Budget revenues last month collapsed by 55% to $241.863 billion against $535.545 billion a year earlier. This is because several tax payments for both companies and individuals were moved from April 15 to mid-July, the Ministry said.
At the same time, expenditures soared 2.6 times due to the introduction of various financial assistance programs and other support measures against the background of the COVID-19 coronavirus pandemic, as well as due to the payment of unemployment benefits. As a result, budget expenditures reached a record of $979.714 billion, compared to $375.240 billion in April 2019.
“These are striking figures. I didn’t think I would ever see this,” a senior Finance Ministry official said at a briefing on Tuesday. “They reflect the huge amount of support that Congress and the President’s administration are trying to respond to the crisis.”
For the seven months of the 2020 fiscal year, which began on October 1, the negative balance of the US budget increased by 2.8 times and exceeded $1.481 trillion. Revenue decreased by 9.7% to $1.845 trillion. Costs jumped 29.3% to nearly $ 3.327 trillion.
The congressional budget office (CBO) at the end of April predicted that the deficit at the end of the 2020 fiscal year would soar to $3.7 trillion, that is, to the level of the 40s. This will amount to 17.9% of GDP – the maximum since the Second World War. For comparison, during the financial crisis in 2009, the negative balance was $1.413 trillion, or 9.8% of GDP.
The negative balance of the US budget reached a peak of 27% of GDP in 1943, and then it remained above 20% of GDP in 1943-1945.
The state budget deficit for the last fiscal year, which ended on September 30, 2019, increased by 26%, reaching the highest level in the past seven years at $984.388 billion. It rose to 4.6% of GDP against 3.8% of GDP in the previous year.
The deficit increased for the fourth consecutive year, the most extended period of continuous growth since the early 1980s.
The last time a budget surplus was recorded in the United States was in 2001.