![]() |
|
![]() ![]() ![]() ![]() ![]() ![]() ![]() ![]() ![]() |
|
![]() |
|
|||
Based on the Monthly Treasury Statement for April and the Daily Treasury Statements for May | June 8, 2001 |
The federal government ran a surplus of about
$135 billion in the first eight months of fiscal year 2001, CBO estimates,
$14 billion more than in the same period last year. The recently enacted
tax bill will reduce the projected surplus for fiscal year 2001 by about
$74 billion, resulting in a total surplus for the year in the vicinity
of $200 billion if no further legislation affecting revenues or spending
is enacted this year. (The total surplus for fiscal year 2000 was $236
billion.)
APRIL RESULTS (In billions of dollars) |
||||||
Preliminary Estimate |
Actual | Difference | ||||
|
||||||
Receipts | 331 | 332 | * | |||
Outlays | 142 | 142 | * | |||
Surplus | 189 | 190 | * | |||
|
||||||
SOURCES: Department of the Treasury; CBO. | ||||||
NOTE: * = between zero and $500 million. | ||||||
|
The Treasury reported a surplus of $189.8 billion
in April, the largest monthly surplus ever and just a few hundred million
dollars more than CBO had projected on the basis of the Daily Treasury
Statements. The fact that revenues were $0.4 billion higher than CBO
anticipated accounted for most of the difference.
ESTIMATES FOR MAY (In billions of dollars) |
||||||
Actual FY2000 |
Preliminary FY2001 |
Estimated Change |
||||
|
||||||
Receipts | 146 | 125 | -21 | |||
Outlays | 150 | 156 | 6 | |||
Deficit (-) | -4 | -30 | -27 | |||
|
||||||
SOURCES: Department of the Treasury; CBO. | ||||||
|
CBO estimates that the Treasury recorded a deficit in May 2001 of about $30 billion--$27 billion more than in May 2000. Outlays were up by about $6 billion, and receipts were $21 billion below the level of last May.
Calendar differences and payments to the Treasury from the Federal Reserve account for the decline in receipts. The calendar contributed in two ways. First, the deadline for filing personal income tax returns this year was April 16, which enabled the Internal Revenue Service to process the returns and deposit the checks in time to include nearly all the receipts in April's tabulation. Last year, the filing deadline was one day later, and as a result, about $14 billion in receipts were included in May's tabulation. The calendar also contributed approximately $5 billion to the reduction in receipts because May 2001 contained one fewer Monday--typically the biggest payment day of the week--than did May 2000. In addition, receipts in May of last year were unusually high because of a one-time payment by the Federal Reserve implementing legislation enacted in 1999. That payment accounts for about $4 billion of the year-to-year difference. Adjusted for those three effects, receipts were slightly higher this May.
Medicare and Medicaid accounted for almost $5
billion of the increase in outlays. Defense spending was higher, and payments
of unemployment compensation also rose, by about $800 million. Spending
by the Commerce Department declined because last year's outlays included
costs for the decennial census.
BUDGET TOTALS THROUGH MAY (In billions of dollars) |
||||||
October-May
|
Estimated
Change |
|||||
FY2000 | FY2001 | |||||
|
||||||
Receipts | 1,318 | 1,378 | 60 | |||
Outlays | 1,198 | 1,243 | 46 | |||
Surplus | 121 | 135 | 14 | |||
|
||||||
SOURCES: Department of the Treasury; CBO. | ||||||
|
CBO estimates that the government recorded a surplus
of $135 billion for the first eight months of fiscal year 2001--about $14
billion more than for the same period last year. Receipts in those eight
months were about $60 billion higher than last year's, and outlays were
about $46 billion higher. The outlay figure for 2001 reflects the fact
that $7 billion in wages and benefits normally paid on October 1 were instead
disbursed in September (the previous fiscal year) because October 1 fell
on a weekend.
RECEIPTS THROUGH MAY (In billions of dollars) |
||||||||
October-May
|
Percentage
Change |
|||||||
Major Source | FY2000 | FY2001 | ||||||
|
||||||||
Individual Income | 665 | 705 | 5.9 | |||||
Corporate Income | 114 | 108 | -4.7 | |||||
Social Insurance | 434 | 465 | 7.2 | |||||
Other | 106 | 100 | -5.6 | |||||
Total | 1,318 | 1,378 | 4.5 | |||||
|
||||||||
SOURCES: Department of the Treasury; CBO. | ||||||||
|
Receipts for the first eight months of fiscal year 2001 were, by CBO's estimates, $60 billion, or 4.5 percent, higher than during the same period last year. Receipts from taxes that are based on personal income grew: social insurance receipts increased 7.2 percent, while individual income tax receipts rose 5.9 percent.
Weakness in corporate profits caused receipts from corporate income taxes to fall by 4.7 percent compared with the same period a year ago. The weakness has developed very recently: from February through May, corporate receipts declined about 20 percent compared with last year. An important indicator of corporate receipts occurs on June 15, when most corporations make their second quarterly payment of estimated taxes for tax year 2001. Largely as a result of the recent unexpected weakness in corporate receipts, CBO has reduced its projection of total receipts by $20 billion for fiscal year 2001 and by smaller amounts for 2002 and 2003.
Other receipts have also fallen
in the first eight months of fiscal year 2002, because of the effects of
legislation. The decline of $6 billion, or 5.6 percent, was caused by a
reduction in payments to the Treasury by the Federal Reserve. The 1999
legislation increased the Federal Reserve's payment in May 2000, leading
to a corresponding reduction in payments early in fiscal year 2001. That
acceleration in payments resulted in higher receipts in 2000 and lower
receipts in 2001, accounting for a year-to-year decline of $7.5 billion
for the October-May period. Other sources of receipts--excise taxes, estate
and gift tax receipts, customs duties, miscellaneous fees, and fines--have
all been close to last year's level.
OUTLAYS THROUGH MAY (In billions of dollars) |
|||||||||||
October-May
|
Percentage Change |
||||||||||
Major Category | FY2000 | FY2001 | Actual | Adjusteda | |||||||
|
|||||||||||
Defense--Military | 183 | 189 | 3.3 | 4.9 | |||||||
Social Security Benefits | 265 | 281 | 6.0 | 6.0 | |||||||
Medicare | 144 | 156 | 7.7 | 7.7 | |||||||
Medicaid | 77 | 86 | 12.3 | 12.3 | |||||||
Other Programs and Activities | 371 | 382 | 3.2 | 4.3 | |||||||
Subtotal | 1,040 | 1,095 | 5.2 | 5.9 | |||||||
Net Interest on the Public Debt | 158 | 149 | -5.6 | -5.6 | |||||||
Total | 1,198 | 1,243 | 3.8 | 4.4 | |||||||
|
|||||||||||
SOURCES: Department of the Treasury; CBO. | |||||||||||
a. Excludes the effects of payments that were shifted from October 2000 to September because October 1 was a Sunday. | |||||||||||
|
Outlays were 3.8 percent higher in the first eight months of fiscal year 2001 than in the same period last year, CBO estimates. Adjusted for the payments that were shifted from October 2000 into September, the growth rate was about 4.4 percent.
Among the major categories of spending, Medicaid
continues to show the most rapid growth--up by over 12 percent so far this
fiscal year. (It has grown at a rate of almost 14 percent over the past
four months.) Medicare spending has risen by almost 8 percent so far this
year, and that growth rate will accelerate because of increased payment
rates to health care providers. CBO projects that, by the end of the fiscal
year, Medicare spending will be 10 percent above last year's level.
CURRENT ESTIMATE FOR FISCAL YEAR 2001
In May, CBO revised its estimate of the surplus
for fiscal year 2001. Projected revenues were reduced by $20 billion, largely
reflecting weakness in corporate tax receipts. That change was partly offset
by a $14 billion drop in estimated outlays. The decline in outlays largely
results from a net reduction of $11 billion in estimated subsidy costs
for credit programs that the Office of Management and Budget plans to record
this year. In addition, the tax bill just enacted provides for $41 billion
in rebates and tax reductions in the current fiscal year and shifts about
$33 billion in corporate tax payments from September 15 to October 1. All
told, CBO now estimates that the surplus for fiscal year 2001 will be in
the vicinity of $200 billion.
NOTE: Unless otherwise indicated, the figures in this report include the Social Security trust funds and the Postal Service fund, which are off-budget. Numbers may not add up to totals because of rounding.
Prepared by Robert Sunshine and Mark Booth. |