The U.S. government posted a $228 billion budget deficit for June, up 156% from a year earlier as revenues continued to weaken and July benefit payments were accelerated into June, the U.S. Treasury Department said on Thursday.
The deficit compares to a June 2022 budget gap of $89 billion. June receipts fell $42 billion, or 9% from a year ago, to $418 billion, while June outlays rose $96 billion, or 18%, to $646 billion.
But some $86 billion worth of July benefit payments were made in June because July 1 fell on a weekend, and without these and other calendar adjustments, the June deficit would have been $142 billion -- a 66% increase over June 2022.
For the first nine months of the 2023 fiscal year, which ends Sept. 30, receipts fell $423 billion, or 11%, from the year-ago period to $3.413 trillion. The decline was primarily driven by lower non-withheld individual income taxes due to lower capital gains in 2022 and lower year-end salary bonuses, as well as sharply higher individual tax refunds as the Internal Revenue Service cleared a backlog of unprocessed receipts.
The Federal Reserve has earned $93 billion less this year because it is paying higher interest on bank reserves and no longer has positive net income - a situation that a Treasury official said was expected to continue.
Year-to-date outlays rose $455 billion, or 10% from a year earlier to $4.805 trillion. Higher outlays for Social Security this year have been driven by cost-of-living adjustments, while the interest on the public debt so far this year has risen $131 billion, or 25%, to $652 billion due to higher interest rates.
Also driving up outlays were $52 billion in Federal Deposit Insurance Corp costs to resolve failing banks, a Treasury official said.
