I

103D CONGRESS

2D SESSION H. R. 5091

To provide for tax relief in the case of low economic growth.

IN THE HOUSE OF REPRESENTATIVES

SEPTEMBER 23, 1994

Mr. OBEY (for himself, Mr. FILNER, Mr. BONIOR, Mr. HAMILTON, Mr.

HINCHEY, Mrs. MEEK, Mr. RUSH, Mr. RICHARDSON, Mr. CLAY, Mr.

BRYANT, Mr. VENTO, Mr. SERRANO, Mr. ANDREWS of Maine, Mr. WILSON, and Ms. PELOSI) introduced the following bill; which was referred

to the Committee on Ways and Means

A BILL

To provide for tax relief in the case of low economic growth.

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

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Economic Growth and

5 Jobs Act of 1994’’.

6 SEC. 2. TAX RELIEF IN THE EVENT OF LOW GROWTH.

7 (a) LOW-GROWTH REPORT.—

8 (1) IN GENERAL.—At any time, the Director of

9 the Office of Management and Budget (hereafter in

10 this section referred to as the ‘‘Director’’) shall no-
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1 tify the President and the Congress if the Director

2 has determined that for any of the periods described

3 in paragraph (2)—

4 (A) economic growth as measured by the

5 change in real Gross Domestic Product (GDP)

6 at an annual rate is estimated to be less than

7 3 percent, and

8 (B) the rate of national unemployment

9 (seasonally adjusted) is estimated to be greater

10 than 6.0 percent.

11 (2) TESTING PERIODS.—For purposes of para12 graph (1), the periods described in this paragraph

13 are—

14 (A) the period consisting of the quarter

15 during which the notification is given and the

16 quarter preceding such notification,

17 (B) the period consisting of the preceding

18 4 quarters, and

19 (C) the period consisting of the 4 quarters

20 following such notification.

21 (b) PRESIDENTIAL AUTHORIZATION OF TEMPORARY

22 TAX REDUCTIONS.—

23 (1) PRESIDENTIAL DECLARATION.—After noti24 fication under subsection (a), the President may

25 issue a declaration that temporary income tax reduc-
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1 tions are required for a specified calendar year to

2 provide a quick and necessary fiscal stimulus to the

3 economy. Any such declaration shall be transmitted

4 to the Congress.

5 (2) TEMPORARY TAX MODIFICATIONS.—If the

6 President transmits a declaration under paragraph

7 (1) to the Congress—

8 (A) TEMPORARY TAX REDUCTIONS.—

9 (i) IN GENERAL.—Effective for tax10 able years beginning in the calendar year

11 specified in such declaration—

12 (I) the rates applicable to the

13 first income bracket in the tax tables

14 contained in section 1 of the Internal

15 Revenue Code of 1986 shall be re16 duced by a percentage (not to exceed

131 17 ⁄3 percent) specified in such dec18 laration, and

19 (II) the amounts set forth as tax

20 in such tables shall be adjusted to re21 flect such rate reduction.

22 (ii) WITHHOLDING ADJUSTMENTS.—

23 The withholding tables or procedures pre24 scribed by the Secretary of the Treasury or

25 his delegate under section 3402(a) of such
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1 Code shall be modified so that, to the max2 imum extent possible, the full calendar

3 year effect of such reduction is reflected

4 through withholding reductions during the

5 portion of the calendar year after such dec6 laration.

7 (B) TEMPORARY SURTAX WHERE ECO8 NOMIC GROWTH REQUIREMENTS SUBSE9 QUENTLY SATISFIED.—

10 (i) IN GENERAL.—Effective for tax11 able years beginning in the first subse12 quent calendar year for which the eco13 nomic growth requirements of paragraph

14 (3) are satisfied—

15 (I) each rate of tax in the tax ta16 bles contained in section 1 of the In17 ternal Revenue Code of 1986 shall be

18 increased by the percentage deter19 mined under paragraph (4) for such

20 year, and

21 (II) the amounts set forth as tax

22 in such tables shall be adjusted to re23 flect such rate increases.

24 (ii) WITHHOLDING ADJUSTMENTS.—

25 Effective for such subsequent calendar
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1 year, the withholding tables or procedures

2 prescribed by the Secretary of the Treas3 ury or his delegate under section 3402(a)

4 of such Code shall be modified to reflect

5 the increase in tax rates under clause (i).

6 (3) ECONOMIC GROWTH REQUIREMENTS.—The

7 economic growth requirements of this paragraph are

8 satisfied for any calendar year if, before the begin9 ning of such calendar year, the President determines

10 (and publishes such determination in the Federal

11 Register) that for such calendar year and the imme12 diately preceding calendar year—

13 (A) economic growth as measured by the

14 change in the real Gross Domestic Product

15 (GDP) is estimated to be greater than 4 per16 cent, and

17 (B) the rate of national unemployment

18 (seasonally adjusted) is estimated to be less

19 than 6.0 percent.

20 (4) RATE INCREASE PERCENTAGE.—The per21 centage determined under this paragraph is the per22 centage increase in the tax rates contained in section

23 1 of the Internal Revenue Code of 1986 which the

24 President estimates will result in an aggregate in25 crease in receipts under chapter 1 of such Code
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1 equal to the aggregate decrease in receipts under

2 such Code by reason of subparagraph (A) of para3 graph (2). Such percentage shall be published in the

4 Federal Register before the beginning of the cal5 endar year for which the economic growth require6 ments of paragraph (2) are satisfied.

7 (5) SPECIAL RULES WHERE MORE THAN 1 RATE

8 REDUCTION.—If there has been more than 1 reduc9 tion under paragraph (2)(A) before any increase

10 under paragraph (2)(B)—

11 (A) paragraph (2)(B) shall not be limited

12 to the first subsequent calendar year for which

13 the economic growth requirements of paragraph

14 (3) are satisfied, but

15 (B) the percentage determined under para16 graph (4) for each such subsequent calendar

17 year shall be determined by taking into account

18 only the decrease in receipts under such Code

19 with respect to taxable years beginning in a sin20 gle calendar year, beginning with the earliest

21 calendar year with respect to which a percent22 age increase has not been determined under

23 paragraph (4).
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1 SEC. 3. TREATMENT UNDER PAY-AS-YOU-GO PROCEDURES.

2 Any reduction or increase in receipts resulting from

3 section 2 of this Act shall not be considered for any pur4 pose under the Balanced Budget and Emergency Deficit

5 Control Act of 1985.

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