Opening Statement of the Hon. William Coyne, a Representative in Congress from the State of Pennsylvania

Hearing on the Modeling the Economic Effect of Changes in Tax Policy

May 7, 2002

Thank you, Mr. Chairman, for holding these hearings. Revenue estimates are prepared by the Joint Committee on Taxation for tax bills approved by the Committee on Ways and Means. These revenue estimates measure the anticipated changes in Federal receipts that result from proposed legislative changes to the Internal Revenue Code. This information is very important to our development of tax policy.

It has been suggested that, in making revenue estimates, the JCT should take into account the projected macroeconomic effects that would result from a particular tax proposal.

As we explore this issue today, I think we will find that "dynamic" scoring may sound good in theory but that it would be extremely problematic in practice. I look forward to the testimony of the Chief of Staff of the Joint Committee on Taxation, Lindy Paull, on this issue and also the views of the Administration.

I know that we all benefit from an in-depth understanding of the methodology used by the JCT in creating the revenue estimates that the Committee uses in marking-up tax bills. Thank you, Mr. Chairman.