Global| Mar 05 2019U.S. Government Budget Surplus Shrinks With Tax Cut
by:Tom Moeller
|in:Economy in Brief
Summary
The U.S. Treasury Department reported a federal government budget surplus of $8.7 billion during January compared to a $49.2 billion surplus during January 2018. A $6.0 billion surplus had been expected in the Action Economics [...]
The U.S. Treasury Department reported a federal government budget surplus of $8.7 billion during January compared to a $49.2 billion surplus during January 2018. A $6.0 billion surplus had been expected in the Action Economics Forecast Survey. So far this fiscal year, the federal government ran a $310.3 billion budget deficit compared to a $175.7 billion deficit in the first four months of last fiscal year.
Net revenues have declined 1.7% y/y so far this fiscal year. The cut in tax rates reduced individual income receipts by 5.4% y/y so far in FY'19, compared to a 6.1% rise during all of FY'18. Corporate income taxes fell by one-fifth y/y. Social insurance receipts rose 4.7% y/y following a 0.8% gain in FY'18, and excise taxes rose by nearly one-third y/y after last year's 13.3% increase.
Government spending has increased 8.8% y/y so far in FY'19. National defense spending strengthened 11.0% y/y, roughly double the y/y gain during all of last year. Health insurance spending increased 7.8% y/y while Medicare outlays rose 16.4% y/y. Growth in income security payments has increased 7.4% y/y so far in FY'19. Social Security payments increased a steady 5.2% y/y. Interest payments rose by 17.9% y/y with the larger budget deficit.
Haver's data on Federal Government outlays and receipts are contained in USECON. Considerable detail is given in the separate GOVFIN database. The Action Economics Forecast Survey numbers are in the AS1REPNA database.
| United States Government Finance | Jan | FY'18 | FY'17 | FY'16 | FY'15 | |
|---|---|---|---|---|---|---|
| Budget Balance (Billions) | -- | $8.7 | $-779.0 | $-665.8 | $-585.6 | $-439.1 |
| As a percent of GDP | -- | -- | 3.9% | 3.5% | 3.2% | 2.5% |
| % of Total | ||||||
| Net Revenues (Fiscal Year YTD 2018, Y/Y Change) | 100 | -1.7% | 0.4% | 1.5% | 0.6% | 7.6% |
| Individual Income Taxes | 51 | -5.4 | 6.1 | 2.7 | 0.3 | 10.5 |
| Corporate Income Taxes | -- | -20.7 | -31.1 | -0.8 | -12.9 | 7.2 |
| Social Insurance Taxes | 35 | 4.7 | 0.8 | 4.2 | 4.7 | 4.1 |
| Excise Taxes | 3 | 30.5 | 13.3 | -11.8 | -3.3 | 5.3 |
| Net Outlays (Fiscal Year 2017 YTD, Y/Y % Change) | 100 | 8.8 | 3.2 | 3.3 | 4.5 | 5.3 |
| National Defense | 16 | 11.0 | 5.3 | 6.1 | 0.7 | -2.3 |
| Health | 13 | 7.8 | 3.3 | -1.9 | 6.2 | 17.8 |
| Medicare | 14 | 16.4 | -1.4 | 0.6 | 8.7 | 6.7 |
| Income Security | 12 | 7.4 | -1.6 | -2.1 | 1.0 | -0.9 |
| Social Security | 24 | 5.2 | 4.5 | 3.1 | 3.2 | 4.4 |
| Veterans Benefits & Services | 4 | 23.3 | 1.3 | 1.2 | 9.3 | 6.8 |
| Education, Training, Employment & Social Services | 2 | 11.1 | -34.0 | 31.6 | -10.2 | 34.7 |
| Interest | 8 | 17.9 | 23.6 | 9.1 | 7.8 | -1.8 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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