WASHINGTON, D.C. – The U.S. budget deficit through the first five months of this budget year is up 14.8% from the same period a year ago, keeping the country on track to record its first $1 trillion deficit since 2012.
The Treasury Department said Wednesday in its monthly budget report that the deficit from October through February totaled $624.5 billion, $80.3 billion higher than the same period a year ago.
The deficit for February was $235.3 billion, up a slight 0.6% from February of last year. The government has recorded a deficit in February for 54 of the past 66 years.
The deficit so far this year reflects government spending that has grown by 9.2% compared to the first five months of the 2019 budget year while revenues are up a smaller 6.9%.
When President Donald Trump sent Congress his new budget last month he projected that the deficit for this year would hit $1.08 trillion but will then decline for the rest of this decade. By contrast, the Congressional Budget Office is forecasting that the deficit will remain above $1 trillion over the next decade.
These forecasts were made before the coronavirus spread to the United States, a development that is likely to trigger sharp declines in tax revenue and increased government spending to deal with the impact.
The government has not run deficits above $1 trillion except for a four-year period ending in 2012 when a deep recession reduced revenues and pushed spending higher.
Treasury Secretary Steven Mnuchin said Wednesday that the Trump administration is considering a plan to delay the April 15 tax deadline for many individuals and businesses.
This delay, Mnuchin said, would leave about $200 billion in the U.S. economy that would have gone to paying taxes. However, the temporary loss of this tax revenue means that the government will need to borrow more money until the payments are made.
The actual deficit for the 2019 budget year, which ended on Sept. 30, was $984.4 billion, up 26% from the 2018 imbalance. The rising deficits reflect the impact of the $1.5 trillion tax cut Trump pushed through Congress in 2017 and increased spending Congress has approved for the military and domestic programs.
Trump’s February budget projects that, if Congress goes along with his proposed spending cuts, which is highly unlikely, the budget would return to balance in 15 years.
Through the first five months of the budget year, government spending has totaled $1.99 trillion while tax receipts have totaled $1.37 trillion.