The US budget returned to surplus territory in April, thanks to higher than expected tax receipts. The annual budget deficit could thus fall this year below the symbolic threshold of 1,000 billion dollars, which it had exceeded for two years due to the support measures taken to deal with the coronavirus crisis.
In April, the budget thus came out with a surplus of 308 billion dollars, a record monthly surplus, thanks to the increase in tax revenues and the drop in expenditure linked to the end of aid linked to Covid-19, announced Wednesday the Treasury Department.
Tax revenues almost doubled to reach $864 billion (a record) against $439 billion in April 2021. Part of this increase is due to the fact that in 2021, due to the pandemic, the deadline for paying taxes had exceptionally been postponed from the end of April to the end of May. Government spending fell 16% to $555 billion in April, from $665 billion a year earlier.
For the first 7 months of the United States’ fiscal year, which will end at the end of September, the deficit has been reduced to $360 billion compared to $1,900 billion for the same period of 2021. For the full year 2021, the budget deficit was $2.772 billion, down $360 billion from its 2020 record of over $3.1 trillion. In 2019, the deficit was $984 billion.
The only downside to this encouraging budgetary picture, the total debt of the United States remained stuck at a record level of $30.4 trillion, which represents approximately 130% of the GDP of the world’s largest economy.