The US government began fiscal 2027 with a $404 billion budget deficit in October, a record for the month, as receipts fell and outlays climbed sharply, according to the Treasury Department.
The US government began its 2027 fiscal year with a $404 billion budget deficit in October, a record for the month, according to Reuters. The Treasury Department reported that the shortfall was $120 billion, or 42%, larger than the same month a year earlier, as receipts declined and outlays climbed sharply.
October receipts dropped by $35 billion, or 9%, to $369 billion, partly reflecting lower net customs duty collections. Individual non-withheld taxes came in $29 billion, or 36%, below year-ago levels, which had been inflated by tax filing deadlines pushed back for Californians affected by the 2025 wildfires.
Reported October outlays reached a record for the month at $773 billion, an increase of $84 billion, or 12%, from a year earlier. Part of the rise came from a $14 billion, or 80%, increase in Department of Agriculture spending tied to farm relief payments, and a $28 billion, or 30%, increase in military spending. The military increase included an October payment to military trust funds that had been delayed by the prior year's government shutdown, along with higher costs across operations, maintenance and procurement.
Gross interest on the federal debt rose $11 billion, or 11%, from the previous October to $115 billion.
After calendar-related adjustments for November benefit payments that were shifted into October in both fiscal years, the Treasury said the adjusted deficit would have been $285 billion, up $94 billion, or 49%, from the prior-year period.
Sources
This article was drafted with AI assistance and checked against the sources above. Company claims are reported as claims. Cover image is AI-generated.
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