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Economy in Brief

U.S. Federal Government Budget Deficit Shrinks in July
by Tom Moeller  August 10, 2022

• Receipts strengthen y/y as outlays fall sharply.

• Personal income tax receipts surge.

• Income security payments decline.

The U.S. Treasury Department reported a federal budget deficit of $211.1 billion in July 2022 compared to a $302.1 billion deficit one year earlier. The Action Economics Forecast Survey expected a $159 billion deficit for July. So far in FY'22, the deficit has totaled $726.1 billion versus $2.540 trillion in the first ten months of FY'21.

Overall revenues have increased 23.7% y/y so far in FY'22. Individual income tax receipts increased 32.7% y/y as employment continued to rise. Corporate tax payments rose 11.4% with strength in business earnings. Social insurance taxes rose 13.8% y/y so far in FY'22 and excise taxes rose 18.0% y/y.

Federal government outlays declined 17.5% year-to-date in FY'22 versus FY'21. Income security payments halved so far this year in the absence of economic stimulus checks. National defense outlays fell 2.1% y/y so far in FY'22. Outlays on health programs rose 16.1% y/y in the first 10 months of FY'22. Social Security outlays increased 7.1% y/y this fiscal year and medicare outlays fell 4.3% y/y so far this fiscal year. Interest payments surged by 29.2% y/y so far in FY'22.

Haver's data on Federal Government receipts & outlays are contained in USECON. The expectations figure is in the AS1REPNA database.

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