Tags: budget | deficit | economy | recession

US Budget Faces Nearly $2T Deficit for Fiscal Year

graphic shown the words federal deficit on a strip of paper on top of 3 one hundred dollar bills
(Dreamstime)

By    |   Tuesday, 09 June 2020 01:32 PM

The U.S. budget for this fiscal year faces a deficit totaling close to $2 trillion, The Wall Street Journal reports.

The Congressional Budget Office said Monday that the federal deficit grew to $424 billion in May, which is more than twice the amount of the shortfall in May 2019.

For the first eight months of the fiscal year, which started in October, the deficit totaled $1.9 trillion. During the same time frame in 2019, the deficit was just $739 billion, the CBO reported.

The office estimates that the deficit can continue to climb and reach $3.7 trillion by the time the fiscal year ends in September, according to the Wall Street Journal.

The budget shortfall comes as the coronavirus pandemic forced federal spending to increase and revenue to fall.

Federal spending was up 53% last month, totaling $598 billion, as Congress approved economic relief measures to help businesses impacted by virus lockdowns.

With less people working, the federal revenue took a dip, the newspaper reports. In May, federal revenue fell 25% from last year to $175 billion. The government collected less money from payroll and income taxes as unemployment rates spiked. Congress also allowed taxpayers to defer tax payments, which reduced revenue.

Before the coronavirus outbreak, federal revenue for this fiscal year was up about 6%, according to the report. Now, revenue collected by the government is down about 11%. 

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The U.S. budget for this fiscal year faces a deficit totaling close to $2 trillion, The Wall Street Journal reports.
budget, deficit, economy, recession
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2020-32-09
Tuesday, 09 June 2020 01:32 PM
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