The US budget deficit \u2060rose by $217 billion to $1.99 trillion in the 2026 fiscal year, fueled in part by tariff refunds and record spending to service the nation’s more-than $40 trillion in debt, marking the largest budget shortfall in five years, Treasury Department figures reported on Friday showed.<\/p>\n\n\n\n
According to Reuters, the results for the year ended \u200bSeptember 30, compared to a $1.78 trillion deficit in fiscal 2025. It was the largest shortfall since fiscal 2021’s $2.77 trillion budget gap, then fueled by COVID-19 pandemic relief spending, and is the \u200cthird-largest annual deficit \u2060ever.<\/p>\n\n\n\n
Total receipts for fiscal 2026 were a record $5.40 trillion, up $169 \u200cbillion, or 3%, from the $5.24 trillion in fiscal 2025. Fiscal \u20602026 outlays also were a \u200brecord at $7.40 trillion, up $386 \u2060billion, or 6%, from the $7.01 trillion in the prior fiscal year.<\/p>\n\n\n\n
Debt-service outlays \u2060totaled a record $1.36 trillion, climbing by $144 billion, or 12%, a spending category now eclipsed \u2060only by Social Security and the combined outlays for Medicare and Medicaid. Total US debt breached the $40 trillion milestone \u2060about two months \u200bago.<\/p>\n\n\n\n
Another driver of the widening \u2060shortfall was a $22 billion drop in net tariff receipts following a Supreme Court ruling this year negating a large portion of the tariffs Trump had imposed during his first year in office. That triggered $145 billion of tariff refunds over this \u200byear, resulting in \u200can 11% decline in net tariff income to about $173 billion.<\/p>\n\n\n\n
A U.S. Treasury \u200bofficial said the department calculated an estimated deficit-to-GDP ratio of 6.2% for fiscal \u200b2026, but declined to say what GDP estimate was used. \u2060This figure compares to an actual 5.8% deficit-to-GDP ratio for fiscal 2025.<\/p>\n\n\n\n
For the 2026 fiscal year’s final month \u200bof September, the Treasury reported a deficit of $27 billion \u2060versus a $198 billion surplus a year earlier.<\/p>\n","protected":false},"excerpt":{"rendered":"
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