FY 2011 Federal Budget Deficit Approaches $1 Trillion

The federal budget deficit for the first nine months of fiscal year (FY) 2011 was an estimated $973 billion, according to a report released on July 8 by the Congressional Budget Office (CBO). (Monthly Budget Review) This amount is $31 billion less than the deficit recorded for the same period in FY 2010. Revenues during the nine-month period were $1.73 trillion, an 8.5% increase compared to FY 2010. Individual income taxes, the largest tax source, showed a gain of 24%. “In contrast, social insurance taxes fell by 5% because the temporary payroll tax reduction more than offset the impact of higher wages and more employment,” CBO said. Corporate income tax receipts for the nine-month period were up $2 billion (or 1%). “However, gross receipts in April and June, which largely reflect quarterly estimated payments on 2011 activity, were lower than the corresponding payments made in the prior fiscal year,” CBO said. On the spending side, outlays for unemployment benefits were $95 billion, a decrease of 23.1%. However, net interest on the public debt jumped from $171 billion to $202 billion, a 17.8% increase. The budget review is available at http://cbo.gov/ftpdocs/121xx/doc12165/2011_06_MBR.pdf.