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Every month the U.S. Treasury releases data on the federal budget, including the current deficit. The following contains budget data for June 2021, which is the ninth month of fiscal year (FY) 2021.
The deficit for June 2021 was $690 billion smaller than the deficit recorded in June 2020. That difference is largely because last June included a large amount of spending in response to the pandemic. In addition, revenues were considerably higher in June 2021 than they were in June 2020. That increase is primarily due to the fact that the due dates for quarterly payments of individual and corporate income taxes, which typically fall in June, were delayed to July last year.
The cumulative deficit for the first nine months of FY21 was $506 billion smaller than it was through the first nine months of FY20. The decrease in the cumulative deficit reflects growth in revenues this year of $796 billion that was partially offset by a $290 billion increase in spending.
The sizeable deficit in FY20, and so far in FY21, has pushed up the current amount of debt held by the public by more than 25 percent relative to its level from before the onset of the COVID-19 pandemic. Once the situation has stabilized, policymakers should turn their focus to the country’s underlying fiscal situation.