Deficit In First Six Months Of Fiscal Year 2023 Surpasses $1 Trillion

The Congressional Budget Office (CBO) has reported a budget deficit of $1.1 trillion for the first six months of the fiscal year, from October 2022 until March 2023. Increased spending and lower revenue intake are the reasons behind the deficit. The federal government spent $3.1 trillion but received only $2.0 trillion in the period, depicting a 13% rise from the $2.8 trillion spent and 3% reduction from the $2.1 trillion received in the same period last year. The budget deficit has jumped by $430 billion from the $668 billion seen between October 2021 and March 2022.

The receipts from other sources, such as customs duties and remittances from the Federal Reserve, reduced by $53 billion, while individual income and payroll taxes dropped by $33 billion, but collection of corporate taxes increased by $13 billion. Increased expenditure emerged largely from an additional $141 billion for Social Security, Medicare, and Medicaid costs and also an added $90 billion for interest expenses on the national debt of the US.

According to President of the Committee for a Responsible Federal Budget, Maya MacGuineas, “Our fiscal challenges will only become more difficult the longer we wait to do anything.” The national debt of the US is currently $31.6 trillion, about 20% of the GDP of the country. Members of the House Freedom Caucus have already announced that they would oppose the raise of the debt ceiling until their proposals, which would create a topline discretionary spending level at the 2022 fiscal year for a decade and allow 1% annual growth, is approved by Congress.