Record $2.1 Trillion in Taxes
Help Shrink Federal Deficit
By DEBORAH SOLOMON
August 11, 2007; Page A3
WASHINGTON -- Surging tax receipts continued to shrink the federal deficit through the first 10 months of the fiscal year, the Treasury Department reported Friday.
Since Oct. 1, when the fiscal year began, the government has run a deficit of $157.3 billion, sharply narrower than the $239.6 billion in the year-earlier period.
The narrowing stems from a record $2.1 trillion of tax revenue that has flowed into the Treasury's coffers so far this year, up 7% from the year-ago period. Tax receipts for July totaled $170 billion, up 6.6% from July 2006.
The strong tax receipts helped to compensate for higher spending, which has slightly outpaced 2006 levels. So far this year, the federal government has spent $2.27 trillion, up 3% from a year ago.
A month ago, the White House slashed its forecast for the 2007 deficit, saying it now expects to run a $205 billion deficit, down from its earlier $244 billion projection. The narrowing is being driven by better-than-anticipated tax receipts, particularly from corporations and wealthy individuals.
So far this year, individual income taxes are up 11% to $965 billion, with much of the increase stemming from taxes on investments and other sources of income more important to the wealthy. Receipts from these so-called nonwithheld taxes are up 13.5% so far this year. Corporations also helped to fill the coffers, with corporate tax receipts up 10.7% so far this year to $289 billion.
The improved deficit numbers come as Democrats and the White House continue to spar over 2008 spending.
Write to Deborah Solomon at deborah.solomon@wsj.com |
