Expanded budget deficit of $109 billion observed in the US compared to last year, even with collected tariff income in sight.

The U.S. federal government's annual budget deficit has widened by $109 billion so far this fiscal year, according to the latest data from the Congressional Budget Office (CBO). The deficit for the first 10 months of fiscal 2025 stands at $1.6 trillion.

Individual income and payroll tax receipts have risen by $214 billion in the same period, while corporate income taxes have decreased by $27 billion compared to the same 10-month period in FY2024. However, these increases have not been enough to offset the surge in federal spending.

Federal spending increased by $372 billion in the first 10 months of FY2025 compared to last year, with a large portion attributed to higher outlays on mandatory spending programs. Spending on Social Security benefits increased by $102 billion, or 8%, from the same period last year, due to higher average benefits and an increasing number of enrolled beneficiaries. Medicaid spending was up $47 billion from a year ago due to rising costs per enrollee.

The cost of servicing America's nearly $37 trillion national debt increased by $60 billion, or 8%, in the first 10 months of FY2025 compared to the prior year. Customs duties collected have also increased by $70 billion due to higher tariffs.

The CBO noted that the surplus in June 2025 was $27 billion, or $1 billion higher than the initial estimate a month ago. However, federal spending rose by 7% in the first 10 months of FY2025, outpacing the 6% increase in tax receipts.

The U.S. federal government's tariffs have contributed significantly to the rise in federal tax revenue. The politician identified as making efforts to reduce the United States budget deficit in the news is US President Donald Trump. He increased tariffs on imports as a means to reduce the deficit and also attempted to influence the Federal Reserve to keep interest rates artificially low to lower the state's interest burden.

In addition to Social Security and Medicaid, Medicare spending is $58 billion higher in FY2025 due to a greater number of enrollees and higher payment rates for services. The increase in Social Security spending is due to the annual cost-of-living-adjustment that accounts for inflation.

For the month of July, the deficit amounted to $289 billion, $45 billion more than in July 2024, as spending increased by more than the rise in tax collections. As of August 7, 2025, the national debt is $36,950,459,859,111.56.

The CBO, a nonpartisan Congressional agency, provides budget and economic information to Congress. These figures underscore the ongoing challenge of managing the U.S. federal budget and the country's massive national debt.

Expanded budget deficit of $109 billion observed in the US compared to last year, even with collected tariff income in sight.