![]() ![]() While financial markets had largely anticipated and priced in the increase, it will impact the deficit in the form of heightened debt servicing costs. In July, the Federal Reserve raised its benchmark federal funds rate by a quarter percentage point to a range of 5.25% and 5.5%-the highest level in 22 years-to combat ongoing inflationary pressures. Funding for several pandemic recovery programs continued recent trends, such as the $120 billion (44%) decrease in certain refundable tax credits (largely due to the expiration of the expanded Child Tax Credit), the $59 billion (71%) decrease in pandemic-related public health expenditures from the Public Health and Social Services Emergency Fund, and the $25+ billion (>100%) increase in Coronavirus Refundable Credits (such as for paid sick and family leave) due to delayed uptake by employers.$52 billion increase in spending by the Federal Deposit Insurance Corporation (FDIC) due to bank failures throughout spring 2023, which it expects to recover by liquidating the banks’ assets and collecting higher premiums from other FDIC-insured institutions over several years.$91 billion (57%) increase in Department of Education programs, largely due to newly recorded costs ($71 billion) in July associated with the Biden administration’s income-driven student loan repayment plan and modifications to student loan repayment policies.$146 billion (34%) increase in net interest payments on the public debt from rising interest rates and a growing debt burden.$244 billion (12%) increase in the largest mandatory spending programs, such as Social Security, Medicare, and Medicaid, reflecting increases in both the cost of benefits and number of beneficiaries.Outlays were $5.4 trillion, an increase of 11%, largely due to:*.(These collections count towards federal revenue, as UI is a federal program administered by states.) $12 billion (21%) decrease in unemployment insurance receipts, as states levied higher taxes on employers during FY2022 to replenish UI trust funds that were depleted from high unemployment during the pandemic.$16 billion (19%) decrease in customs duties due to a reduction in imports.$98 billion (99%) decrease in remittances from the Federal Reserve, as higher interest rates continued to raise the Fed’s interest expenses above its income and eliminate profits across most of its banks.$130 billion (59%) increase in individual income tax refunds. ![]() (Net receipts collected through July were approximately $300 billion less than prior CBO projections mainly because of weakened individual and corporate income tax revenue.) Of this amount, non-withheld payments of income and payroll taxes declined by $284 billion (26%), largely reflecting decreases in 2022 tax liabilities and delayed 2023 tax filings attributable to tax relief provided by the IRS for those affected by disaster situations. $313 billion (9%) decrease in individual income and payroll tax revenue.Revenues were $3.7 trillion, a decrease of 10%, largely due to:.The government ran a cumulative deficit of $1.6 trillion through July ($1.7 trillion when adjusted for timing shifts, $954 billion more than during the same period last year*).The July 2023 deficit was impacted by unique timing shifts in outlays, if not for which it would have been $309 billion instead of $222 billion, resulting in a YOY increase of $98 billion.*įiscal Year-to-Date Comparisons with FY2022.$499 billion in outlays, increased YOY by $18 billion (4%).$276 billion in revenues, increased YOY by $7 billion (3%).$222 billion deficit, increasing year-over-year (YOY) by $11 billion.Give Search Keywords Submit Policy Areas. ![]()
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