The federal government ran a budget deficit of $462 billion for the first 10 months of fiscal year 2014, CBO estimates—$146 billion less than the shortfall recorded over the same span last year. Through the end of July, revenues were about 8 percent higher and outlays were about 1 percent higher than they were at the same point last year.
On the basis of the revenue and spending totals thus far this fiscal year, CBO expects that the annual deficit will be in the vicinity of $500 billion, slightly larger than the $492 billion that it projected in April. CBO will publish new budget projections later in August, including an updated estimate of the deficit for fiscal year 2014.
| Budget Totals, October–July (Billions of dollars) |
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| Â | Actual, FY 2013 | Preliminary, FY 2014 | Estimated Change | |||
| Receipts | 2,287 | Â | 2,469 | Â | 182 | Â |
| Outlays | 2,895 | Â | 2,931 | Â | 36 | Â |
| Deficit (-) | -607 | Â | -462 | Â | 146 | Â |
| Sources: Congressional Budget Office; Department of the Treasury. Based on the Monthly Treasury Statement for June 2014 and the Daily Treasury Statements for July 2014. Note: FY = fiscal year. |
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Total Receipts: Up by 8 Percent in the First 10 Months of Fiscal Year 2014
Receipts for the first 10 months of fiscal year 2014 totaled $2,469 billion, CBO estimates—$182 billion more than receipts in the same period last year. The largest increases were the following:
-
Individual income taxes and social insurance (payroll) taxes together rose by $124 billion, or 7 percent.
- Increases in amounts withheld from workers’ paychecks—$97 billion (or 6 percent)—accounted for most of that gain. Growth in wages and salaries and changes in law were mostly responsible for the difference. In particular, the tax rates in effect from October 2013 through December 2013 (the first quarter of fiscal year 2014) were higher than those in effect from October 2012 through December 2012 as a result of two changes that took effect in January 2013: the expiration of the 2 percentage-point payroll tax cut and an increase in tax rates for income above certain thresholds.
- Nonwithheld receipts rose by $30 billion (or 7 percent) because of increased payments made for the 2013 and 2014 tax years. Those increases were slightly offset by income tax refunds that were up by $2 billion (or 1 percent).
- Receipts from corporate income taxes rose by $31 billion (or 15 percent), probably because of growth in taxable profits in calendar years 2013 and 2014. Receipts from April through June—largely representing corporations’ first two quarterly estimated tax payments for the 2014 tax year—increased by about $12 billion (or 12 percent).
- Receipts from the Federal Reserve rose by $22 billion (or 34 percent). The increase was attributable in part to the larger size of the central bank’s portfolio of securities and to a higher yield on that portfolio.
| Receipts, October–July (Billions of dollars) |
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| Major Program or Category | Actual, FY 2013 |
Preliminary, FY 2014 |
Estimated Change | |||||||
| Billions of Dollars | Percent | |||||||||
| Individual Income Taxes | 1,090 | Â | 1,144 | Â | 53 | Â | 4.9 | Â | ||
| Social Insurance Taxes | 790 | Â | 861 | Â | 71 | Â | 9.0 | Â | ||
| Corporate Income Taxes | 213 | Â | 244 | Â | 31 | Â | 14.6 | Â | ||
| Other Receipts | 194 | Â | 220 | Â | 26 | Â | 13.6 | Â | ||
| Â | Â | Total | 2,287 | Â | 2,469 | Â | 182 | Â | 7.9 | Â |
| Â | Â | Â | Â | Â | Â | Â | Â | Â | Â | Â |
| Memorandum: Combined Individual Income and Social Insurance Taxes |
 |  |  |  |  |  |  |  | ||
| Â | Withheld taxes | 1,630 | Â | 1,727 | Â | 97 | Â | 6.0 | Â | |
| Â | Other, net of refunds | 251 | Â | 278 | Â | 27 | Â | 10.7 | Â | |
| Total | 1,881 | Â | 2,005 | Â | 124 | Â | 6.6 | Â | ||
| Sources: Congressional Budget Office; Department of the Treasury. Note: FY = fiscal year. |
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