By Kate Davidson
WASHINGTON -- The U.S. budget gap grew 34% in the first month of the fiscal year as federal spending outpaced revenue growth, pushing the 12-month deficit past $1 trillion for the first time since February 2013.
The government ran a $134 billion budget deficit in October, the Treasury Department said Wednesday. Federal outlays totaled $380 billion, an 8% increase from a year earlier and a record for the month, driven by higher spending on the military, health care and Social Security.
Receipts last month totaled $246 billion, a 3% decline from last year, which the Treasury attributed in large part to a shift in the timing of certain payments.
If not for those calendar quirks, revenue would have grown 2% in October from a year earlier, and the deficit would have widened 19% in the first month of fiscal year 2020, the Treasury said.
Over the past 12 months, the government collected $3.4 trillion in revenue and spent $4.4 trillion, bringing the total deficit to just over $1 trillion, or 4.8% of gross domestic product.
Revenue from customs duties, or tariffs, increased 39% to $2 billion last month, reflecting the higher tariffs the Trump administration has imposed in recent months. That was offset by a decline in excise taxes, which a senior Treasury official attributed part to a moratorium on a fee the government collects from health-care providers under the Affordable Care Act.
Spending on the military and on the Department of Health and Human Services -- including Medicare and Medicaid spending -- rose 8% in October. Interest payments on the debt, one of the fastest-growing parts of the federal budget, declined 4% last month from a year earlier, reflecting falling borrowing costs as the Federal Reserve cut interest rates, a Treasury official said.
The government typically runs a deficit in October, which includes no major tax payment deadlines for individuals or corporations.
More broadly, the government is projected to continue running trillion-dollar deficits over the coming decade, as a wave of retirees pushes up mandatory spending on Social Security and Medicare.
Write to Kate Davidson at email@example.com
(END) Dow Jones Newswires
November 13, 2019 14:43 ET (19:43 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.