other

tech

companies

that

fared

worse

also

detracted.

These

include

PERFORMANCE

COMPARISON

Total

Return

Periods

Ended

2/28/23

6

Months

12

Months

Tax-Efficient

Equity

Fund

–

.

-1.58‌%

-14.32‌%

Tax-Efficient

Equity

Fund–

.

I  Class

-1.48‌

-14.18‌

Russell

3000

Growth

Index

-0.98‌

-13.01‌

Lipper

Multi-Cap

Growth

Funds

Index

-1.56‌

-17.06‌

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

4

Shopify,

which

provides

an

online

commerce

platform

for

small

to

mid-size

businesses;

Bill.com

Holdings,

a

provider

of

business-to-business

payments

software

that

simplifies,

digitizes,

and

automates

complex

back-office

financial

operations

for

smaller

businesses;

and

Salesforce,

a

leading

provider

of

customer

relationship

management

software

applications.

(Please

refer

to

the

portfolio

of

investments

for

a

complete

list

of

holdings

and

the

amount

each

represents

in

the

portfolio.)

Stock

selection

in

the

consumer

discretionary

sector

helped

the

portfolio’s

relative

performance.

Our

sizable

stake

in

Amazon.com

fell

sharply

over

the

last

year,

but

our

underweight

position

worked

in

our

favor.

Our

smaller

stakes

in

other

companies

that

produced

solid

positive

returns

in

a

tough

consumer

environment

also

helped

relative

results.

These

included

auto

parts

retailers

O’Reilly

Automotive

and

AutoZone;

discount

retailer

Dollar

General;

and

Tractor

Supply

Company,

a

specialty

retailer

that

serves

the

needs

of

recreational

farmers,

ranchers,

tradesmen,

and

small

businesses.

The

communication

services

sector

was

the

worst-performing

sector

in

our

benchmark

over

the

last

year,

and

our

stock

selection

was

a

factor

in

our

relative

underperformance.

Our

sector

exposure

is

modest,

with

investments

concentrated

in

the

marketing

services

and

interactive

media

industries.

Our

stake

in

The

Trade

Desk,

a

technology

platform

that

provides

programmatic

ad

buying

and

media

planning

tools

for

advertisers

and

advertising

agencies,

declined

materially.

Since

its

inception,

the

fund

has

made

only

minimal

taxable

distributions,

reflecting

our

attempts

to

generate

strong,

long-term

after-tax

returns.

While

most

equity

portfolio

managers

are

only

focused

on

pretax

returns—which

usually

result

in

large

annual

distributions

of

taxable

capital

gains

and

after-tax

returns

that

are

materially

lower

than

their

pretax

returns—our

focus

on

after-

tax

performance

makes

this

fund

nearly

unique

among

its

peers.

To

help

us

minimize

taxable

events,

we

work

to

keep

the

portfolio’s

turnover

rate

low.

The

22%

portfolio

turnover

rate

over

the

last

12

months

reflects

our

efforts

to

keep

the

realization

of

capital

gains

low.

This

number

also

reflects

that,

in

light

of

the

current

market

environment,

we

have

been

active

in

recognizing

losses

in

the

portfolio.

Over

the

last

year,

we

recognized

a

net

$6

million

in

losses.

How

is

the

fund

positioned?

Some

of

the

portfolio’s

fundamental

characteristics

were

somewhat

similar

to

those

of

the

benchmark.

For

example,

its

historical

earnings

growth

rate

over

the

last

five

years

(22.4%)

matched

that

of

the

index.

Also,

the

fund’s

projected

long-term

earnings

growth

rate

(11.9%)

was

marginally

higher

than

that

of

the

benchmark

(11.8%),

while

its

12-month

forward

price/earnings

ratio

(25.2)

was

slightly

higher

than

that

of

the

index

(23.7).

However,

the

return

on

equity

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

5

(ROE)

of

the

portfolio’s

holdings

(33.9%)

was

lower

than

that

of

the

Russell

3000

Growth

Index

(37.6%).

We

consider

a

high

ROE—which

measures

how

effectively

and

efficiently

a

company

and

its

management

are

using

stockholder

investments—to

be

desirable,

though

we

do

not

necessarily

seek

companies

with

the

highest

ROEs.

We

prefer

businesses

with

steady

and

sustainable

growth

and

profitability,

rather

than

companies

whose

growth

and

profitability

are

unsustainably

high.

The

portfolio’s

investment-

weighted

median

market

capitalization

at

the

end

of

February

was

about

$109.9

billion

versus

$214.8

billion

for

the

benchmark.

We

favor

mid-cap

stocks

over

larger

companies,

as

noted

earlier,

because

we

believe

mid-

caps

offer

better

long-term

growth

potential,

especially

considering

the

strong

outperformance

of

large-

cap

growth

stocks

over

other

investment

styles

in

the

last

five

years.

The

Russell

1000

Growth

Index

produced

an

average

annual

total

return

of

11.54%

in

the

five-year

period

ended

February

28,

2023,

versus

8.74%

for

the

Russell

Midcap

Growth

Index

and

5.06%

for

the

Russell

2000

Growth

Index.

The

portfolio

was

also

less

aggressively

positioned

versus

its

Russell

benchmark.

Its

beta

is

lower

and,

all

else

being

equal,

it

should

fall

less

during

a

down

market

environment.

As

our

longer-term

investors

know,

we

focus

our

efforts

on

stock

selection

and

do

not

make

major

sector

bets.

Also,

we

keep

our

cash

position

very

low

because

successful

market

timing

is

virtually

impossible.

As

shown

in

the

Sector

Diversification

table,

the

fund’s

information

technology

allocation

was

our

largest

in

absolute

terms

and

represented

an

overweight

versus

the

benchmark.

We

are

broadly

diversified

in

the

tech

sector

in

light

of

its

volatility.

SECTOR

DIVERSIFICATION

Percent

of

Net

Assets

as

of

2/28/23

Tax-Efficient

Equity

Fund

Russell

3000

Growth

Index

Information

Technology

45.3‌%

43.1‌%

Consumer

Discretionary

13.4‌

15.1‌

Health

Care

12.8‌

12.6‌

Industrials

&

Business

Services

8.4‌

8.6‌

Communication

Services

5.6‌

6.5‌

Financials

5.2‌

3.4‌

Consumer

Staples

4.0‌

5.5‌

Materials

2.0‌

1.6‌

Energy

1.9‌

1.8‌

Real

Estate

1.3‌

1.6‌

Utilities

0.0‌

0.2‌

Other

and

Reserves

0.1‌

0.0‌

Total

100.0‌%

100.0‌%

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

6

Our

second-largest

sector

allocation

in

absolute

terms

was

consumer

discretionary,

which

we

are

underweighting.

In

this

sector,

which

includes

an

eclectic

assortment

of

businesses—including

retailers,

restaurants,

and

casinos—we

seek

companies

with

good

business

models,

excellent

cash

flow,

and

other

favorable

attributes

that

leave

them

in

a

position

of

relative

strength.

We

emphasize

leading

companies

within

their

respective

niches

and

avoid

retailers

that

Amazon.com

can

easily

attack.

Our

health

care

allocation

was

very

close

to

that

of

the

index.

We

are

reasonably

diversified

in

the

health

care

space

but

favor

managed

care

companies

reflective

of

demographic

factors

and

desires

for

increased

access

to

health

care

services,

as

well

as

health

care

equipment

and

supplies

companies.

To

a

lesser

degree,

we

also

look

for

innovative

biotechnology

companies

with

promising

products

that

address

large,

unmet

medical

needs.

Elsewhere

in

the

portfolio,

we

are

underweighting

consumer

staples,

mentioned

earlier,

but

we

are

overweighting

the

financials

sector,

where

we

look

for

differentiated

companies,

such

as

capital

markets

companies,

with

high

returns

on

invested

capital.

What

is

portfolio

management’s

outlook?

The

last

12

months

featured

poor

performance

for

stocks

and

bonds

following

a

prolonged

period

of

speculation,

driven

in

part

by

low

nominal

interest

rates

and

negative

real

(inflation-adjusted)

interest

rates.

In

response

to

shockingly

high

inflation

and

aggressive

Federal

Reserve

interest

rate

increases,

investors

turned

risk

averse

and

adopted

a

more

sober

view

of

the

capital

markets.

An

economic

slowdown

in

response

to

rising

rates

is

the

result.

In

2022,

stocks

with

a

lower

beta

(a

measure

of

volatility)

had

strong

performance

relative

to

stocks

with

higher

betas.

Companies

with

the

highest

dividend

yields

also

had

strong

relative

returns,

as

inflation

and

rising

interest

rates

prompted

income-focused

investors

to

seek

out

stocks

with

attractive

dividends.

In

addition,

stocks

of

companies

with

the

most

leverage

outperformed

amid

high

inflation,

which

reduces

the

real

value

of

corporate

debt

liabilities.

Value

stocks

significantly

outperformed

growth

stocks

across

all

market

capitalizations

in

2022;

despite

this,

large-cap

growth

stocks,

as

measured

by

Russell

indexes,

still

had

a

healthy

five-year

performance

advantage

over

their

value

counterparts.

Initial

public

offerings,

mergers

and

acquisitions,

and

private-equity

capital-raising

efforts

were

quiet

for

much

of

the

year.

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

7

Bond

returns

were

sharply

negative

over

the

last

year,

and

major

bond

index

returns

have

been

disappointing

in

nominal

terms

in

the

last

five

years.

Clearly,

the

40-year-old

bond

bull

market

is

over.

Even

after

their

recent

poor

performance,

we

believe

bonds

remain

unattractive

investments,

as

real

interest

rates

are

still

below

0%.

Moreover,

it

is

unclear

how

enduring

high

inflation

will

be.

Stocks

could

continue

to

face

challenges

in

2023

in

response

to

slower

economic

and

corporate

earnings

growth,

but

we

believe

they

are

a

better

option

for

investors

seeking

capital

growth

over

time.

We

are

maintaining

a

longer-term

focus,

as

we

look

for

enduring

businesses

that

can

perform

well

throughout

economic

cycles.

We

encourage

equity

investors

to

stay

focused

on

the

long

term

and

remain

fully

invested.

We

strongly

discourage

market

timing,

which

requires

an

investor

to

be

correct

twice

to

be

successful

and

is

nearly

impossible

to

execute.

Despite

varying

environments

in

which

growth

stocks

have

occasionally

lagged

other

investment

styles,

the

portfolio

has

outperformed

its

Lipper

peer

group

index

on

a

pretax

basis

over

the

1-,

3-,

5-,

and

10-year

periods

ended

February

28,

2023.

We

believe

adhering

to

the

basic

tenets

of

our

strategy—

staying

fully

invested,

focusing

on

longer-term

investment

horizons,

favoring

quality

companies,

and

factoring

valuations

and

risks

into

our

portfolio

decisions—has

made

it

successful

over

the

long

term.

We

also

believe

that

our

disciplined

process

of

researching

and

selecting

reasonably

priced

growth

companies

with

attractive

attributes

will

continue

to

produce

favorable

pretax

and

after-tax

results

over

time.

The

fund’s

average

annual

total

returns

for

the

1-,

3-,

5-,

and

10-year

periods

ended

February

28,

2023,

were

-

14.32%

,

8.55%

,

9.41%

,

and

12.51%

,

respectively.

The

Lipper

Multi-Cap

Growth

Funds

Index’s

returns

for

the

same

periods

were

-17.06%,

7.27%,

7.74%,

and

11.53%,

respectively.

The

fund’s

performance

information

represents

only

past

performance

and

is

not

necessarily

an

indication

of

future

results.

Current

performance

may

be

lower

or

higher

than

the

performance

data

cited.

Share

price,

principal

value,

and

return

will

vary,

and

you

may

have

a

gain

or

loss

when

you

sell

your

shares.

For

the

most

recent

month-end

performance,

please

visit

our

website

(troweprice.com)

or

contact

a

T.

Rowe

Price

representative

at

1-800-225-5132

or,

for

I

Class

shares,

1-800-638-8790.

The

views

expressed

reflect

the

opinions

of

T.

Rowe

Price

as

of

the

date

of

this

report

and

are

subject

to

change

based

on

changes

in

market,

economic,

or

other

conditions.

These

views

are

not

intended

to

be

a

forecast

of

future

events

and

are

no

guarantee

of

future

results.

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

8

RISKS

OF

INVESTING

IN

THE

TAX-EFFICIENT

EQUITY

FUND

Common

stocks

generally

fluctuate

in

value

more

than

bonds

and

may

decline

significantly

over

short

time

periods.

There

is

a

chance

that

stock

prices

overall

will

decline

because

stock

markets

tend

to

move

in

cycles,

with

periods

of

rising

and

falling

prices.

The

value

of

a

stock

in

which

the

fund

invests

may

decline

due

to

general

weakness

in

the

stock

market

or

because

of

factors

that

affect

a

particular

company

or

industry.

The

fund’s

focus

on

large

and

medium-sized

companies

subjects

the

fund

to

the

risks

that

larger

companies

may

not

be

able

to

attain

the

high

growth

rates

of

successful

smaller

companies,

especially

during

strong

economic

periods,

and

that

they

may

be

less

capable

of

responding

quickly

to

competitive

challenges

and

industry

changes.

Because

the

fund

focuses

on

large

and

medium-sized

companies,

its

share

price

could

be

more

volatile

than

a

fund

that

invests

only

in

large

companies.

Medium-sized

companies

typically

have

less

experienced

management,

narrower

product

lines,

more

limited

financial

resources,

and

less

publicly

available

information

than

larger

companies.

Different

investment

styles

tend

to

shift

in

and

out

of

favor

depending

on

market

conditions

and

investor

sentiment.

The

fund’s

growth

approach

to

investing

could

cause

it

to

underperform

when

compared

with

other

stock

funds

that

employ

a

different

investment

style.

Growth

stocks

tend

to

be

more

volatile

than

certain

other

types

of

stocks,

and

their

prices

may

fluctuate

more

dramatically

than

the

overall

stock

market.

A

stock

with

growth

characteristics

can

have

sharp

price

declines

due

to

decreases

in

current

or

expected

earnings

and

may

lack

dividends

that

can

help

cushion

its

share

price

in

a

declining

market.

In

addition,

the

fund’s

attempts

at

investing

in

a

tax-efficient

manner

could

cause

it

to

underperform

similar

funds

that

do

not

make

tax

efficiency

a

primary

focus.

BENCHMARK

INFORMATION

Note:

Portions

of

the

mutual

fund

information

contained

in

this

report

was

supplied

by

Lipper,

a

Refinitiv

Company,

subject

to

the

following:

Copyright

2023

©

Refinitiv.

All

rights

reserved.

Any

copying,

republication

or

redistribution

of

Lipper

content

is

expressly

prohibited

without

the

prior

written

consent

of

Lipper.

Lipper

shall

not

be

liable

for

any

errors

or

delays

in

the

content,

or

for

any

actions

taken

in

reliance

thereon.

Note:

London

Stock

Exchange

Group

plc

and

its

group

undertakings

(collectively,

the

“LSE

Group”).

©

LSE

Group

2023.

FTSE

Russell

is

a

trading

name

of

certain

of

the

LSE

Group

companies.  “Russell

®

” is/are

a

trademark(s)

of

the

relevant

LSE

Group

companies

and

is/are

used

by

any

other

LSE

Group

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

9

company

under

license.

All

rights

in

the

FTSE

Russell

indexes

or

data

vest

in

the

relevant

LSE

Group

company

which

owns

the

index

or

the

data.

Neither

LSE

Group

nor

its

licensors

accept

any

liability

for

any

errors

or

omissions

in

the

indexes

or

data

and

no

party

may

rely

on

any

indexes

or

data

contained

in

this

communication.

No

further

distribution

of

data

from

the

LSE

Group

is

permitted

without

the

relevant

LSE

Group

company’s

express

written

consent.

The

LSE

Group

does

not

promote,

sponsor

or

endorse

the

content

of

this

communication.

The

LSE

Group

is

not

responsible

for

the

formatting

or

configuration

of

this

material

or

for

any

inaccuracy

in

T.

Rowe

Price’s

presentation

thereof.

BENCHMARK

INFORMATION

(continued)

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

10

PORTFOLIO

HIGHLIGHTS

TWENTY-FIVE

LARGEST

HOLDINGS

Percent

of

Net

Assets

2/28/23

Apple

8.8‌%

Microsoft

8.1‌ 

Alphabet

4.5‌ 

Visa

3.5‌ 

NVIDIA

3.2‌ 

Amazon.com

2.4‌ 

UnitedHealth

Group

2.3‌ 

MasterCard

2.2‌ 

KLA

1.4‌ 

Tesla

1.3‌ 

S&P

Global

1.1‌ 

Eli

Lilly

and

Co

1.1‌ 

Home

Depot

1.1‌ 

Accenture

1.0‌ 

Synopsys

0.9‌ 

Diageo

0.9‌ 

Intuit

0.8‌ 

O'Reilly

Automotive

0.8‌ 

Hilton

Worldwide

Holdings

0.8‌ 

PepsiCo

0.8‌ 

UPS

0.8‌ 

Thermo

Fisher

Scientific

0.8‌ 

Amphenol

0.7‌ 

CDW

Corp/DE

0.7‌ 

Fortinet

0.7‌ 

Total

50.7‌%

Note:

The

information

shown

does

not

reflect

any

exchange-traded

funds

(ETFs),

cash

reserves,

or

collateral

for

securities

lending

that

may

be

held

in

the

portfolio.

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

11

GROWTH

OF

$10,000 

This

chart

shows

the

value

of

a

hypothetical

$10,000

investment

in

the

fund

over

the

past

10

fiscal

year

periods

or

since

inception

(for funds

lacking

10-year

records).

The

result

is

compared

with

benchmarks,

which

include

a

broad-based

market

index

and

may

also

include

a

peer

group

average

or

index.

Market

indexes

do

not

include

expenses,

which

are

deducted

from

fund returns

as

well

as

mutual fund

averages

and

indexes.

TAX-EFFICIENT

EQUITY

FUND 

Note:

Performance

for

the

I

Class shares

will

vary

due

to

their differing

fee

structure.

See

the

Average

Annual

Compound

Total

Return

table. 

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

12

AVERAGE

ANNUAL

COMPOUND

TOTAL

RETURN

EXPENSE

RATIO

FUND

EXPENSE

EXAMPLE

As

a

mutual

fund

shareholder,

you

may

incur

two

types

of

costs:

(1)

transaction

costs,

such

as

redemption

fees

or

sales

loads,

and

(2)

ongoing

costs,

including

management

fees,

distribution

and

service

(12b-1)

fees,

and

other

fund

expenses.

The

following

example

is

intended

to

help

you

understand

your

ongoing

costs

(in

dollars)

of

investing

in

the

fund

and

to

compare

these

costs

with

the

ongoing

costs

of

investing

in

other

mutual

funds.

The

example

is

based

on

an

investment

of

$1,000

invested

at

the

beginning

of

the

most

recent

six-month

period

and

held

for

the

entire

period.

Please

note

that

the

fund

has

two

share

classes:

The

original

share

class

(Investor

Class)

charges

no

distribution

and

service

(12b-1)

fee,

and

the

I

Class

shares

are

also

available

to

institutionally

oriented

clients

and

impose

no

12b-1

or

administrative

fee

payment.

Each

share

class

is

presented

separately

in

the

table.

Periods

Ended

2/28/23

1

Year

5

Years

10

Years

Since

Inception

Inception

Date

Tax-Efficient

Equity

Fund

–

.

-14.32‌%

9.41‌%

12.51‌%

–‌

–

Tax-Efficient

Equity

Fund–

.

I  Class

-14.18‌

9.51‌

–‌

11.65‌%

7/6/17

This

table

shows

how

the

fund

would

have

performed

each

year

if

its

actual

(or

cumulative)

returns

for

the

periods

shown

had

been

earned

at

a

constant

rate.

Returns

do

not

reflect

taxes

that

the

shareholder

may

pay

on

fund

distributions

or

the

redemption

of

fund

shares.

Past

performance

cannot

guarantee

future

results.

When

assessing

performance,

investors

should

consider

both

short-

and

long-term

returns.

Tax-Efficient

Equity

Fund

0.76‌%

Tax-Efficient

Equity

Fund–I

Class

0.67‌ 

The

expense

ratio

shown

is

as

of

the

fund’s

most

recent

prospectus.

This

number

may

vary

from

the

expense

ratio

shown

elsewhere

in

this

report

because

it

is

based

on

a

different

time

period

and,

if

applicable,

includes

acquired

fund

fees

and

expenses

but

does

not

include

fee

or

expense

waivers.

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

13

Actual

Expenses

The

first

line

of

the

following

table

(Actual)

provides

information

about

actual

account

values

and

expenses

based

on

the

fund’s

actual

returns.

You

may

use

the

information

on

this

line,

together

with

your

account

balance,

to

estimate

the

expenses

that

you

paid

over

the

period.

Simply

divide

your

account

value

by

$1,000

(for

example,

an

$8,600

account

value

divided

by

$1,000

=

8.6),

then

multiply

the

result

by

the

number

on

the

first

line

under

the

heading

“Expenses

Paid

During

Period”

to

estimate

the

expenses

you

paid

on

your

account

during

this

period.

Hypothetical

Example

for

Comparison

Purposes

The

information

on

the

second

line

of

the

table

(Hypothetical)

is

based

on

hypothetical

account

values

and

expenses

derived

from

the

fund’s

actual

expense

ratio

and

an

assumed

5%

per

year

rate

of

return

before

expenses

(not

the

fund’s

actual

return).

You

may

compare

the

ongoing

costs

of

investing

in

the

fund

with

other

funds

by

contrasting

this

5%

hypothetical

example

and

the

5%

hypothetical

examples

that

appear

in

the

shareholder

reports

of

the

other

funds.

The

hypothetical

account

values

and

expenses

may

not

be

used

to

estimate

the

actual

ending

account

balance

or

expenses

you

paid

for

the

period.

Note:

T.

Rowe

Price

charges

an

annual

account

service

fee

of

$20,

generally

for

accounts

with

less

than

$10,000.

The

fee

is

waived

for

any

investor

whose

T.

Rowe

Price

mutual

fund

accounts

total

$50,000

or

more;

accounts

electing

to

receive

electronic

delivery

of

account

statements,

transaction

confirmations,

prospectuses,

and

shareholder

reports;

or

accounts

of

an

investor

who

is

a

T.

Rowe

Price

Personal

Services

or

Enhanced

Personal

Services

client

(enrollment

in

these

programs

generally

requires

T.

Rowe

Price

assets

of

at

least

$250,000).

This

fee

is

not

included

in

the

accompanying

table.

If

you

are

subject

to

the

fee,

keep

it

in

mind

when

you

are

estimating

the

ongoing

expenses

of

investing

in

the

fund

and

when

comparing

the

expenses

of

this

fund

with

other

funds.

You

should

also

be

aware

that

the

expenses

shown

in

the

table

highlight

only

your

ongoing

costs

and

do

not

reflect

any

transaction

costs,

such

as

redemption

fees

or

sales

loads.

Therefore,

the

second

line

of

the

table

is

useful

in

comparing

ongoing

costs

only

and

will

not

help

you

determine

the

relative

total

costs

of

owning

different

funds.

To

the

extent

a

fund

charges

transaction

costs,

however,

the

total

cost

of

owning

that

fund

is

higher.

FUND

EXPENSE

EXAMPLE

(CONTINUED)

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

14

TAX-EFFICIENT

EQUITY

FUND

Beginning

Account

Value

9/1/22

Ending

Account

Value

2/28/23

Expenses

Paid

During

Period*

9/1/22

to

2/28/23

Investor

Class

Actual

$1,000.00

$984.20

$4.13

Hypothetical

(assumes

5%

return

before

expenses)

 1,000.00

  1,020.63

  4.21

I

Class

Actual

  1,000.00

  985.20

  3.40

Hypothetical

(assumes

5%

return

before

expenses)

 1,000.00

  1,021.37

  3.46

*

Expenses

are

equal

to

the

fund’s

annualized

expense

ratio

for

the

6-month

period,

multiplied

by

the

average

account

value

over

the

period,

multiplied

by

the

number

of

days

in

the

most

recent

fiscal

half

year

(181),

and

divided

by

the

days

in

the

year

(365)

to

reflect

the

half-year

period.

The

annualized

expense

ratio

of

the

1

Investor

Class

was

0.84%,

and

the

2

I Class

was

0.69%.

FUND

EXPENSE

EXAMPLE

(CONTINUED)

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

15

QUARTER-END

RETURNS

Periods

Ended

12/31/22

1

Year

5

Years

10

Years

Since

Inception

Inception

Date

Tax-Efficient

Equity

Fund

-30.50‌%

9.25‌%

12.51‌%

–‌

–

After

Taxes

on

Distributions

-30.64‌ 

8.90‌ 

12.05‌ 

–‌

–

After

Taxes

on

Distributions

and

Sale

of

Fund

Shares

-17.95‌ 

7.35‌ 

10.39‌ 

–‌

–

Tax-Efficient

Equity

Fund–

I

Class

-30.41‌ 

9.34‌ 

–‌

10.86‌%

7/6/17

After

Taxes

on

Distributions

-30.58‌ 

8.97‌ 

–‌

10.37‌ 

–

After

Taxes

on

Distributions

and

Sale

of

Fund

Shares

-17.89‌ 

7.42‌ 

–‌

8.66‌ 

–

The

fund’s

performance

information

represents

only

past

performance

and

is

not

necessarily

an

indication

of

future

results.

Current

performance

may

be

lower

or

higher

than

the

performance

data

cited.

Share

price,

principal

value,

and

return

will

vary,

and

you

may

have

a

gain

or

loss

when

you

sell

your

shares.

For

the

most

recent

month-end

performance,

please

visit

our

website

(troweprice.com)

or

contact

a

T.

Rowe

Price

representative

at

1

-

800

-

225

-

5132

or,

for

2

I

Class

shares,

1-800-638-8790.

This

table

provides

returns

through

the

most

recent

calendar

quarter-end

rather

than

through

the

end

of

the

fund’s

fiscal

period.

Average

annual

total

returns

include

changes

in

principal

value,

reinvested

dividends,

and

capital

gain

distributions.

The

returns

presented

in

this

table

reflect

the

return

before

taxes;

the

return

after

taxes

on

dividends

and

capital

gain

distributions;

and

the

return

after

taxes

on

dividends,

capital

gain

distributions,

and

gains

(or

losses)

from

the

redemption

of

shares

held

for

1-,

5-,

and

10-year

or

since-inception

periods,

as

applicable.

After-tax

returns

reflect

the

highest

federal

income

tax

rates

but

exclude

state

and

local

taxes.

The

after-tax

returns

reflect

the

rates

applicable

to

ordinary

and

qualified

dividends

and

capital

gains

effective

in

2003.

During

periods

when

the

fund

incurs

a

loss,

the

post-liquidation

after-tax

return

may

exceed

the

fund’s

other

returns

because

the

loss

generates

a

tax

benefit

that

is

factored

into

the

result.

An

investor’s

actual

after-tax

return

will

likely

differ

from

those

shown

and

depend

on

his

or

her

tax

situation.

The

fund’s

past

returns

(before

and

after

taxes)

do

not

necessarily

indicate

future

performance.

When

assessing

performance,

investors

should

consider

both

short-

and

long-term

returns.

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

Financial

Highlights

16

For

a

share

outstanding

throughout

each

period

Investor

Class

..

Year

..

..

Ended

.

2/28/23

2/28/22

2/28/21

2/29/20

2/28/19

NET

ASSET

VALUE

Beginning

of

period

$

52.30‌

$

51.35‌

$

36.51‌

$

32.86‌

$

30.34‌

Investment

activities

Net

investment

income

(loss)

(1)(2)

0.01‌

(0.14‌)

(0.06‌)

0.06‌

0.07‌

Net

realized

and

unrealized

gain/

loss

(7.51‌)

2.36‌

15.91‌

3.80‌

2.83‌

Total

from

investment

activities

(7.50‌)

2.22‌

15.85‌

3.86‌

2.90‌

Distributions

Net

investment

income

—‌

—‌

(0.02‌)

(0.06‌)

(0.05‌)

Net

realized

gain

(0.37‌)

(1.27‌)

(0.99‌)

(0.15‌)

(0.34‌)

Total

distributions

(0.37‌)

(1.27‌)

(1.01‌)

(0.21‌)

(0.39‌)

Redemption

fees

added

to

paid-in

capital

(1)(3)

—‌

—‌

—‌

—‌

(4)

0.01‌

NET

ASSET

VALUE

End

of

period

$

44.43‌

$

52.30‌

$

51.35‌

$

36.51‌

$

32.86‌

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

Financial

Highlights

17

For

a

share

outstanding

throughout

each

period

The

accompanying

notes

are

an

integral

part

of

these

financial

statements.

Investor

Class

..

Year

..

..

Ended

.

2/28/23

2/28/22

2/28/21

2/29/20

2/28/19

Ratios/Supplemental

Data

Total

return

(2)(5)

(14.32‌)%

4.01‌%

43.53‌%

11.73‌%

9.70‌%

Ratios

to

average

net

assets:

(2)

Gross

expenses

before

waivers/

payments

by

Price

Associates

0.85‌%

0.76‌%

0.78‌%

0.79‌%

0.81‌%

Net

expenses

after

waivers/

payments

by

Price

Associates

0.85‌%

0.76‌%

0.78‌%

0.78‌%

0.77‌%

Net

investment

income

(loss)

0.03‌%

(0.25‌)%

(0.14‌)%

0.17‌%

0.21‌%

Portfolio

turnover

rate

21.2‌%

9.6‌%

25.7‌%

22.9‌%

12.1‌%

Net

assets,

end

of

period

(in

thousands)

$250,733

$412,425

$628,056

$540,648

$356,635

0‌%

0‌%

0‌%

0‌%

0‌%

(1)

Per

share

amounts

calculated

using

average

shares

outstanding

method.

(2)

See

Note

6

for

details

of

expense-related

arrangements

with

Price

Associates.

(3)

The

fund

charged

redemption

fees

through

March

31,

2019.

(4)

Amounts

round

to

less

than

$0.01

per

share.

(5)

Total

return

reflects

the

rate

that

an

investor

would

have

earned

on

an

investment

in

the

fund

during

each

period,

assuming

reinvestment

of

all

distributions,

and

payment

of

no

redemption

or

account

fees,

if

applicable.

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

Financial

Highlights

18

For

a

share

outstanding

throughout

each

period

The

accompanying

notes

are

an

integral

part

of

these

financial

statements.

I

Class

..

Year

..

..

Ended

.

2/28/23

2/28/22

2/28/21

2/29/20

2/28/19

NET

ASSET

VALUE

Beginning

of

period

$

52.39‌

$

51.40‌

$

36.50‌

$

32.85‌

$

30.35‌

Investment

activities

Net

investment

income

(loss)

(1)(2)

0.09‌

(0.07‌)

(0.02‌)

0.09‌

0.10‌

Net

realized

and

unrealized

gain/

loss

(7.53‌)

2.33‌

15.93‌

3.80‌

2.81‌

Total

from

investment

activities

(7.44‌)

2.26‌

15.91‌

3.89‌

2.91‌

Distributions

Net

investment

income

(0.05‌)

—‌

(0.02‌)

(0.09‌)

(0.07‌)

Net

realized

gain

(0.37‌)

(1.27‌)

(0.99‌)

(0.15‌)

(0.34‌)

Total

distributions

(0.42‌)

(1.27‌)

(1.01‌)

(0.24‌)

(0.41‌)

NET

ASSET

VALUE

End

of

period

$

44.53‌

$

52.39‌

$

51.40‌

$

36.50‌

$

32.85‌

Ratios/Supplemental

Data

Total

return

(2)(3)

(14.18‌)%

4.08‌%

43.71‌%

11.82‌%

9.70‌%

Ratios

to

average

net

assets:

(2)

Gross

expenses

before

waivers/

payments

by

Price

Associates

0.70‌%

0.68‌%

0.69‌%

0.70‌%

0.73‌%

Net

expenses

after

waivers/

payments

by

Price

Associates

0.69‌%

0.68‌%

0.69‌%

0.69‌%

0.69‌%

Net

investment

income

(loss)

0.19‌%

(0.12‌)%

(0.05‌)%

0.26‌%

0.31‌%

Portfolio

turnover

rate

21.2‌%

9.6‌%

25.7‌%

22.9‌%

12.1‌%

Net

assets,

end

of

period

(in

thousands)

$454,269

$429,930

$144,127

$78,366

$58,744

0‌%

0‌%

0‌%

0‌%

0‌%

(1)

Per

share

amounts

calculated

using

average

shares

outstanding

method.

(2)

See

Note

6

for

details

of

expense-related

arrangements

with

Price

Associates.

(3)

Total

return

reflects

the

rate

that

an

investor

would

have

earned

on

an

investment

in

the

fund

during

each

period,

assuming

reinvestment

of

all

distributions,

and

payment

of

no

redemption

or

account

fees,

if

applicable.

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

February

28,

2023

19

Portfolio

of

Investments

‡

Shares

$

Value

(Cost

and

value

in

$000s)

‡

COMMON

STOCKS

99.5%

COMMUNICATION

SERVICES

5.6%

Entertainment

0.4%

Electronic

Arts 

8,500‌

943‌

Netflix  (1)

4,900‌

1,579‌

Spotify

Technology  (1)

800‌

93‌

Take-Two

Interactive

Software  (1)

1,152‌

126‌

2,741‌

Interactive

Media

&

Services

4.6%

Alphabet,

Class

C  (1)

348,080‌

31,432‌

Match

Group  (1)

15,623‌

647‌

ZoomInfo

Technologies  (1)

2,934‌

71‌

32,150‌

Media

0.4%

Fox,

Class

B 

8,200‌

264‌

Omnicom

Group 

4,300‌

390‌

Trade

Desk,

Class

A  (1)

37,300‌

2,087‌

2,741‌

Wireless

Telecommunication

Services

0.2%

T-Mobile

U.S.  (1)

10,273‌

1,461‌

1,461‌

Total

Communication

Services

39,093‌

CONSUMER

DISCRETIONARY

13.4%

Auto

Components

0.1%

Aptiv (1)

1,410‌

164‌

Mobileye

Global,

Class

A  (1)

5,000‌

198‌

362‌

Automobiles

1.4%

Ferrari 

2,240‌

583‌

Tesla  (1)

44,175‌

9,087‌

9,670‌

Distributors

0.1%

Pool 

2,700‌

964‌

964‌

Diversified

Consumer

Services

0.1%

Bright

Horizons

Family

Solutions  (1)

700‌

55‌

Service

Corp.

International 

14,480‌

978‌

1,033‌

Hotels,

Restaurants

&

Leisure

3.2%

Airbnb,

Class

A  (1)

13,472‌

1,661‌

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

20

Shares

$

Value

(Cost

and

value

in

$000s)

‡

Booking

Holdings  (1)

907‌

2,289‌

Caesars

Entertainment  (1)

4,000‌

203‌

Chipotle

Mexican

Grill  (1)

2,700‌

4,026‌

Churchill

Downs 

1,300‌

319‌

Darden

Restaurants 

1,600‌

229‌

Domino's

Pizza 

3,537‌

1,040‌

DraftKings,

Class

A  (1)

2,000‌

38‌

Hilton

Worldwide

Holdings 

40,000‌

5,780‌

MGM

Resorts

International 

41,400‌

1,781‌

Papa

John's

International 

1,400‌

118‌

Restaurant

Brands

International  (2)

15,802‌

1,019‌

Starbucks 

20,275‌

2,070‌

Vail

Resorts 

1,000‌

233‌

Wynn

Resorts  (1)

1,300‌

141‌

Yum!

Brands 

12,500‌

1,589‌

22,536‌

Household

Durables

0.1%

NVR (1)

150‌

776‌

776‌

Internet

&

Direct

Marketing

Retail

2.7%

Amazon.com (1)

175,860‌

16,571‌

Chewy,

Class

A  (1)(2)

4,000‌

162‌

Etsy  (1)

500‌

61‌

MercadoLibre  (1)

1,600‌

1,952‌

18,746‌

Leisure

Products

0.0%

Mattel (1)

5,500‌

99‌

99‌

Multiline

Retail

0.6%

Dollar

General 

19,248‌

4,164‌

Dollar

Tree  (1)

1,000‌

145‌

Ollie's

Bargain

Outlet

Holdings  (1)

1,892‌

109‌

4,418‌

Specialty

Retail

4.1%

AutoZone (1)

1,204‌

2,994‌

Burlington

Stores  (1)

900‌

193‌

CarMax  (1)

1,500‌

104‌

Five

Below  (1)

6,200‌

1,267‌

Floor

&

Decor

Holdings,

Class

A  (1)

2,500‌

229‌

Home

Depot 

25,840‌

7,663‌

O'Reilly

Automotive  (1)

7,053‌

5,855‌

RH  (1)

300‌

90‌

Ross

Stores 

11,200‌

1,238‌

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

21

Shares

$

Value

(Cost

and

value

in

$000s)

‡

TJX 

31,077‌

2,380‌

Tractor

Supply 

15,752‌

3,674‌

Ulta

Beauty  (1)

5,400‌

2,801‌

Williams-Sonoma 

1,800‌

225‌

28,713‌

Textiles,

Apparel

&

Luxury

Goods

1.0%

Lululemon

Athletica  (1)

10,060‌

3,110‌

NIKE,

Class

B 

30,749‌

3,653‌

Skechers

USA,

Class

A  (1)

3,500‌

156‌

6,919‌

Total

Consumer

Discretionary

94,236‌

CONSUMER

STAPLES

4.0%

Beverages

2.6%

Brown-Forman,

Class

B 

12,512‌

812‌

Constellation

Brands,

Class

A 

8,000‌

1,789‌

Diageo,

ADR  (2)

34,800‌

6,022‌

Keurig

Dr

Pepper 

39,615‌

1,369‌

Monster

Beverage  (1)

23,228‌

2,364‌

PepsiCo 

33,300‌

5,778‌

18,134‌

Food

&

Staples

Retailing

0.5%

BJ's

Wholesale

Club

Holdings  (1)

46,300‌

3,324‌

Casey's

General

Stores 

500‌

104‌

Performance

Food

Group  (1)

3,000‌

170‌

3,598‌

Food

Products

0.5%

Darling

Ingredients  (1)

13,204‌

835‌

Hershey 

8,583‌

2,045‌

McCormick 

11,462‌

852‌

Tyson

Foods,

Class

A 

1,700‌

101‌

3,833‌

Household

Products

0.0%

Church

&

Dwight 

1,419‌

119‌

119‌

Personal

Products

0.4%

Estee

Lauder,

Class

A 

12,200‌

2,965‌

2,965‌

Total

Consumer

Staples

28,649‌

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

22

Shares

$

Value

(Cost

and

value

in

$000s)

‡

ENERGY

1.9%

Energy

Equipment

&

Services

0.2%

Halliburton 

41,500‌

1,504‌

1,504‌

Oil,

Gas

&

Consumable

Fuels

1.7%

APA 

2,600‌

100‌

Cheniere

Energy 

16,600‌

2,612‌

Coterra

Energy 

57,800‌

1,443‌

Devon

Energy 

48,000‌

2,588‌

Diamondback

Energy 

2,100‌

295‌

Hess 

6,400‌

862‌

Magnolia

Oil

&

Gas,

Class

A 

4,700‌

103‌

Matador

Resources 

1,800‌

97‌

Pioneer

Natural

Resources 

14,200‌

2,846‌

Venture

Global

LNG,

Series

B,

Acquisition

Date:

3/8/18,

Cost $15  (1)(3)(4)

5‌

86‌

Venture

Global

LNG,

Series

C,

Acquisition

Date:

10/16/17

-

3/8/18,

Cost $216  (1)(3)(4)

58‌

993‌

12,025‌

Total

Energy

13,529‌

FINANCIALS

5.2%

Banks

0.1%

First

Republic

Bank 

6,600‌

812‌

SVB

Financial

Group  (1)

500‌

144‌

956‌

Capital

Markets

3.8%

BlackRock 

2,600‌

1,793‌

Blue

Owl

Capital  (2)

60,700‌

749‌

Cboe

Global

Markets 

7,179‌

906‌

Charles

Schwab 

31,583‌

2,461‌

CME

Group 

7,310‌

1,355‌

FactSet

Research

Systems 

1,400‌

580‌

LPL

Financial

Holdings 

5,800‌

1,447‌

MarketAxess

Holdings 

4,760‌

1,625‌

Moody's 

7,461‌

2,165‌

Morningstar 

414‌

86‌

MSCI 

6,600‌

3,446‌

Nasdaq 

1,800‌

101‌

S&P

Global 

23,437‌

7,997‌

Tradeweb

Markets,

Class

A 

28,140‌

1,995‌

26,706‌

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

23

Shares

$

Value

(Cost

and

value

in

$000s)

‡

Consumer

Finance

0.0%

Discover

Financial

Services 

1,800‌

202‌

202‌

Diversified

Financial

Services

0.4%

Apollo

Global

Management 

34,800‌

2,467‌

2,467‌

Insurance

0.9%

Arthur

J

Gallagher 

6,500‌

1,218‌

Assurant 

800‌

102‌

Hartford

Financial

Services

Group 

27,900‌

2,184‌

Marsh

&

McLennan 

12,500‌

2,027‌

Progressive 

6,333‌

909‌

Ryan

Specialty

Group

Holdings  (1)

4,000‌

168‌

6,608‌

Total

Financials

36,939‌

HEALTH

CARE

12.8%

Biotechnology

1.9%

Alnylam

Pharmaceuticals  (1)

2,801‌

536‌

Apellis

Pharmaceuticals  (1)

1,700‌

111‌

Argenx,

ADR  (1)

933‌

341‌

Ascendis

Pharma,

ADR  (1)

600‌

67‌

BioMarin

Pharmaceutical  (1)

3,113‌

310‌

BioNTech,

ADR 

16,528‌

2,149‌

Blueprint

Medicines  (1)

1,200‌

51‌

Exact

Sciences  (1)

2,300‌

143‌

Genmab,

ADR  (1)

24,588‌

924‌

Incyte  (1)

1,359‌

105‌

Karuna

Therapeutics  (1)

500‌

100‌

Legend

Biotech,

ADR  (1)

1,500‌

69‌

Moderna  (1)

4,000‌

555‌

Neurocrine

Biosciences  (1)

1,945‌

201‌

Regeneron

Pharmaceuticals  (1)

3,900‌

2,966‌

Sarepta

Therapeutics  (1)

1,300‌

159‌

Seagen  (1)

2,898‌

521‌

Vertex

Pharmaceuticals  (1)

15,099‌

4,383‌

13,691‌

Health

Care

Equipment

&

Supplies

1.8%

Align

Technology  (1)

2,800‌

866‌

Dexcom  (1)

32,860‌

3,648‌

IDEXX

Laboratories  (1)

2,262‌

1,070‌

Insulet  (1)

4,200‌

1,161‌

Intuitive

Surgical  (1)

11,991‌

2,751‌

Lantheus

Holdings  (1)

1,800‌

133‌

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

24

Shares

$

Value

(Cost

and

value

in

$000s)

‡

Novocure  (1)

3,000‌

231‌

Penumbra  (1)

1,800‌

468‌

QuidelOrtho  (1)

1,100‌

96‌

ResMed 

7,900‌

1,683‌

Shockwave

Medical  (1)

1,000‌

190‌

STERIS 

565‌

106‌

Teleflex 

400‌

95‌

12,498‌

Health

Care

Providers

&

Services

4.5%

Acadia

Healthcare  (1)

2,300‌

167‌

Amedisys  (1)

814‌

75‌

Centene  (1)

11,849‌

811‌

CVS

Health 

14,700‌

1,228‌

Elevance

Health 

8,747‌

4,108‌

HCA

Healthcare 

2,600‌

633‌

Humana 

3,053‌

1,511‌

McKesson 

13,500‌

4,722‌

Molina

Healthcare  (1)

8,314‌

2,289‌

UnitedHealth

Group 

34,600‌

16,468‌

32,012‌

Health

Care

Technology

0.2%

Veeva

Systems,

Class

A  (1)

8,392‌

1,390‌

1,390‌

Life

Sciences

Tools

&

Services

2.8%

Agilent

Technologies 

15,008‌

2,131‌

Avantor  (1)

4,695‌

114‌

Bio-Rad

Laboratories,

Class

A  (1)

1,700‌

812‌

Bio-Techne 

16,400‌

1,191‌

Bruker 

5,200‌

358‌

Charles

River

Laboratories

International  (1)

1,500‌

329‌

Danaher 

12,300‌

3,045‌

IQVIA

Holdings  (1)

5,063‌

1,056‌

Mettler-Toledo

International  (1)

2,213‌

3,173‌

Repligen  (1)

6,500‌

1,133‌

Thermo

Fisher

Scientific 

10,519‌

5,699‌

West

Pharmaceutical

Services 

1,700‌

539‌

19,580‌

Pharmaceuticals

1.6%

Catalent (1)

2,100‌

143‌

Elanco

Animal

Health  (1)

3,614‌

41‌

Eli

Lilly 

25,600‌

7,967‌

Royalty

Pharma,

Class

A 

4,200‌

151‌

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

25

Shares

$

Value

(Cost

and

value

in

$000s)

‡

Zoetis 

18,568‌

3,101‌

11,403‌

Total

Health

Care

90,574‌

INDUSTRIALS

&

BUSINESS

SERVICES

8.4%

Aerospace

&

Defense

0.8%

Axon

Enterprise  (1)

1,000‌

200‌

BWX

Technologies 

1,900‌

116‌

Hexcel 

1,800‌

131‌

Howmet

Aerospace 

4,000‌

169‌

Huntington

Ingalls

Industries 

500‌

108‌

L3Harris

Technologies 

3,617‌

764‌

Northrop

Grumman 

3,700‌

1,717‌

TransDigm

Group 

3,428‌

2,550‌

5,755‌

Air

Freight

&

Logistics

0.8%

Expeditors

International

of

Washington 

1,000‌

105‌

United

Parcel

Service,

Class

B 

31,426‌

5,735‌

5,840‌

Airlines

0.1%

Alaska

Air

Group  (1)

6,000‌

287‌

Southwest

Airlines 

6,500‌

218‌

United

Airlines

Holdings  (1)

1,000‌

52‌

557‌

Building

Products

0.3%

A.O.

Smith 

2,500‌

164‌

Allegion 

2,100‌

237‌

Carrier

Global 

889‌

40‌

Fortune

Brands

Innovations 

1,800‌

111‌

Trane

Technologies 

8,400‌

1,554‌

Trex  (1)

3,500‌

179‌

2,285‌

Commercial

Services

&

Supplies

1.8%

Cintas 

9,100‌

3,990‌

Clean

Harbors  (1)

3,100‌

409‌

Copart  (1)

41,052‌

2,893‌

Republic

Services 

6,500‌

838‌

Ritchie

Bros

Auctioneers 

2,000‌

122‌

Rollins 

23,000‌

810‌

Waste

Connections 

24,710‌

3,309‌

12,371‌

Construction

&

Engineering

0.3%

Quanta

Services 

6,000‌

968‌

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

26

Shares

$

Value

(Cost

and

value

in

$000s)

‡

Valmont

Industries 

2,200‌

698‌

WillScot

Mobile

Mini

Holdings  (1)

4,000‌

206‌

1,872‌

Electrical

Equipment

0.4%

AMETEK 

1,287‌

182‌

Eaton 

10,500‌

1,837‌

Hubbell 

1,600‌

402‌

Rockwell

Automation 

2,472‌

729‌

3,150‌

Industrial

Conglomerates

0.1%

Roper

Technologies 

1,842‌

792‌

792‌

Machinery

0.9%

Cummins 

3,663‌

891‌

Deere 

10,347‌

4,338‌

Graco 

1,700‌

118‌

IDEX 

925‌

208‌

Middleby  (1)

2,100‌

327‌

Otis

Worldwide 

1,500‌

127‌

PACCAR 

2,000‌

144‌

Toro 

1,800‌

199‌

Westinghouse

Air

Brake

Technologies 

1,000‌

104‌

6,456‌

Professional

Services

0.7%

Booz

Allen

Hamilton

Holding 

1,626‌

154‌

CoStar

Group  (1)

22,380‌

1,581‌

Equifax 

5,214‌

1,056‌

FTI

Consulting  (1)

500‌

92‌

Leidos

Holdings 

1,100‌

107‌

TransUnion 

3,100‌

203‌

Verisk

Analytics 

9,181‌

1,571‌

4,764‌

Road

&

Rail

1.4%

Canadian

Pacific

Railway 

21,188‌

1,609‌

JB

Hunt

Transport

Services 

2,309‌

417‌

Landstar

System 

600‌

108‌

Old

Dominion

Freight

Line 

9,067‌

3,076‌

Uber

Technologies  (1)

22,000‌

732‌

Union

Pacific 

18,200‌

3,773‌

9,715‌

Trading

Companies

&

Distributors

0.8%

Fastenal 

25,600‌

1,320‌

Ferguson 

9,600‌

1,383‌

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

27

Shares

$

Value

(Cost

and

value

in

$000s)

‡

SiteOne

Landscape

Supply  (1)

2,700‌

401‌

United

Rentals 

3,700‌

1,734‌

Watsco 

3,568‌

1,087‌

5,925‌

Total

Industrials

&

Business

Services

59,482‌

INFORMATION

TECHNOLOGY

44.9%

Communications

Equipment

0.6%

Arista

Networks  (1)

17,400‌

2,413‌

Motorola

Solutions 

6,800‌

1,787‌

4,200‌

Electronic

Equipment,

Instruments

&

Components

1.7%

Amphenol,

Class

A 

65,794‌

5,100‌

CDW 

24,493‌

4,958‌

Cognex 

2,400‌

114‌

Keysight

Technologies  (1)

3,418‌

547‌

Littelfuse 

393‌

102‌

TE

Connectivity 

1,000‌

127‌

Zebra

Technologies,

Class

A  (1)

2,346‌

704‌

11,652‌

IT

Services

8.8%

Accenture,

Class

A 

25,836‌

6,861‌

Automatic

Data

Processing 

11,000‌

2,418‌

Block  (1)

10,900‌

836‌

Broadridge

Financial

Solutions 

8,561‌

1,205‌

Endava,

ADR  (1)(2)

1,000‌

79‌

EPAM

Systems  (1)

1,237‌

381‌

Euronet

Worldwide  (1)

1,054‌

115‌

Fiserv  (1)

17,000‌

1,956‌

FleetCor

Technologies  (1)

6,800‌

1,461‌

Gartner  (1)

8,100‌

2,655‌

Globant  (1)

600‌

99‌

Mastercard,

Class

A 

43,700‌

15,526‌

MongoDB  (1)

4,500‌

943‌

Paychex 

4,800‌

530‌

Shopify,

Class

A  (1)

36,000‌

1,481‌

Snowflake,

Class

A  (1)

5,046‌

779‌

SS&C

Technologies

Holdings 

2,500‌

147‌

VeriSign  (1)

192‌

38‌

Visa,

Class

A 

111,000‌

24,413‌

WEX  (1)

667‌

129‌

62,052‌

Semiconductors

&

Semiconductor

Equipment

9.3%

Advanced

Micro

Devices  (1)

37,051‌

2,912‌

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

28

Shares

$

Value

(Cost

and

value

in

$000s)

‡

Analog

Devices 

19,575‌

3,592‌

Enphase

Energy  (1)

8,600‌

1,811‌

Entegris 

31,060‌

2,647‌

First

Solar  (1)

700‌

118‌

KLA 

26,776‌

10,158‌

Lam

Research 

4,260‌

2,070‌

Lattice

Semiconductor  (1)

3,327‌

283‌

Marvell

Technology 

6,300‌

285‌

Microchip

Technology 

58,822‌

4,766‌

MKS

Instruments 

900‌

87‌

Monolithic

Power

Systems 

9,912‌

4,800‌

NVIDIA 

96,000‌

22,287‌

ON

Semiconductor  (1)

29,500‌

2,284‌

QUALCOMM 

37,575‌

4,642‌

Silicon

Laboratories  (1)

600‌

107‌

Skyworks

Solutions 

1,007‌

112‌

Synaptics  (1)

800‌

94‌

Taiwan

Semiconductor

Manufacturing,

ADR 

21,800‌

1,898‌

Teradyne 

3,000‌

303‌

65,256‌

Software

15.7%

Adobe (1)

10,500‌

3,402‌

ANSYS  (1)

2,000‌

607‌

AppLovin,

Class

A  (1)

1,500‌

20‌

Aspen

Technology  (1)

1,042‌

221‌

Atlassian,

Class

A  (1)

5,391‌

886‌

Autodesk  (1)

7,791‌

1,548‌

Bentley

Systems,

Class

B 

3,949‌

160‌

BILL

Holdings  (1)

6,792‌

575‌

Black

Knight  (1)

22,000‌

1,311‌

Cadence

Design

Systems  (1)

18,789‌

3,625‌

Canva,

Acquisition

Date:

8/16/21

-

11/4/21,

Cost $719  (1)(3)(4)

422‌

233‌

CCC

Intelligent

Solutions

Holdings  (1)

6,257‌

56‌

Ceridian

HCM

Holding  (1)

3,063‌

223‌

Confluent,

Class

A  (1)

2,528‌

62‌

Crowdstrike

Holdings,

Class

A  (1)

15,554‌

1,877‌

Databricks,

Acquisition

Date:

7/24/20

-

8/28/20,

Cost $82  (1)(3)(4)

5,133‌

308‌

Datadog,

Class

A  (1)

11,949‌

914‌

Descartes

Systems

Group  (1)

2,500‌

184‌

DoubleVerify

Holdings  (1)

3,400‌

89‌

Dynatrace  (1)

2,448‌

104‌

Fair

Isaac  (1)

1,300‌

881‌

Fortinet  (1)

83,000‌

4,934‌

Gitlab,

Class

A  (1)

2,220‌

98‌

HubSpot  (1)

1,600‌

619‌

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

29

Shares

$

Value

(Cost

and

value

in

$000s)

‡

Informatica,

Class

A  (1)(2)

5,200‌

90‌

Intuit 

14,500‌

5,904‌

Manhattan

Associates  (1)

3,400‌

489‌

Microsoft 

229,625‌

57,273‌

nCino  (1)

2,500‌

68‌

Palo

Alto

Networks  (1)

18,800‌

3,541‌

Paycom

Software  (1)

7,348‌

2,124‌

Paycor

HCM  (1)

3,700‌

92‌

Paylocity

Holding  (1)

3,500‌

674‌

Procore

Technologies  (1)

1,582‌

106‌

PTC  (1)

10,400‌

1,303‌

Salesforce  (1)

6,095‌

997‌

Samsara,

Class

A  (1)

8,500‌

142‌

ServiceNow  (1)

8,800‌

3,803‌

Snyk,

Acquisition

Date:

9/3/21,

Cost $144  (1)(3)(4)

10,031‌

115‌

Socure,

Acquisition

Date:

12/22/21,

Cost $159  (1)(3)(4)

9,912‌

74‌

Synopsys  (1)

18,227‌

6,630‌

Tanium,

Class

B,

Acquisition

Date:

9/24/20,

Cost $52  (1)(3)(4)

4,598‌

20‌

Tyler

Technologies  (1)

6,294‌

2,022‌

Workday,

Class

A  (1)

8,500‌

1,577‌

Workiva  (1)

487‌

44‌

Zscaler  (1)

7,200‌

944‌

110,969‌

Technology

Hardware,

Storage

&

Peripherals

8.8%

Apple 

420,500‌

61,986‌

Pure

Storage,

Class

A  (1)

4,000‌

114‌

62,100‌

Total

Information

Technology

316,229‌

MATERIALS

2.0%

Chemicals

1.3%

Air

Products

&

Chemicals 

2,400‌

686‌

Albemarle 

4,400‌

1,119‌

CF

Industries

Holdings 

7,000‌

601‌

Corteva 

22,000‌

1,371‌

Linde 

6,100‌

2,125‌

Nutrien 

9,700‌

755‌

PPG

Industries 

3,500‌

462‌

RPM

International 

1,300‌

115‌

Sherwin-Williams 

9,814‌

2,172‌

9,406‌

Construction

Materials

0.3%

Vulcan

Materials 

10,300‌

1,863‌

1,863‌

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

30

Shares

$

Value

(Cost

and

value

in

$000s)

‡

Containers

&

Packaging

0.2%

Avery

Dennison 

1,982‌

361‌

Ball 

15,800‌

888‌

Sealed

Air 

5,000‌

243‌

1,492‌

Metals

&

Mining

0.2%

BHP

Group,

ADR  (2)

12,000‌

732‌

Steel

Dynamics 

2,500‌

315‌

1,047‌

Total

Materials

13,808‌

REAL

ESTATE

1.3%

Equity

Real

Estate

Investment

Trusts

1.3%

Alexandria

Real

Estate

Equities,

REIT 

500‌

75‌

CubeSmart,

REIT 

44,700‌

2,100‌

Equity

LifeStyle

Properties,

REIT 

14,000‌

959‌

Lamar

Advertising,

Class

A,

REIT 

1,816‌

190‌

Rexford

Industrial

Realty,

REIT 

1,700‌

103‌

SBA

Communications,

REIT 

19,000‌

4,928‌

Simon

Property

Group,

REIT 

4,000‌

488‌

Total

Real

Estate

8,843‌

UTILITIES

0.0%

Independent

Power

&

Renewable

Electricity

Producer

0.0%

Vistra 

2,000‌

44‌

Total

Utilities

44‌

Total

Common

Stocks

(Cost

$374,951)

701,426‌

CONVERTIBLE

PREFERRED

STOCKS

0.4%

HEALTH

CARE

0.0%

Biotechnology

0.0%

Caris

Life

Sciences,

Series

D,

Acquisition

Date:

5/11/21,

Cost $137  (1)(3)(4)

16,937‌

112‌

Total

Health

Care

112‌

INFORMATION

TECHNOLOGY

0.4%

Software

0.4%

Canva,

Series

A,

Acquisition

Date:

11/4/21,

Cost $43  (1)(3)(4)

25‌

14‌

Databricks,

Series

F,

Acquisition

Date:

10/22/19,

Cost $223  (1)(3)

(4)

15,573‌

934‌

Databricks,

Series

G,

Acquisition

Date:

2/1/21,

Cost $252  (1)(3)(4)

4,257‌

256‌

Databricks,

Series

H,

Acquisition

Date:

8/31/21,

Cost $818  (1)(3)

(4)

11,136‌

668‌

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

31

Shares

$

Value

(Cost

and

value

in

$000s)

‡

DataRobot,

Series

G,

Acquisition

Date:

6/11/21,

Cost $186  (1)(3)

(4)

6,806‌

26‌

Rappi,

Series

E,

Acquisition

Date:

9/8/20,

Cost $523  (1)(3)(4)

8,757‌

315‌

Snyk,

Series

F,

Acquisition

Date:

9/3/21,

Cost $240  (1)(3)(4)

16,810‌

193‌

Socure,

Series

A,

Acquisition

Date:

12/22/21,

Cost $194  (1)(3)(4)

12,046‌

90‌

Socure,

Series

A-1,

Acquisition

Date:

12/22/21,

Cost $159  (1)(3)(4)

9,887‌

74‌

Socure,

Series

B,

Acquisition

Date:

12/22/21,

Cost $3  (1)(3)(4)

178‌

1‌

Socure,

Series

E,

Acquisition

Date:

10/27/21,

Cost $368  (1)(3)(4)

22,915‌

172‌

Tanium,

Series

G,

Acquisition

Date:

8/26/15,

Cost $141  (1)(3)(4)

28,431‌

125‌

Total

Information

Technology

2,868‌

Total

Convertible

Preferred

Stocks

(Cost

$3,287)

2,980‌

SHORT-TERM

INVESTMENTS

0.0%

Money

Market

Funds

0.0%

T.

Rowe

Price

Government

Reserve

Fund,

4.60%  (5)(6)

82,060‌

82‌

Total

Short-Term

Investments

(Cost

$82)

82‌

SECURITIES

LENDING

COLLATERAL

1.1%

INVESTMENTS

IN

A

POOLED

ACCOUNT

THROUGH

SECURITIES

LENDING

PROGRAM

WITH

STATE

STREET

BANK

AND

TRUST

COMPANY

1.1%

Money

Market

Funds

1.1%

T.

Rowe

Price

Government

Reserve

Fund,

4.60%  (5)(6)

7,679,019‌

7,679‌

Total

Investments

in

a

Pooled

Account

through

Securities

Lending

Program

with

State

Street

Bank

and

Trust

Company

7,679‌

Total

Securities

Lending

Collateral

(Cost

$7,679)

7,679‌

Total

Investments

in

Securities

101.0%

of

Net

Assets

(Cost

$385,999)

$

712,167‌

‡

Shares

are

denominated

in

U.S.

dollars

unless

otherwise

noted.

(1)

Non-income

producing

(2)

See

Note

3

.

All

or

a

portion

of

this

security

is

on

loan

at

February

28,

2023.

(3)

See

Note

2.

Level

3

in

fair

value

hierarchy.

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

32

.

.

.

.

.

.

.

.

.

.

(4)

Security

cannot

be

offered

for

public

resale

without

first

being

registered

under

the

Securities

Act

of

1933

and

related

rules

("restricted

security").

Acquisition

date

represents

the

day

on

which

an

enforceable

right

to

acquire

such

security

is

obtained

and

is

presented

along

with

related

cost

in

the

security

description.

The

fund

may

have

registration

rights

for

certain

restricted

securities.

Any

costs

related

to

such

registration

are

generally

borne

by

the

issuer.

The

aggregate

value

of

restricted

securities

(excluding

144A

holdings)

at

period

end

amounts

to

$4,809

and

represents

0.7%

of

net

assets.

(5)

Seven-day

yield

(6)

Affiliated

Companies

ADR

American

Depositary

Receipts

REIT

A

domestic

Real

Estate

Investment

Trust

whose

distributions

pass-through

with

original

tax

character

to

the

shareholder

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

33

The

accompanying

notes

are

an

integral

part

of

these

financial

statements.

AFFILIATED

COMPANIES

($000s)

The

fund

may

invest

in

certain

securities

that

are

considered

affiliated

companies.

As

defined

by

the

1940

Act,

an

affiliated

company

is

one

in

which

the

fund

owns

5%

or

more

of

the

outstanding

voting

securities,

or

a

company

that

is

under

common

ownership

or

control.

The

following

securities

were

considered

affiliated

companies

for

all

or

some

portion

of

the

year

ended

February

28,

2023.

Net

realized

gain

(loss),

investment

income,

change

in

net

unrealized

gain/loss,

and

purchase

and

sales

cost

reflect

all

activity

for

the

period

then

ended.

Affiliate

Net

Realized

Gain

(Loss)

Change

in

Net

Unrealized

Gain/Loss

Investment

Income

T.

Rowe

Price

Government

Reserve

Fund,

4.60%

$

—‌

$

—‌

$

15‌++

Totals

$

—‌#

$

—‌

$

15‌+

Supplementary

Investment

Schedule

Affiliate

Value

02/28/22

Purchase

Cost

Sales

Cost

Value

02/28/23

T.

Rowe

Price

Government

Reserve

Fund,

4.60%

$

6,286‌

 ¤

  ¤

$

7,761‌

Total

$

7,761‌^

#

Capital

gain

distributions

from

underlying

Price

funds

represented

$0

of

the

net

realized

gain

(loss).

++

Excludes

earnings

on

securities

lending

collateral,

which

are

subject

to

rebates

and

fees

as

described

in

Note

3

.

+

Investment

income

comprised

$15

of

dividend

income

and

$0

of

interest

income.

¤

Purchase

and

sale

information

not

shown

for

cash

management

funds.

^

The

cost

basis

of

investments

in

affiliated

companies

was

$7,761.

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

February

28,

2023

Statement

of

Assets

and

Liabilities

34

($000s,

except

shares

and

per

share

amounts)

The

accompanying

notes

are

an

integral

part

of

these

financial

statements.

Assets

Investments

in

securities,

at

value

(cost

$385,999)

$

712,167‌

Receivable

for

investment

securities

sold

1,087‌

Dividends

receivable

600‌

Receivable

for

shares

sold

157‌

Other

assets

116‌

Total

assets

714,127‌

Liabilities

Obligation

to

return

securities

lending

collateral

7,752‌

Payable

for

investment

securities

purchased

786‌

Investment

management

fees

payable

354‌

Payable

for

shares

redeemed

140‌

Due

to

affiliates

17‌

Other

liabilities

76‌

Total

liabilities

9,125‌

NET

ASSETS

$

705,002‌

Net

Assets

Consist

of:

Total

distributable

earnings

(loss)

$

315,979‌

Paid-in

capital

applicable

to

15,845,152

shares

of

$0.0001

par

value

capital

stock

outstanding;

1,000,000,000

shares

of

the

Corporation

authorized

389,023‌

NET

ASSETS

$

705,002‌

NET

ASSET

VALUE

PER

SHARE

Investor

Class

($250,732,857

/

5,643,103

shares

outstanding)

$

44.43‌

I

Class

($454,269,570

/

10,202,049

shares

outstanding)

$

44.53‌

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

Statement

of

Operations

35

($000s)

The

accompanying

notes

are

an

integral

part

of

these

financial

statements.

Year

Ended

2/28/23

Investment

Income

(Loss)

Income

Dividend

(net

of

foreign

taxes

of

$35)

$

5,987‌

Other,

non

cash

387‌

Securities

lending

16‌

Total

income

6,390‌

Expenses

Investment

management

4,626‌

Shareholder

servicing

Investor

Class

$

434‌

I

Class

83‌

517‌

Prospectus

and

shareholder

reports

Investor

Class

22‌

I

Class

11‌

33‌

Custody

and

accounting

200‌

Registration

68‌

Legal

and

audit

33‌

Directors

2‌

Miscellaneous

22‌

Waived

/

paid

by

Price

Associates

(67‌)

Total

expenses

5,434‌

Net

investment

income

956‌

Realized

and

Unrealized

Gain

/

Loss

–

Net

realized

loss

on

securities

(7,401‌)

Change

in

net

unrealized

gain

/

loss

on

securities

(113,384‌)

Net

realized

and

unrealized

gain

/

loss

(120,785‌)

DECREASE

IN

NET

ASSETS

FROM

OPERATIONS

$

(119,829‌)

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

Statement

of

Changes

in

Net

Assets

36

($000s)

Year

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

Ended

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

2/28/23

2/28/22

Increase

(Decrease)

in

Net

Assets

Operations

Net

investment

income

(loss)

$

956‌

$

(1,941‌)

Net

realized

gain

(loss)

(7,401‌)

15,118‌

Change

in

net

unrealized

gain

/

loss

(113,384‌)

14,033‌

Increase

(decrease)

in

net

assets

from

operations

(119,829‌)

27,210‌

Distributions

to

shareholders

Net

earnings

Investor

Class

(2,148‌)

(14,675‌)

I

Class

(4,239‌)

(5,214‌)

Decrease

in

net

assets

from

distributions

(6,387‌)

(19,889‌)

Capital

share

transactions

*

Shares

sold

Investor

Class

40,068‌

92,874‌

I

Class

148,920‌

291,242‌

Distributions

reinvested

Investor

Class

2,003‌

13,333‌

I

Class

3,657‌

4,179‌

Shares

redeemed

Investor

Class

(148,653‌)

(326,451‌)

I

Class

(57,132‌)

(12,326‌)

Increase

(decrease)

in

net

assets

from

capital

share

transactions

(11,137‌)

62,851‌

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

Statement

of

Changes

in

Net

Assets

37

($000s)

The

accompanying

notes

are

an

integral

part

of

these

financial

statements.

Year

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

Ended

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

2/28/23

2/28/22

Net

Assets

Increase

(decrease)

during

period

(137,353‌)

70,172‌

Beginning

of

period

842,355‌

772,183‌

End

of

period

$

705,002‌

$

842,355‌

*Share

information

(000s)

Shares

sold

Investor

Class

883‌

1,619‌

I

Class

3,178‌

5,552‌

Distributions

reinvested

Investor

Class

47‌

222‌

I

Class

85‌

70‌

Shares

redeemed

Investor

Class

(3,172‌)

(6,187‌)

I

Class

(1,268‌)

(219‌)

Increase

(decrease)

in

shares

outstanding

(247‌)

1,057‌

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

NOTES

TO

FINANCIAL

STATEMENTS

38

T.

Rowe

Price

Tax-Efficient

Funds,

Inc.

(the

corporation) is

registered

under

the

Investment

Company

Act

of

1940

(the

1940

Act).

The

Tax-Efficient

Equity

Fund

(the

fund)

is a

diversified,

open-end

management

investment

company

established

by

the

corporation. The

fund

seeks

to

maximize

after-tax

growth

of

capital

through

investments

primarily

in

common

stocks.

The

fund

has

two classes

of

shares:

the

Tax-Efficient

Equity

Fund

(Investor

Class)

and

the

Tax-Efficient

Equity

Fund–I

Class

(I

Class).

I

Class

shares

require

a

$500,000

initial

investment

minimum,

although

the

minimum

generally

is

waived

or

reduced

for

financial

intermediaries,

eligible

retirement

plans,

and

certain

other

accounts.

Prior

to

November

15,

2021,

the

initial

investment

minimum

was

$1

million

and

was

generally

waived

for

financial

intermediaries,

eligible

retirement

plans,

and

other

certain

accounts.

As

a

result

of

the

reduction

in

the

I

Class

minimum,

certain

assets

transferred

from

the

Investor

Class

to

the

I

Class.

This

transfer

of

shares

from

Investor

Class

to

I

Class

is

reflected

in

the

Statement

of

Changes

in

Net

Assets

within

the

Capital

shares

transactions

as

Shares

redeemed

and

Shares

sold,

respectively. Each

class

has

exclusive

voting

rights

on

matters

related

solely

to

that

class;

separate

voting

rights

on

matters

that

relate

to

both

classes;

and,

in

all

other

respects,

the

same

rights

and

obligations

as

the

other

class.

NOTE

1

-

SIGNIFICANT

ACCOUNTING

POLICIES 

Basis

of

Preparation

 The fund

is

an

investment

company

and

follows

accounting

and

reporting

guidance

in

the

Financial

Accounting

Standards

Board

(FASB)

Accounting

Standards

Codification

Topic

946

(ASC

946).

The

accompanying

financial

statements

were

prepared

in

accordance

with

accounting

principles

generally

accepted

in

the

United

States

of

America

(GAAP),

including,

but

not

limited

to,

ASC

946.

GAAP

requires

the

use

of

estimates

made

by

management.

Management

believes

that

estimates

and

valuations

are

appropriate;

however,

actual

results

may

differ

from

those

estimates,

and

the

valuations

reflected

in

the

accompanying

financial

statements

may

differ

from

the

value

ultimately

realized

upon

sale

or

maturity.

Investment

Transactions,

Investment

Income,

and

Distributions

Investment

transactions

are

accounted

for

on

the

trade

date

basis.

Income

and

expenses

are

recorded

on

the

accrual

basis.

Realized

gains

and

losses

are

reported

on

the

identified

cost

basis.

Income

tax-related

interest

and

penalties,

if

incurred,

are

recorded

as

income

tax

expense.

Dividends

received

from

mutual

fund

investments

are

reflected

as

dividend

income;

capital

gain

distributions

are

reflected

as

realized

gain/loss.

Dividend

income

and

capital

gain

distributions

are

recorded

on

the

ex-dividend

date.

Distributions

from

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

39

REITs

are

initially

recorded

as

dividend

income

and,

to

the

extent

such

represent

a

return

of

capital

or

capital

gain

for

tax

purposes,

are

reclassified

when

such

information

becomes

available.

Non-cash

dividends,

if

any,

are

recorded

at

the

fair

market

value

of

the

asset

received.

Proceeds

from

litigation

payments,

if

any,

are

included

in

either

net

realized

gain

(loss)

or

change

in

net

unrealized

gain/loss

from

securities.

Distributions

to

shareholders

are

recorded

on

the

ex-dividend

date.

Income

distributions,

if

any,

are

declared

and

paid

by

each

class annually.

A

capital

gain

distribution,

if

any, may

also

be

declared

and

paid

by

the

fund

annually.

Class

Accounting

 Shareholder

servicing,

prospectus,

and

shareholder

report

expenses

incurred

by

each

class

are

charged

directly

to

the

class

to

which

they

relate.

Expenses

common

to all classes,

investment

income,

and

realized

and

unrealized

gains

and

losses

are

allocated

to

the

classes

based

upon

the

relative

daily

net

assets

of

each

class.

Capital

Transactions

 Each

investor’s

interest

in

the

net

assets

of the

fund

is

represented

by

fund

shares. The

fund’s

net

asset

value

(NAV)

per

share

is

computed

at

the

close

of

the

New

York

Stock

Exchange

(NYSE),

normally

4

p.m.

ET,

each

day

the

NYSE

is

open

for

business.

However,

the

NAV

per

share

may

be

calculated

at

a

time

other

than

the

normal

close

of

the

NYSE

if

trading

on

the

NYSE

is

restricted,

if

the

NYSE

closes

earlier,

or

as

may

be

permitted

by

the

SEC.

Purchases

and

redemptions

of

fund

shares

are

transacted

at

the

next-computed

NAV

per

share,

after

receipt

of

the

transaction

order

by

T.

Rowe

Price

Associates,

Inc.,

or

its

agents.

New

Accounting

Guidance

 In

June

2022,

the

FASB

issued

Accounting

Standards

Update

(ASU),

ASU

2022-03,

Fair

Value

Measurement

(Topic

820)

–

Fair

Value

Measurement

of

Equity

Securities

Subject

to

Contractual

Sale

Restrictions,

which

clarifies

that

a

contractual

restriction

on

the

sale

of

an

equity

security

is

not

considered

part

of

the

unit

of

account

of

the

equity

security

and,

therefore,

is

not

considered

in

measuring

fair

value.

The

amendments

under

this

ASU

are

effective

for

fiscal

years

beginning

after

December

15,

2023;

however,

the

fund

opted

to

early

adopt,

as

permitted,

effective

December

1,

2022. Adoption

of

the

guidance

did not

have

a

material

impact

on

the fund's

financial  statements.

Indemnification

 In

the

normal

course

of

business, the

fund

may

provide

indemnification

in

connection

with

its

officers

and

directors,

service

providers,

and/or

private

company

investments. The

fund’s

maximum

exposure

under

these

arrangements

is

unknown;

however,

the

risk

of

material

loss

is

currently

considered

to

be

remote.

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

40

NOTE

2

-

VALUATION 

Fair

Value

  The

fund’s

financial

instruments

are

valued

at

the

close

of

the

NYSE

and

are

reported

at

fair

value,

which

GAAP

defines

as

the

price

that

would

be

received

to

sell

an

asset

or

paid

to

transfer

a

liability

in

an

orderly

transaction

between

market

participants

at

the

measurement

date. The fund’s

Board

of

Directors

(the

Board)

has

designated

T.

Rowe

Price

Associates,

Inc.

as

the

fund’s

valuation

designee

(Valuation

Designee).

Subject

to

oversight

by

the

Board,

the

Valuation

Designee

performs

the

following

functions

in

performing

fair

value

determinations:

assesses

and

manages

valuation

risks;

establishes

and

applies

fair

value

methodologies;

tests

fair

value

methodologies;

and

evaluates

pricing

vendors

and

pricing

agents.

The

duties

and

responsibilities

of

the

Valuation

Designee

are

performed

by

its

Valuation

Committee. The

Valuation

Designee provides

periodic

reporting

to

the

Board

on

valuation

matters.

Various

valuation

techniques

and

inputs

are

used

to

determine

the

fair

value

of

financial

instruments.

GAAP

establishes

the

following

fair

value

hierarchy

that

categorizes

the

inputs

used

to

measure

fair

value:

Level

1

–

quoted

prices

(unadjusted)

in

active

markets

for

identical

financial

instruments

that

the

fund

can

access

at

the

reporting

date

Level

2

–

inputs

other

than

Level

1

quoted

prices

that

are

observable,

either

directly

or

indirectly

(including,

but

not

limited

to,

quoted

prices

for

similar

financial

instruments

in

active

markets,

quoted

prices

for

identical

or

similar

financial

instruments

in

inactive

markets,

interest

rates

and

yield

curves,

implied

volatilities,

and

credit

spreads)

Level

3

–

unobservable

inputs

(including

the Valuation

Designee’s assumptions

in

determining

fair

value)

Observable

inputs

are

developed

using

market

data,

such

as

publicly

available

information

about

actual

events

or

transactions,

and

reflect

the

assumptions

that

market

participants

would

use

to

price

the

financial

instrument.

Unobservable

inputs

are

those

for

which

market

data

are

not

available

and

are

developed

using

the

best

information

available

about

the

assumptions

that

market

participants

would

use

to

price

the

financial

instrument.

GAAP

requires

valuation

techniques

to

maximize

the

use

of

relevant

observable

inputs

and

minimize

the

use

of

unobservable

inputs.

When

multiple

inputs

are

used

to

derive

fair

value,

the

financial

instrument

is

assigned

to

the

level

within

the

fair

value

hierarchy

based

on

the

lowest-level

input

that

is

significant

to

the

fair

value

of

the

financial

instrument.

Input

levels

are

not

necessarily

an

indication

of

the

risk

or

liquidity

associated

with

financial

instruments

at

that

level

but

rather

the

degree

of

judgment

used

in

determining

those

values.

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

41

Valuation

Techniques 

Equity

securities,

including

exchange-traded

funds, listed

or

regularly

traded

on

a

securities

exchange

or

in

the

over-the-counter

(OTC)

market

are

valued

at

the

last

quoted

sale

price

or,

for

certain

markets,

the

official

closing

price

at

the

time

the

valuations

are

made.

OTC

Bulletin

Board

securities

are

valued

at

the

mean

of

the

closing

bid

and

asked

prices.

A

security

that

is

listed

or

traded

on

more

than

one

exchange

is

valued

at

the

quotation

on

the

exchange

determined

to

be

the

primary

market

for

such

security.

Listed

securities

not

traded

on

a

particular

day

are

valued

at

the

mean

of

the

closing

bid

and

asked

prices

for

domestic

securities

.

Investments

in

mutual

funds

are

valued

at

the

mutual

fund’s

closing

NAV

per

share

on

the

day

of

valuation.

Assets

and

liabilities

other

than

financial

instruments,

including

short-term

receivables

and

payables,

are

carried

at

cost,

or

estimated

realizable

value,

if

less,

which

approximates

fair

value. 

Investments

for

which

market

quotations are

not

readily

available

or

deemed

unreliable

are

valued

at

fair

value

as

determined

in

good

faith

by

the

Valuation

Designee.

The

Valuation

Designee

has

adopted

methodologies

for

determining

the

fair

value

of

investments

for

which

market

quotations

are

not

readily

available

or

deemed

unreliable,

including

the

use

of

other

pricing

sources.

Factors

used

in

determining

fair

value

vary

by

type

of

investment

and

may

include

market

or

investment

specific

considerations.

The

Valuation

Designee typically

will

afford

greatest

weight

to

actual

prices

in

arm’s

length

transactions,

to

the

extent

they

represent

orderly

transactions

between

market

participants,

transaction

information

can

be

reliably

obtained,

and

prices

are

deemed

representative

of

fair

value.

However,

the

Valuation

Designee may

also

consider

other

valuation

methods

such

as

market-based

valuation

multiples;

a

discount

or

premium

from

market

value

of

a

similar,

freely

traded

security

of

the

same

issuer;

discounted

cash

flows;

yield

to

maturity;

or

some

combination.

Fair

value

determinations

are

reviewed

on

a

regular

basis.

Because

any

fair

value

determination

involves

a

significant

amount

of

judgment,

there

is

a

degree

of

subjectivity

inherent

in

such

pricing

decisions. Fair

value

prices

determined

by

the

Valuation

Designee could

differ

from

those

of

other

market

participants,

and

it

is

possible

that

the

fair

value

determined

for

a

security

may

be

materially

different

from

the

value

that

could

be

realized

upon

the

sale

of

that

security.

T.

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PRICE

Tax-Efficient

Equity

Fund

42

Valuation

Inputs

  The

following

table

summarizes

the

fund’s

financial

instruments,

based

on

the

inputs

used

to

determine

their

fair

values

on

February

28,

2023

(for

further

detail

by

category,

please

refer

to

the

accompanying

Portfolio

of

Investments):

NOTE

3

-

OTHER

INVESTMENT

TRANSACTIONS 

Consistent

with

its

investment

objective,

the

fund

engages

in

the

following

practices

to

manage

exposure

to

certain

risks

and/or

to

enhance

performance.

The

investment

objective,

policies,

program,

and

risk

factors

of

the

fund

are

described

more

fully

in

the

fund’s

prospectus

and

Statement

of

Additional

Information.

Restricted

Securities

 The

fund

invests

in

securities

that

are

subject

to

legal

or

contractual

restrictions

on

resale.

Prompt

sale

of

such

securities

at

an

acceptable

price

may

be

difficult

and

may

involve

substantial

delays

and

additional

costs.

Securities

Lending

 The fund

may

lend

its

securities

to

approved

borrowers

to

earn

additional

income.

Its

securities

lending

activities

are

administered

by

a

lending

agent

in

accordance

with

a

securities

lending

agreement.

Security

loans

generally

do

not

have

stated

maturity

dates,

and

the

fund

may

recall

a

security

at

any

time.

The

fund

receives

collateral

in

the

form

of

cash

or

U.S.

government

securities.

Collateral

is

maintained

over

the

life

of

the

loan

in

an

amount

not

less

than

the

value

of

loaned

securities;

any

additional

collateral

required

due

to

changes

in

security

values

is

delivered

to

the

fund

the

next

business

day.

Cash

collateral

is

invested

in

accordance

with

investment

guidelines

approved

by

fund

management.

Additionally,

the

lending

agent

indemnifies

the

fund

against

losses

resulting

from

borrower

default.

Although

risk

is

mitigated

by

the

collateral

and

indemnification,

the

fund

could

experience

a

delay

in

recovering

its

securities

and

a

possible

loss

of

income

or

value

if

the

borrower

fails

to

return

the

securities,

collateral

investments

decline

in

value,

and

the

lending

agent

fails

to

perform.

($000s)

Level

1

Level

2

Level

3

Total

Value

Assets

Common

Stocks

$

699,597‌

$

—‌

$

1,829‌

$

701,426‌

Convertible

Preferred

Stocks

—‌

—‌

2,980‌

2,980‌

Short-Term

Investments

82‌

—‌

—‌

82‌

Securities

Lending

Collateral

7,679‌

—‌

—‌

7,679‌

Total

$

707,358‌

$

—‌

$

4,809‌

$

712,167‌

T.

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PRICE

Tax-Efficient

Equity

Fund

43

Securities

lending

revenue

consists

of

earnings

on

invested

collateral

and

borrowing

fees,

net

of

any

rebates

to

the

borrower,

compensation

to

the

lending

agent,

and

other

administrative

costs.

In

accordance

with

GAAP,

investments

made

with

cash

collateral

are

reflected

in

the

accompanying

financial

statements,

but

collateral

received

in

the

form

of

securities

is

not.

At

February

28,

2023,

the

value

of

loaned

securities

was

$7,494,000;

the

value

of

cash

collateral

and

related

investments

was

$7,752,000.

Other 

Purchases

and

sales

of

portfolio

securities

other

than

short-term securities

aggregated $155,572,000 and

$172,824,000,

respectively,

for

the

year ended

February

28,

2023.

NOTE

4

-

FEDERAL

INCOME

TAXES

Generally,

no

provision

for

federal

income

taxes

is

required

since

the

fund

intends

to

continue

to

qualify

as

a

regulated

investment

company

under

Subchapter

M

of

the

Internal

Revenue

Code

and

distribute

to

shareholders

all

of

its

taxable

income

and

gains.

Distributions

determined

in

accordance

with

federal

income

tax

regulations

may

differ

in

amount

or

character

from

net

investment

income

and

realized

gains

for

financial

reporting

purposes.

The fund

files

U.S.

federal,

state,

and

local

tax

returns

as

required. The

fund’s

tax

returns

are

subject

to

examination

by

the

relevant

tax

authorities

until

expiration

of

the

applicable

statute

of

limitations,

which

is

generally

three

years

after

the

filing

of

the

tax

return

but

which

can

be

extended

to

six

years

in

certain

circumstances.

Tax

returns

for

open

years

have

incorporated

no

uncertain

tax

positions

that

require

a

provision

for

income

taxes.

Capital

accounts

within

the

financial

reporting

records

are

adjusted

for

permanent

book/tax

differences

to

reflect

tax

character

but

are

not

adjusted

for

temporary

differences.

The

permanent

book/tax

adjustments,

if

any,

have

no

impact

on

results

of

operations

or

net

assets.

T.

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PRICE

Tax-Efficient

Equity

Fund

44

The

tax

character

of

distributions

paid

for

the

periods

presented

was

as

follows:

At

February

28,

2023,

the

tax-basis

cost

of

investments

(including

derivatives,

if

any)

and

gross

unrealized

appreciation

and

depreciation

were

as

follows:

At

February

28,

2023,

the

tax-basis

components

of

accumulated

net

earnings

(loss)

were

as

follows:

Temporary

differences

between

book-basis

and

tax-basis

components

of

total

distributable

earnings

(loss)

arise

when

certain

items

of

income,

gain,

or

loss

are

recognized

in

different

periods

for

financial

statement

purposes

versus

for

tax

purposes;

these

differences

will

reverse

in

a

subsequent

reporting

period.

The

temporary

differences

relate

primarily

to

the

deferral

of

losses

from

wash

sales.

The

loss

carryforwards

and

deferrals

primarily

relate

to

capital

loss

carryforwards.

Capital

loss

carryforwards

are

available

indefinitely

to

offset

future

realized

capital

gains.

($000s)

February

28,

2023

February

28,

2022

Ordinary

income

(including

short-term

capital

gains,

if

any)

$

509‌

$

—‌

Long-term

capital

gain

5,878‌

19,889‌

Total

distributions

$

6,387‌

$

19,889‌

($000s)

Cost

of

investments

$

386,670‌

Unrealized

appreciation

$

333,246‌

Unrealized

depreciation

(7,749‌)

Net

unrealized

appreciation

(depreciation)

$

325,497‌

($000s)

Undistributed

ordinary

income

$

433‌

Net

unrealized

appreciation

(depreciation)

325,497‌

Loss

carryforwards

and

deferrals

(9,951‌)

Total

distributable

earnings

(loss)

$

315,979‌

T.

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PRICE

Tax-Efficient

Equity

Fund

45

NOTE

5

-

FOREIGN  TAXES

The

fund

is

subject

to

foreign

income

taxes

imposed

by

certain

countries

in

which

it

invests.

Additionally,

capital

gains

realized

upon

disposition

of

securities

issued

in

or

by

certain

foreign

countries

are

subject

to

capital

gains

tax

imposed

by

those

countries.

All

taxes

are

computed

in

accordance

with

the

applicable

foreign

tax

law,

and,

to

the

extent

permitted,

capital

losses

are

used

to

offset

capital

gains.

Taxes

attributable

to

income

are

accrued

by

the

fund

as

a

reduction

of

income.

Current

and

deferred

tax

expense

attributable

to

capital

gains

is

reflected

as

a

component

of

realized

or

change

in

unrealized

gain/loss

on

securities

in

the

accompanying

financial

statements.

To

the

extent

that

the

fund

has

country

specific

capital

loss

carryforwards,

such

carryforwards

are

applied

against

net

unrealized

gains

when

determining

the

deferred

tax

liability.

Any

deferred

tax

liability

incurred

by

the

fund

is

included

in

either

Other

liabilities

or

Deferred

tax

liability

on

the

accompanying

Statement

of

Assets

and

Liabilities.

NOTE

6

-

RELATED

PARTY

TRANSACTIONS

The

fund

is

managed

by

T.

Rowe

Price

Associates,

Inc.

(Price

Associates),

a

wholly

owned

subsidiary

of

T.

Rowe

Price

Group,

Inc.

(Price

Group).

The

investment

management

agreement

between

the

fund

and

Price

Associates

provides

for

an

annual

investment

management

fee,

which

is

computed

daily

and

paid

monthly. The

fee

consists

of

an

individual

fund

fee,

equal

to

0.35%

of

the

fund’s

average

daily

net

assets,

and

a

group

fee.

The

group

fee

rate

is

calculated

based

on

the

combined

net

assets

of

certain

mutual

funds

sponsored

by

Price

Associates

(the

group)

applied

to

a

graduated

fee

schedule,

with

rates

ranging

from

0.48%

for

the

first

$1

billion

of

assets

to

0.260%

for

assets

in

excess

of

$845

billion.

The

fund’s

group

fee

is

determined

by

applying

the

group

fee

rate

to

the

fund’s

average

daily

net

assets. At

February

28,

2023,

the

effective

annual

group

fee

rate

was

0.29%.

The

I

Class

is

subject

to

an

operating

expense

limitation

(I

Class

Limit)

pursuant

to

which

Price

Associates

is

contractually

required

to

pay

all

operating

expenses

of

the

I

Class,

excluding

management

fees;

interest;

expenses

related

to

borrowings,

taxes,

and

brokerage; non-recurring,

extraordinary expenses; and

acquired

fund

fees

and

expenses, to

the

extent

such

operating

expenses,

on

an

annualized

basis,

exceed

the

I

Class

Limit. This

agreement

will

continue

through

the

expense

limitation

date

indicated

in

the

table

below,

and

may

be

renewed,

revised,

or

revoked

only

with

approval

of

the

fund’s

Board.

The

I

Class

is

required

to

repay

Price

Associates

for

expenses

previously

paid

to

the

extent

the

class’s

net

assets

grow

or

expenses

decline

sufficiently

to

allow

repayment

without

causing

the

class’s

operating

expenses

(after

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

46

the

repayment

is

taken

into

account)

to

exceed

the

lesser

of:

(1)

the

I

Class

Limit

in

place

at

the

time

such

amounts

were

paid;

or

(2)

the

current

I

Class

Limit.

However,

no

repayment

will

be

made

more

than

three

years

after

the

date

of

a

payment

or

waiver.

Pursuant

to

these

agreements,

expenses

were

waived/paid

by

and/or

repaid

to

Price

Associates

during

the

year ended February

28,

2023

as

indicated

in

the

table

below

and

remain

subject

to

repayment

by

the

fund.

Any

repayment

of

expenses

previously

waived/

paid

by

Price

Associates

during

the

period

would

be

included

in

the

net

investment

income

and

expense

ratios

presented

on

the

accompanying

Financial

Highlights.

In

addition,

the

fund

has

entered

into

service

agreements

with

Price

Associates

and

a

wholly

owned

subsidiary

of

Price

Associates,

each

an

affiliate

of

the

fund

(collectively,

Price).

Price

Associates

provides

certain

accounting

and

administrative

services

to

the

fund.

T.

Rowe

Price

Services,

Inc.

provides

shareholder

and

administrative

services

in

its

capacity

as

the

fund’s

transfer

and

dividend-disbursing

agent.

For

the

year

ended

February

28,

2023,

expenses

incurred

pursuant

to

these

service

agreements

were

$100,000

for

Price

Associates

and

$220,000

for

T.

Rowe

Price

Services,

Inc.

All

amounts

due

to

and

due

from

Price,

exclusive

of

investment

management

fees

payable,

are

presented

net

on

the

accompanying

Statement

of

Assets

and

Liabilities.

The fund

may

invest

its

cash

reserves

in

certain

open-end

management

investment

companies

managed

by

Price

Associates

and

considered

affiliates

of

the

fund:

the

T.

Rowe

Price

Government

Reserve

Fund

or

the

T.

Rowe

Price

Treasury

Reserve

Fund,

organized

as

money

market

funds

(together,

the

Price

Reserve

Funds).

The

Price

Reserve

Funds

are

offered

as

short-term

investment

options

to

mutual

funds,

trusts,

and

other

accounts

managed

by

Price

Associates

or

its

affiliates

and

are

not

available

for

direct

purchase

by

members

of

the

public.

Cash

collateral

from

securities

lending,

if

any,

is

invested

in

the

T.

Rowe

Price

Government

Reserve Fund. The

Price

Reserve

Funds

pay

no

investment

management

fees.

The

fund may

participate

in

securities

purchase

and

sale

transactions

with

other

funds

or

accounts

advised

by

Price

Associates

(cross

trades),

in

accordance

with

procedures

adopted

by the

fund’s

Board

and

Securities

and

Exchange

Commission

rules,

which

require,

among

other

things,

that

such

purchase

and

sale

cross

trades

be

effected

at

the

I

Class

Expense

limitation/I

Class

Limit

0.05%

Expense

limitation

date

06/30/23

(Waived)/repaid

during

the

period

($000s)

$(67)

T.

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PRICE

Tax-Efficient

Equity

Fund

47

independent

current

market

price

of

the

security.

During

the

year

ended

February

28,

2023,

the

fund

had

no

purchases

or

sales

cross

trades

with

other

funds

or

accounts

advised

by

Price

Associates.

Price

Associates

has

voluntarily

agreed

to

reimburse

the

fund

from

its

own

resources

on

a

monthly

basis

for

the

cost

of

investment

research

embedded

in

the

cost

of

the

fund’s

securities

trades.

This

agreement

may

be

rescinded

at

any

time.

For

the

year ended

February

28,

2023,

this

reimbursement

amounted

to

$4,000,

which

is

included

in

Net

realized

gain

(loss)

on

Securities

in

the

Statement

of

Operations.

NOTE

7

-

OTHER

MATTERS

Unpredictable

events

such

as

environmental

or

natural

disasters,

war,

terrorism,

pandemics,

outbreaks

of

infectious

diseases,

and

similar

public

health

threats

may

significantly

affect

the

economy

and

the

markets

and

issuers

in

which

the fund

invests.

Certain

events

may

cause

instability

across

global

markets,

including

reduced

liquidity

and

disruptions

in

trading

markets,

while

some

events

may

affect

certain

geographic

regions,

countries,

sectors,

and

industries

more

significantly

than

others,

and

exacerbate

other

pre-existing

political,

social,

and

economic

risks.

Since

2020,

a

novel

strain

of

coronavirus

(COVID-19)

has

resulted

in

disruptions

to

global

business

activity

and

caused

significant

volatility

and

declines

in

global

financial

markets.

In

February

2022,

Russian

forces

entered

Ukraine

and

commenced

an

armed

conflict

leading

to

economic

sanctions

being

imposed

on

Russia

and

certain

of

its

citizens,

creating

impacts

on

Russian-related

stocks

and

debt

and

greater

volatility

in

global

markets.

These

are

recent

examples

of

global

events

which

may

have

a

negative

impact

on

the

values

of

certain

portfolio

holdings

or

the

fund’s

overall

performance.

Management

is

actively

monitoring

the

risks

and

financial

impacts

arising

from

these

events.

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

48

REPORT

OF

INDEPENDENT

REGISTERED

PUBLIC

ACCOUNTING

FIRM

To

the

Board

of

Directors

of

T.

Rowe

Price

Tax-Efficient

Funds,

Inc.

and

Shareholders

of

T.

Rowe

Price

Tax-Efficient

Equity

Fund

Opinion

on

the

Financial

Statements

We

have

audited

the

accompanying

statement

of

assets

and

liabilities,

including

the

portfolio

of

investments,

of

T.

Rowe

Price

Tax-Efficient

Equity

Fund

(constituting

T.

Rowe

Price

Tax-Efficient

Funds,

Inc.,

referred

to

hereafter

as

the

"Fund")

as

of

February

28,

2023,

the

related

statement

of

operations

for

the

year

ended

February

28,

2023,

the

statement

of

changes

in

net

assets

for

each

of

the

two

years

in

the

period

ended

February

28,

2023,

including

the

related

notes,

and

the

financial

highlights

for

each

of

the

five

years

in

the

period

ended

February

28,

2023

(collectively

referred

to

as

the

“financial

statements”).

In

our

opinion,

the

financial

statements

present

fairly,

in

all

material

respects,

the

financial

position

of

the

Fund

as

of

February

28,

2023,

the

results

of

its

operations

for

the

year

then

ended,

the

changes

in

its

net

assets

for

each

of

the

two

years

in

the

period

ended

February

28,

2023

and

the

financial

highlights

for

each

of

the

five

years

in

the

period

ended

February

28,

2023

in

conformity

with

accounting

principles

generally

accepted

in

the

United

States

of

America.

Basis

for

Opinion

These

financial

statements

are

the

responsibility

of

the

Fund’s

management.

Our

responsibility

is

to

express

an

opinion

on

the

Fund’s

financial

statements

based

on

our

audits.

We

are

a

public

accounting

firm

registered

with

the

Public

Company

Accounting

Oversight

Board

(United

States)

(PCAOB)

and

are

required

to

be

independent

with

respect

to

the

Fund

in

accordance

with

the

U.S.

federal

securities

laws

and

the

applicable

rules

and

regulations

of

the

Securities

and

Exchange

Commission

and

the

PCAOB.

We

conducted

our

audits

of

these

financial

statements

in

accordance

with

the

standards

of

the

PCAOB.

Those

standards

require

that

we

plan

and

perform

the

audit

to

obtain

reasonable

assurance

about

whether

the

financial

statements

are

free

of

material

misstatement,

whether

due

to

error

or

fraud.

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

49

Our

audits

included

performing

procedures

to

assess

the

risks

of

material

misstatement

of

the

financial

statements,

whether

due

to

error

or

fraud,

and

performing

procedures

that

respond

to

those

risks.

Such

procedures

included

examining,

on

a

test

basis,

evidence

regarding

the

amounts

and

disclosures

in

the

financial

statements.

Our

audits

also

included

evaluating

the

accounting

principles

used

and

significant

estimates

made

by

management,

as

well

as

evaluating

the

overall

presentation

of

the

financial

statements.

Our

procedures

included

confirmation

of

securities

owned

as

of

February

28,

2023

by

correspondence

with

the

custodians,

transfer

agent

and

brokers;

when

replies

were

not

received

from

brokers,

we

performed

other

auditing

procedures.

We

believe

that

our

audits

provide

a

reasonable

basis

for

our

opinion.   

PricewaterhouseCoopers

LLP

Baltimore,

Maryland

April

19,

2023

We

have

served

as

the

auditor

of

one

or

more

investment

companies

in

the

T.

Rowe

Price

group

of

investment

companies

since

1973.

REPORT

OF

INDEPENDENT

REGISTERED

PUBLIC

ACCOUNTING

FIRM

(continued)

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

50

TAX

INFORMATION

(UNAUDITED)

FOR

THE

TAX

YEAR

ENDED 2/28/23

We

are

providing

this

information

as

required

by

the

Internal

Revenue

Code.

The

amounts

shown

may

differ

from

those

elsewhere

in

this

report

because

of

differences

between

tax

and

financial

reporting

requirements.

The

fund’s

distributions

to

shareholders

included

$5,879,000 from

long-term

capital

gains,

subject

to

a

long-term

capital

gains

tax

rate

of

not

greater

than

20%.

For

taxable

non-corporate

shareholders,

$5,648,000 of

the

fund's

income

represents

qualified

dividend

income

subject

to

a

long-term

capital

gains

tax

rate

of

not

greater

than

20%.

For

corporate

shareholders,

$5,232,000

of

the

fund's

income

qualifies

for

the

dividends-

received

deduction.  

INFORMATION

ON

PROXY

VOTING

POLICIES,

PROCEDURES,

AND

RECORDS

A

description

of

the

policies

and

procedures

used

by

T.

Rowe

Price

funds

to

determine

how

to

vote

proxies

relating

to

portfolio

securities

is

available

in

each

fund’s

Statement

of

Additional

Information.

You

may

request

this

document

by

calling

1-800-225-5132

or

by

accessing

the

SEC’s

website,

sec.gov.

The

description

of

our

proxy

voting

policies

and

procedures

is

also

available

on

our

corporate

website.

To

access

it,

please

visit

the

following

Web

page:

https://www.troweprice.com/corporate/us/en/utility/policies.html

Scroll

down

to

the

section

near

the

bottom

of

the

page

that

says,

“Proxy

Voting

Guidelines.”

Click

on

the

links

in

the

shaded

box.

Each

fund’s

most

recent

annual

proxy

voting

record

is

available

on

our

website

and

through

the

SEC’s

website.

To

access

it

through

T.

Rowe

Price,

visit

the

website

location

shown

above,

and

scroll

down

to

the

section

near

the

bottom

of

the

page

that

says,

“Proxy

Voting

Records.”

Click

on

the

Proxy

Voting

Records

link

in

the

shaded

box.

HOW

TO

OBTAIN

QUARTERLY

PORTFOLIO

HOLDINGS

The

fund

files

a

complete

schedule

of

portfolio

holdings

with

the

Securities

and

Exchange

Commission

(SEC)

for

the

first

and

third

quarters

of

each

fiscal

year

as

an

exhibit

to

its

reports

on

Form

N-PORT.

The

fund’s

reports

on

Form

N-PORT

are

available

electronically

on

the

SEC’s

website

(sec.gov).

In

addition,

most

T.

Rowe

Price

funds

disclose

their

first

and

third

fiscal

quarter-end

holdings

on

troweprice.com

.

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

51

ABOUT

THE

FUND'S

DIRECTORS

AND

OFFICERS

Your

fund

is

overseen

by

a

Board

of

Directors

(Board)

that

meets

regularly

to

review

a

wide

variety

of

matters

affecting

or

potentially

affecting

the

fund,

including

performance,

investment

programs,

compliance

matters,

advisory

fees

and

expenses,

service

providers,

and

business

and

regulatory

affairs.

The

Board

elects

the

fund’s

officers,

who

are

listed

in

the

final

table.

The

directors

who

are

also

employees

or

officers

of

T.

Rowe

Price

are

considered

to

be

“interested”

directors

as

defined

in

Section

2(a)(19)

of

the

1940

Act

because

of

their

relationships

with

T.

Rowe

Price

Associates,

Inc. (T.

Rowe

Price),

and

its

affiliates.

The

business

address

of

each

director

and

officer

is

100

East

Pratt

Street,

Baltimore,

Maryland

21202.

The

Statement

of

Additional

Information

includes

additional

information

about

the

fund

directors

and

is

available

without

charge

by

calling

a

T.

Rowe

Price

representative

at

1-800-638-5660.

INDEPENDENT

DIRECTORS

(a)

Name

(Year

of

Birth)

Year

Elected

[Number

of

T.

Rowe

Price

Portfolios

Overseen]

Principal

Occupation(s)

and

Directorships

of

Public

Companies

and

Other

Investment

Companies

During

the

Past

Five

Years

Teresa

Bryce

Bazemore

(1959)

2018

[205]

President

and

Chief

Executive

Officer,

Federal

Home

Loan

Bank

of

San

Francisco

(2021

to

present);

Chief

Executive

Officer,

Bazemore

Consulting

LLC

(2018

to

2021);

Director,

Chimera

Investment

Corporation

(2017

to

2021);

Director,

First

Industrial

Realty

Trust

(2020

to

present);

Director,

Federal

Home

Loan

Bank

of

Pittsburgh

(2017

to

2019)

Bruce

W.

Duncan

(1951)

2013

[205]

President,

Chief

Executive

Officer,

and

Director,

CyrusOne,

Inc.

(2020

to

2021);

Chair

of

the

Board

(2016

to

2020)

and

President

(2009

to

2016),

First

Industrial

Realty

Trust,

owner

and

operator

of

industrial

properties;

Member,

Investment

Company

Institute

Board

of

Governors

(2017

to

2019);

Member,

Independent

Directors

Council

Governing

Board

(2017

to

2019);

Senior

Advisor,

KKR

(2018

to

2022);

Director,

Boston

Properties

(2016

to

present);

Director,

Marriott

International,

Inc.

(2016

to

2020)

Robert

J.

Gerrard,

Jr.

(1952)

2012

[205]

Chair

of

the

Board,

all

funds

(July

2018

to

present)

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

52

INTERESTED  DIRECTORS

(a)

Name

(Year

of

Birth)

Year

Elected

[Number

of

T.

Rowe

Price

Portfolios

Overseen]

Principal

Occupation(s)

and

Directorships

of

Public

Companies

and

Other

Investment

Companies

During

the

Past

Five

Years

Paul

F.

McBride

(1956)

2013

[205]

Advisory

Board

Member,

Vizzia

Technologies

(2015

to

present);

Board

Member,

Dunbar

Armored

(2012

to

2018)

Kellye

L.

Walker

(1966)

2021

[205]

Executive

Vice

President

and

Chief

Legal

Officer,

Eastman

Chemical

Company

(April

2020

to

present);

Executive

Vice

President

and

Chief

Legal

Officer,

Huntington

Ingalls

Industries,

Inc.

(January

2015

to

March

2020);

Director,

Lincoln

Electric

Company

(October

2020

to

present)

(a)

All

information

about

the

independent

directors

was

current

as

of

December

31,

2022,

unless

otherwise

indicated,

except

for

the

number

of

portfolios

overseen,

which

is

current

as

of

the

date

of

this

report.

Name

(Year

of

Birth)

Year

Elected

[Number

of

T.

Rowe

Price

Portfolios

Overseen]

Principal

Occupation(s)

and

Directorships

of

Public

Companies

and

Other

Investment

Companies

During

the

Past

Five

Years

David

Oestreicher

(1967)

2018

[205]

Director,

Vice

President,

and

Secretary,

T.

Rowe

Price,

T.

Rowe

Price

Investment

Services,

Inc.,

T.

Rowe

Price

Retirement

Plan

Services,

Inc.,

and

T.

Rowe

Price

Services,

Inc.;

Director

and

Secretary,

T.

Rowe

Price

Investment

Management,

Inc.

(Price

Investment

Management);

Vice

President

and

Secretary,

T.

Rowe

Price

International

(Price

International);

Vice

President,

T.

Rowe

Price

Hong

Kong

(Price

Hong

Kong),

T. Rowe

Price

Japan

(Price

Japan),

and

T.

Rowe

Price

Singapore

(Price

Singapore);

General

Counsel,

Vice

President,

and

Secretary,

T.

Rowe

Price

Group,

Inc.;

Chair

of

the

Board,

Chief

Executive

Officer,

President,

and

Secretary,

T.

Rowe

Price

Trust

Company;

Principal

Executive

Officer

and

Executive

Vice

President,

all

funds

Eric

L.

Veiel,

CFA

(1972)

2022

[205]

Director

and

Vice

President,

T.

Rowe

Price;

Vice

President,

T.

Rowe

Price

Group,

Inc.,

and

T.

Rowe

Price

Trust

Company;

Vice

President,

Global

Funds

(a)

All

information

about

the

interested

directors

was

current

as

of

December

31,

2022,

unless

otherwise

indicated,

except

for

the

number

of

portfolios

overseen,

which

is

current

as

of

the

date

of

this

report.

INDEPENDENT

DIRECTORS

(a)

(CONTINUED)

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

53

OFFICERS

Name

(Year

of

Birth)

Position

Held

with Tax-Efficient

Funds 

Principal

Occupation(s) 

Kennard

W.

Allen

(1977)

Vice

President

Vice

President,

T.

Rowe

Price

and

T.

Rowe

Price

Group,

Inc.

Ziad

Bakri,

M.D.,

CFA

(1980)

Vice

President

Vice

President,

T.

Rowe

Price

and

T.

Rowe

Price

Group,

Inc.

Armando

(Dino)

Capasso

(1974)

Chief

Compliance

Officer

Chief

Compliance

Officer

and

Vice

President,

T.

Rowe

Price

and

Price

Investment

Management;

Vice

President,

T.

Rowe

Price

Group,

Inc.;

formerly,

Chief

Compliance

Officer,

PGIM

Investments

LLC

and

AST

Investment

Services,

Inc.

(ASTIS)

(to

2022);

Chief

Compliance

Officer,

PGIM

Retail

Funds

complex

and

Prudential

Insurance

Funds

(to

2022);

Vice

President

and

Deputy

Chief

Compliance

Officer,

PGIM

Investments

LLC

and

ASTIS

(to

2019);

Senior

Vice

President

and

Senior

Counsel

of

Pacific

Investment

Management

Company

LLC

(to

2017)

Gregory

Dunham,

CFA

(1974)

Vice

President

Vice

President,

T.

Rowe

Price

and

T.

Rowe

Price

Group,

Inc.

Alan

S.

Dupski,

CPA

(1982)

Principal

Financial

Officer,

Vice

President,

and

Treasurer

Vice

President,

Price

Investment

Management,

T.

Rowe

Price,

T.

Rowe

Price

Group,

Inc.,

and

T.

Rowe

Price

Trust

Company

Gary

J.

Greb

(1961)

Vice

President

Vice

President,

Price

Investment

Management,

T.

Rowe

Price,

Price

International,

and

T.

Rowe

Price

Trust

Company

Cheryl

Hampton,

CPA

(1969)

Vice

President

Vice

President,

T.

Rowe

Price;

formerly,

Tax

Director,

Invesco

Ltd.

(to

2021);

Vice

President,

Oppenheimer

Funds,

Inc.

(to

2019)

Kate

Hobbs

(1982)

Vice

President

Vice

President,

T.

Rowe

Price

and

T.

Rowe

Price

Group,

Inc.;

formerly,

Portfolio

Manager,

Millennium

Partners

(to

2020);

Senior

Analyst,

Citadel

LLC,

Aptigon

Capital

(to

2018)

Benjamin

Kersse,

CPA

(1989)

Vice

President

Vice

President,

T.

Rowe

Price

Paul

J.

Krug,

CPA

(1964)

Vice

President

Vice

President,

T.

Rowe

Price,

T.

Rowe

Price

Group,

Inc.,

and

T.

Rowe

Price

Trust

Company

Donald

J.

Peters

(1959)

President

Vice

President,

T.

Rowe

Price

and

T.

Rowe

Price

Group,

Inc.

Fran

M.

Pollack-Matz

(1961)

Vice

President

and

Secretary 

Vice

President,

T.

Rowe

Price,

T.

Rowe

Price

Group,

Inc.,

T.

Rowe

Price

Investment

Services,

Inc.,

and

T.

Rowe

Price

Services,

Inc.

Unless

otherwise

noted,

officers

have

been

employees

of

T.

Rowe

Price

or

Price

International

for

at

least

5

years.

T.

ROWE

PRICE

Tax-Efficient

Equity

Fund

54

Name

(Year

of

Birth)

Position

Held

with Tax-Efficient

Funds 

Principal

Occupation(s) 

Shannon

H.

Rauser

(1987)

Assistant

Secretary 

Assistant

Vice

President,

T.

Rowe

Price

Richard

Sennett,

CPA

(1970)

Assistant

Treasurer

Vice

President,

T.

Rowe

Price,

T.

Rowe

Price

Group,

Inc.,

and

T.

Rowe

Price

Trust

Company

Weijie

(Vivian)

Si

(1983)

Vice

President

Vice

President,

T.

Rowe

Price

and

T.

Rowe

Price

Group,

Inc.

Matthew

J.

Snowling,

CFA

(1971)

Vice

President

Vice

President,

T.

Rowe

Price

and

T.

Rowe

Price

Group,

Inc.

James

Stillwagon

(1982)

Vice

President

Vice

President,

T.

Rowe

Price

and

T.

Rowe

Price

Group,

Inc.

Alan

Tu

(1985)

Vice

President

Vice

President,

T.

Rowe

Price

and

T.

Rowe

Price

Group,

Inc.

Anthony

Bruce Wang 

(1989)

Vice

President

Vice

President,

T.

Rowe

Price

and

T.

Rowe

Price

Group,

Inc.

Megan

Warren

(1968)

Vice

President

OFAC

Sanctions

Compliance

Officer

and

Vice

President,

Price

Investment

Management;

Vice

President,

T.

Rowe

Price,

T.

Rowe

Price

Group,

Inc.,

T.

Rowe

Price

Retirement

Plan

Services,

Inc.,

T.

Rowe

Price

Services,

Inc.,

and

T.

Rowe

Price

Trust

Company

Mark

R.

Weigman,

CFA,

CIC 

(1962)

Vice

President

Vice

President,

T.

Rowe

Price,

T.

Rowe

Price

Group,

Inc.,

and

T.

Rowe

Price

Trust

Company

Unless

otherwise

noted,

officers

have

been

employees

of

T.

Rowe

Price

or

Price

International

for

at

least

5

years.

OFFICERS

(CONTINUED)

100

East

Pratt

Street

Baltimore,

MD

21202

T.

Rowe

Price

Investment

Services,

Inc.

Call

1-800-225-5132

to

request

a

prospectus

or

summary

prospectus;

each

includes

investment

objectives,

risks,

fees,

expenses,

and

other

information

that

you

should

read

and

consider

carefully

before

investing.

202304-2689336

F136-050

4/23

Item 1. (b) Notice pursuant to Rule 30e-3.

Not applicable.

Item 2. Code of Ethics.

The registrant has adopted a code of ethics, as defined in Item 2 of Form N-CSR, applicable to its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. A copy of this code of ethics is filed as an exhibit to this Form N-CSR. No substantive amendments were approved or waivers were granted to this code of ethics during the period covered by this report.

Item 3. Audit Committee Financial Expert.

The registrant’s Board of Directors has determined that Ms. Teresa Bryce Bazemore qualifies as an audit committee financial expert, as defined in Item 3 of Form N-CSR. Ms. Bazemore is considered independent for purposes of Item 3 of Form N-CSR.

Item 4. Principal Accountant Fees and Services.

(a) – (d)    Aggregate fees billed for the last two fiscal years for professional services rendered to, or on behalf of, the registrant by the registrant’s principal accountant were as follows:

	2023		2022
Audit Fees	$	21,409	$	21,462
Audit-Related Fees		-		-
Tax Fees		-		818
All Other Fees		-		-

Audit fees include amounts related to the audit of the registrant’s annual financial statements and services normally provided by the accountant in connection with statutory and regulatory filings. Audit-related fees include amounts reasonably related to the performance of the audit of the registrant’s financial statements and specifically include the issuance of a report on internal controls and, if applicable, agreed-upon procedures related to fund acquisitions. Tax fees include amounts related to services for tax compliance, tax planning, and tax advice. The nature of these services specifically includes the review of distribution calculations and the preparation of Federal, state, and excise tax returns. All other fees include the registrant’s pro-rata share of amounts for agreed-upon procedures in conjunction with service contract approvals by the registrant’s Board of Directors/Trustees.

(e)(1) The registrant’s audit committee has adopted a policy whereby audit and non-audit services performed by the registrant’s principal accountant for the registrant, its investment adviser, and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant require pre-approval in advance at regularly scheduled audit committee meetings. If such a service is required between regularly scheduled audit committee meetings, pre-approval may be authorized by one audit committee member with ratification at the next scheduled audit committee meeting. Waiver of pre-approval for audit or non-audit services requiring fees of a de minimis amount is not permitted.

    (2) No services included in (b) – (d) above were approved pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.

(f) Less than 50 percent of the hours expended on the principal accountant’s engagement to audit the registrant’s financial statements for the most recent fiscal year were attributed to work performed by persons other than the principal accountant’s full-time, permanent employees.

(g) The aggregate fees billed for the most recent fiscal year and the preceding fiscal year by the registrant’s principal accountant for non-audit services rendered to the registrant, its investment adviser, and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant were $1,454,000 and $3,749,000, respectively.

(h) All non-audit services rendered in (g) above were pre-approved by the registrant’s audit committee. Accordingly, these services were considered by the registrant’s audit committee in maintaining the principal accountant’s independence.

Item 5. Audit Committee of Listed Registrants.

Not applicable.

Item 6. Investments.

(a) Not applicable. The complete schedule of investments is included in Item 1 of this Form N-CSR.

(b) Not applicable.

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.

Not applicable.

Item 8. Portfolio Managers of Closed-End Management Investment Companies.

Not applicable.

Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.

Not applicable.

Item 10. Submission of Matters to a Vote of Security Holders.

There has been no change to the procedures by which shareholders may recommend nominees to the registrant’s board of directors.

Item 11. Controls and Procedures.

(a) The registrant’s principal executive officer and principal financial officer have evaluated the registrant’s disclosure controls and procedures within 90 days of this filing and have concluded that the registrant’s disclosure controls and procedures were effective, as of that date, in ensuring that information required to be disclosed by the registrant in this Form N-CSR was recorded, processed, summarized, and reported timely.

(b) The registrant’s principal executive officer and principal financial officer are aware of no change in the registrant’s internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.

Not applicable.

Item 13. Exhibits.

(a)(1)	The registrant’s code of ethics pursuant to Item 2 of Form N-CSR is attached.
(2)	Separate certifications by the registrant’s principal executive officer and principal financial officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 and required by Rule 30a-2(a) under the Investment Company Act of 1940, are attached.
(3)	Written solicitation to repurchase securities issued by closed-end companies: not applicable.
(b)	A certification by the registrant’s principal executive officer and principal financial officer, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and required by Rule 30a-2(b) under the Investment Company Act of 1940, is attached.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

T. Rowe Price Tax-Efficient Funds, Inc.

By	/s/ David Oestreicher
	David Oestreicher
	Principal Executive Officer
Date	April 19, 2023

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By	/s/ David Oestreicher
	David Oestreicher
	Principal Executive Officer
Date	April 19, 2023

By	/s/ Alan S. Dupski
	Alan S. Dupski
	Principal Financial Officer
Date	April 19, 2023