The U.S. budget deficit increased 23.1 percent over the first nine months of the fiscal year compared to the same period the year before, the U.S. Treasury has said.
The deficit widened to $747.1 billion from October through June, as opposed to $607 billion last year, while federal spending jumped to $3.36 trillion in that period and revenue to $2.61 trillion, CNN informs. The figures do not present a good picture for the U.S. budget, the outlet adds.
The US has not had borrowing power since March, when the congressionally mandated debt ceiling kicked in. The federal government is running short on credit and could very well run out of money by September, independent analysts say, provided that Congress cannot agree on allowing additional borrowing.
The deficit jump is a result of several factors, among which President Donald Trump’s $1.5 trillion tax cut and a massive spending package.
According to the Trump administration, by September 30 when the fiscal year ends, the budget deficit will likely exceed $1 trillion for the whole fiscal year. As a comparison, a year earlier, it was $779 billion.
The numbers are considerably higher than forecasts by the nonpartisan Congressional Budget Office that the budget deficit will reach $896 billion and pass the $1 trillion mark in 2022.
CNN also informs that part of the increase in receipts for the period came from a 78% rise in custom duties, which totaled $52 billion so far for the budget year. The administration has imposed $250 billion worth of tariffs on Chinese products, increasing duties from 10 percent to 25 percent in May.