I 

110TH CONGRESS 

1ST SESSION H. R. 1789 

To require the Congressional Budget Office and the Joint Committee on 

Taxation to use dynamic economic modeling in addition to static economic modeling in the preparation of budgetary estimates of proposed 

changes in Federal revenue law. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 29, 2007 

Mr. FLAKE (for himself, Mr. ADERHOLT, Mr. AKIN, Mr. BARTLETT of Maryland, Mr. BISHOP of Utah, Mrs. BLACKBURN, Mr. CAMPBELL of California, Mr. CHABOT, Mr. CONAWAY, Mrs. CUBIN, Mr. CULBERSON, Mr. 

DREIER, Mr. ENGLISH of Pennsylvania, Mr. FEENEY, Mr. 

FORTENBERRY, Mr. FORTUN ̃O, Mr. FOSSELLA, Mr. FRANKS of Arizona, 

Mr. GARRETT of New Jersey, Mr. GINGREY, Mr. HENSARLING, Mr. INGLIS of South Carolina, Mr. ISSA, Mr. KIRK, Mr. MACK, Mr. MARCHANT, 

Mr. MCHENRY, Mr. MILLER of Florida, Mr. TIM MURPHY of Pennsylvania, Mrs. MUSGRAVE, Mrs. MYRICK, Mr. NEUGEBAUER, Mr. PEARCE, 

Mr. PENCE, Mr. PITTS, Mr. PRICE of Georgia, Mr. PUTNAM, Mr. 

RADANOVICH, Mr. SALI, Mr. SENSENBRENNER, Mr. SESSIONS, Mr. 

SHADEGG, Mr. SOUDER, Mr. TIAHRT, Mr. WALBERG, and Mr. WELDON

of Florida) introduced the following bill; which was referred to the Committee on the Budget, and in addition to the Committees on Rules and 

Ways and Means, for a period to be subsequently determined by the 

Speaker, in each case for consideration of such provisions as fall within 

the jurisdiction of the committee concerned 

A BILL 

To require the Congressional Budget Office and the Joint 

Committee on Taxation to use dynamic economic modeling in addition to static economic modeling in the preparation of budgetary estimates of proposed changes in 

Federal revenue law. 

mstockstill on PROD1PC66 with BILLS

2 

•HR 1789 IH

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

3 SECTION 1. SENSE OF CONGRESS. 

4 It is the sense of Congress that it is necessary to en5 sure that Congress is presented with reliable information 

6 from the Congressional Budget Office and the Joint Com7 mittee on Taxation as to the dynamic macroeconomic feed8 back effects to changes in Federal law and the probable 

9 behavioral responses of taxpayers, businesses, and other 

10 parties to such changes. Specifically, the Congress intends 

11 that, while not excluding any other estimating method, dy12 namic estimating techniques shall also be used in esti13 mating the fiscal impact of proposals to change Federal 

14 laws, to the extent that data are available to permit esti15 mates to be made in such a manner. 

16 SEC. 2. ESTIMATES OF THE JOINT COMMITTEE ON TAX17 ATION. 

18 In addition to any other estimates it may prepare of 

19 any proposed change in Federal revenue law, a fiscal esti20 mate shall be prepared by the Joint Committee on Tax21 ation of each such proposed change on the basis of as22 sumptions that estimate the probable behavioral responses 

23 of personal and business taxpayers and other relevant en24 tities to that proposed change and the dynamic macro25 economic feedback effects of that proposed change. The 

mstockstill on PROD1PC66 with BILLS

3 

•HR 1789 IH

1 preceding sentence shall apply only to a proposed change 

2 that the Joint Committee on Taxation determines, pursu3 ant to a static fiscal estimate, has a fiscal impact in excess 

4 of $250,000,000 in any fiscal year. 

5 SEC. 3. ESTIMATES OF THE CONGRESSIONAL BUDGET OF6 FICE. 

7 In addition to any other estimates it may prepare of 

8 any proposed change in Federal revenue law, a fiscal esti9 mate shall be prepared by the Congressional Budget Office 

10 of each such proposed change on the basis of assumptions 

11 that estimate the probable behavioral responses of per12 sonal and business taxpayers and other relevant entities 

13 to that proposed change and the dynamic macroeconomic 

14 feedback effects of that proposed change. The preceding 

15 sentence shall apply only to a proposed change that the 

16 Congressional Budget Office determines, pursuant to a 

17 static fiscal estimate, has a fiscal impact in excess of 

18 $250,000,000 in any fiscal year. 

19 SEC. 4. DISCLOSURE OF ASSUMPTIONS. 

20 Any report to Congress or the public made by the 

21 Joint Committee on Taxation or the Congressional Budget 

22 Office that contains an estimate made under this Act of 

23 the effect that any legislation will have on revenues shall 

24 be accompanied by— 

mstockstill on PROD1PC66 with BILLS

4 

•HR 1789 IH

1 (1) a written statement fully disclosing the eco2 nomic, technical, and behavioral assumptions that 

3 were made in producing that estimate, and 

4 (2) the static fiscal estimate made with respect 

5 to the same legislation and a written statement of 

6 the economic, technical, and behavioral assumptions 

7 that were made in producing that estimate. 

8 SEC. 5. CONTRACTING AUTHORITY. 

9 In performing the tasks specified in this Act, the 

10 Joint Committee on Taxation and the Congressional 

11 Budget Office may, subject to the availability of appro12 priations, enter into contracts with universities or other 

13 private or public organizations to perform such esti14 mations or to develop protocols and models for making 

15 such estimates. 

Æ 

mstockstill on PROD1PC66 with BILLS