A decline in revenue and increase in spending landed the United States a $215 billion budget deficit in February, which is the largest gap in the past six years.
Fiscal income dropped to $156 billion, down 9 percent from a year earlier, while spending rose 2 percent to $371 billion, the Treasury Department said on Monday. The deficit for the fiscal year that began in October widened to $391 billion, compared with a $351 billion shortfall the same period a year earlier, according to the Treasury report.
The data underscore concerns by some economists that Republican tax cuts enacted this year could increase the U.S. government debt load, which has surpassed $20 trillion. The tax changes are expected to reduce federal revenue by more than $1 trillion over the next decade, while a $300 billion spending deal reached by Congress in February could push the deficit higher.
The Congressional Budget Office pointed to higher tax refunds and a decrease in withheld individual income and payroll taxes as the culprits in an analysis released last week.
“Increases in wages and salaries were more than offset by a decline in the share of wages withheld for taxes,” the CBO said. That trend reflects new guidance issued in January by the Internal Revenue Service over how much of employees’ paychecks should be withheld based on the new tax rules, according to the CBO.