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Economy in Brief

U.S. Government Budget Deficit Stays Roughly Steady in December
by Tom Moeller  January 13, 2021

• Deficit share of GDP continues to rise.

• Outlay surge still driven by increased jobless benefits.

• Personal tax receipts remain under pressure.

The U.S. Treasury Department reported that the federal budget deficit of $143.6 billion during December compared to November's $145.3 billion. It pulled the deficit for this fiscal year's first quarter to $572.9 billion compared to $356.6 billion last year. The Action Economics Forecast Survey anticipated a December deficit of $234.0 billion.

Federal government outlays have risen 18.3% y/y so far in FY'21. The increase was driven by a 77.1% surge in income security payments stemming from coronavirus relief payments and a higher unemployment rate. Spending on health programs increased 27.7% y/y. Social security payments grew 13.7% y/y while defense outlays rose 4.1% y/y so far in FY'21. Medicare payments grew 3.2% y/y.

Overall revenues have declined 0.4% y/y so far this fiscal year. The recession has lowered individual income tax payments by 9.8% y/y and corporate tax receipts by 16.1% so far in FY'21. Growth in social insurance taxes rose to 9.4% y/y, but the reduction in global economic trade lowered customs duties by 14.1% y/y.

Haver's data on Federal Government outlays are contained in USECON; detailed data can be found in the GOVFIN database. The Action Economics Forecast Survey numbers are in the AS1REPNA database.

United States Government Finance Dec FY'20 FY'19 FY'18 FY'17
Budget Balance (Billion $) -- $-143.6 $-3,132 $-984.16 $-779.00 $-665.80
Fiscal YTD -- -572.9 -- -- -- --
  As a percent of GDP -- 27.1% 16.1% 4.6% 3.8% 3.5%
% of Total (FY 2020)
Net Revenues (Fiscal Year YTD 2021, Y/Y % Change) 100 -0.4% -1.2% 4.0% 0.4% 1.5%
  Individual Income Taxes 47 -9.8 -6.4 2.0 6.1 2.7
  Corporate Income Taxes 6 -16.1 5.3 12.5 -31.1 -0.8
  Social Insurance Taxes 38 9.4 5.4 6.2 0.8 4.2
  Customs Duties 2 -14.1 -3.2 71.4 19.4 -0.8
Net Outlays  (Fiscal Year YTD 2021, Y/Y % Change) 100 18.3 47.3 8.2 3.2 3.3
  National Defense 11 4.1 5.6 8.8 0.1 6.1
  Health 11 27.7 28.0 6.1 9.8 -1.9
  Medicare 12 3.2 19.2 10.6 -1.4 0.6
  Income Security 19 77.1 145.0 3.9 -1.6 -2.1
  Social Security 17 13.7 4.9 5.7 4.5 3.1
  Veterans Benefits & Services 3 8.1 9.3 11.8 1.3 1.2
  Education, Training, Employment & Social Services 4 16.5 75.5 43.8 -34.0 31.6
  Interest 5 -12.2 -8.2 15.7 23.6 9.1
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