To amend the Congressional Budget Act of 1974 to provide for macroeconomic analysis of the impact of legislation.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Pro-Growth Budgeting Act of 2012''.

SEC. 2. MACROECONOMIC IMPACT ANALYSES.

    (a) In General.--Part A of title IV of the Congressional Budget Act 
of 1974 is amended by adding at the end the following new section:

          ``macroeconomic impact analysis of major legislation

    ``Sec. 407.  (a) Congressional Budget Office.--The Congressional 
Budget Office shall, to the extent practicable, prepare for each major 
bill or resolution reported by any committee of the House of 
Representatives or the Senate (except the Committee on Appropriations 
of each House), as a supplement to estimates prepared under section 
402, a macroeconomic impact analysis of the budgetary effects of such 
bill or resolution for the ten fiscal-year period beginning with the 
first fiscal year for which an estimate was prepared under section 402 
and each of the next three ten fiscal-year periods. Such estimate shall 
be predicated upon the supplemental projection described in section 
202(e)(4). The Director shall submit to such committee the 
macroeconomic impact analysis, together with the basis for the 
analysis. As a supplement to estimates prepared under section 402, all 
such information so submitted shall be included in the report 
accompanying such bill or resolution.
    ``(b) Economic Impact.--The analysis prepared under subsection (a) 
shall describe the potential economic impact of the applicable major 
bill or resolution on major economic variables, including real gross 
domestic product, business investment, the capital stock, employment, 
interest rates, and labor supply. The analysis shall also describe the 
potential fiscal effects of the bill or resolution, including any 
estimates of revenue increases or decreases resulting from changes in 
gross domestic product. To the extent practicable, the analysis should 
use a variety of economic models in order to reflect the full range of 
possible economic outcomes resulting from the bill or resolution. The 
analysis (or a technical appendix to the analysis) shall specify the 
economic and econometric models used, sources of data, relevant data 
transformations, and shall include such explanation as is necessary to 
make the models comprehensible to academic and public policy analysts.
    ``(c) Definitions.--As used in this section--
            ``(1) the term `macroeconomic impact analysis' means--
                    ``(A) an estimate of the changes in economic 
                output, employment, interest rates, capital stock, and 
                tax revenues expected to result from enactment of the 
                proposal;
                    ``(B) an estimate of revenue feedback expected to 
                result from enactment of the proposal; and
                    ``(C) a statement identifying the critical 
                assumptions and the source of data underlying that 
                estimate;
            ``(2) the term `major bill or resolution' means any bill or 
        resolution if the gross budgetary effects of such bill or 
        resolution for any fiscal year in the period for which an 
        estimate is prepared under section 402 is estimated to be 
        greater than .25 percent of the current projected gross 
        domestic product of the United States for any such fiscal year;
            ``(3) the term `budgetary effect', when applied to a major 
        bill or resolution, means the changes in revenues, outlays, 
        deficits, and debt resulting from that measure; and
            ``(4) the term `revenue feedback' means changes in revenue 
        resulting from changes in economic growth as the result of the 
        enactment of any major bill or resolution.''.
    (b) Conforming Amendment.--The table of contents set forth in 
section 1(b) of the Congressional Budget Act of 1974 is amended by 
inserting after the item relating to section 406 the following new 
item:

``Sec. 407. Macroeconomic impact analysis of major legislation.''.

SEC. 3. ADDITIONAL CBO REPORT TO BUDGET COMMITTEES.

    Section 202(e) of the Congressional Budget Act of 1974 is amended 
by adding at the end the following new paragraphs:
            ``(4)(A) After the President's budget submission under 
        section 1105(a) of title 31, United States Code, in addition to 
        the baseline projections, the Director shall submit to the 
        Committees on the Budget of the House of Representatives and 
        the Senate a supplemental projection assuming extension of 
        current tax policy for the fiscal year commencing on October 1 
        of that year with a supplemental projection for the 10 fiscal-
        year period beginning with that fiscal year, assuming the 
        extension of current tax policy.
            ``(B) For the purposes of this paragraph, the term `current 
        tax policy' means the tax policy in statute as of December 31 
        of the current year assuming--
                    ``(i) the budgetary effects of measures extending 
                the Economic Growth and Tax Relief Reconciliation Act 
                of 2001;
                    ``(ii) the budgetary effects of measures extending 
                the Jobs and Growth Tax Relief Reconciliation Act of 
                2003;
                    ``(iii) the continued application of the 
                alternative minimum tax as in effect for taxable years 
                beginning in 2011 pursuant to title II of the Tax 
                Relief, Unemployment Insurance Reauthorization, and Job 
                Creation Act of 2010, assuming that for taxable years 
                beginning after 2011 the exemption amount shall equal--
                            ``(I) the exemption amount for taxable 
                        years beginning in 2011, as indexed for 
                        inflation; or
                            ``(II) if a subsequent law modifies the 
                        exemption amount for later taxable years, the 
                        modified exemption amount, as indexed for 
                        inflation; and
                    ``(iv) the budgetary effects of extending the 
                estate, gift, and generation-skipping transfer tax 
                provisions of title III of the Tax Relief, Unemployment 
                Insurance Reauthorization, and Job Creation Act of 
                2010.
            ``(5) On or before July 1 of each year, the Director shall 
        submit to the Committees on the Budget of the House of 
        Representatives and the Senate, the Long-Term Budget Outlook 
        for the fiscal year commencing on October 1 of that year and at 
        least the ensuing 40 fiscal years.''.

            Passed the House of Representatives February 2, 2012.

            Attest:

                                                 KAREN L. HAAS,

                                                                 Clerk.

Summary: Pro-Growth Budgeting Act of 2012 - Amends the Congressional Budget Act of 1974 (CBA) to require the Congressional Budget Office (CBO) to prepare for each major bill or resolution reported by any congressional committee , as a supplement to CBO cost estimates, a macroeconomic impact analysis of the budgetary effects of such legislation for the 10-fiscal year period beginning with the first fiscal year for which such estimate was prepared and each of the next three 10-fiscal year periods. Defines major bill or resolution as any bill or resolution whose budgetary effects, for any fiscal year in the period for which a CBO cost estimate is prepared, is estimated to be greater than .25 of the current projected US gross domestic product (GDP) for that fiscal year. Requires the analysis to describe: (1) the potential economic impact of the bill or resolution on major economic variables, including real GDP, business investment, the capital stock, employment, interest rates, and labor supply. And (2) the potential fiscal effects of the measure, including any estimates of revenue increases or decreases resulting from changes in GDP. Requires the analysis to specify the economic and econometric models used, sources of data, relevant data transformations, as well as any explanation necessary to make the models comprehensible to academic and public policy analysts. Amends CBA to require the CBO Director, after the President's budget submission and in addition to the baseline projections, to report a supplemental projection to the congressional budget committees, assuming extension of current tax policy for the fiscal year commencing on October 1 of that year, with a supplemental projection for the 10-fiscal year period beginning with that fiscal year, again assuming the extension of current tax policy. Defines current tax policy as the tax policy in statute as of December 31 of the current year, assuming: (1) the budgetary effects of measures extending the Economic Growth and Tax Relief Reconciliation Act of 2001 and the Jobs and Growth Tax Relief Reconciliation Act of 2003. (2) the continued application of the alternative minimum tax (AMT) as in effect for taxable years beginning in 2011, with a specified assumption for taxable years beginning after 2011. And (3) the budgetary effects of extending the estate, gift, and generation-skipping transfer tax provisions of title III of the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010. Requires CBO to report to such committees, on or before July 1 of each year, the Long-Term Budget Outlook for: (1) the fiscal year commencing on October 1 of that year, and (2) at least the ensuing 40 fiscal years.