By Rebecca Mayo, J.D.
The Congressional Budget Office (CBO) estimated that the federal budget deficit for the first four months of fiscal year 2018 was $174 billion, which is $16 billion more than the shortfall recorded during the same period last year. While the total receipts were up by 4 percent, the outlays were also higher by 5 percent. The federal government realized a surplus of $51 billion in January 2018, which is $1 billion smaller than the surplus in January 2017. Finally, the Treasury Department reported a deficit of $23 billion for December 2017, which is $3 billion less than the CBO estimated last month (CBO Report, February 7, 2018).
Quarterly receipts. Receipts totaled $1.131 trillion (1,131 billion) for the first four months of fiscal year 2018, which is $46 billion more than the same period last year. This increase came from a rise in individual income and payroll taxes (8 percent), which largely reflects increases in wages and salaries. Corporate taxes fell by about $13 billion (or 15 percent) and revenues from other sources fell by about $9 billion (or 11 percent).
Quarterly outlays. Outlays totaled $1.306 trillion ($1,306 billion), which is $62 billion higher than they were during the same period last year. This increase came from outlays for net interest on the public debt due to inflation (14 percent), spending for military programs of the Department of Defense (6 percent), outlays recorded for the Department of Homeland Security largely because of disaster relief (67 percent), and the rise in Social Security benefits due to increases in the number of beneficiaries and the average benefit payment (4 percent). Medicaid spending stayed relatively the same.
January surplus. While January 2018 receipts totaled $362 billion, which is $18 billion more than those in the same month last year, total spending was $311 billion, which is $18 billion more than the sum in January 2017. The increase in receipts can likely be attributed to an increase in withholding of individual income and payroll taxes partly due to January having one more business day than last year.
There was also an increase in revenue from other sources, mostly reflecting higher nonwitheld payments of income taxes by individuals. The largest increases in outlays were for January 2018 were increases in Social Security benefits (5 percent), net interest on the public debt (18 percent), Medicare benefits (17 percent), spending for military programs of the Department of Defense (5 percent), and outlays recorded for the Department of Homeland Security which were largely for disaster relief (37 percent).
Collections of fees and fines declined by $8 billion, largely because 2017 was the final year for collections from health insurers through the transitional reinsurance program of the Affordable Care Act (P.L. 111-148).
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