The Department of the Treasury and the Office of Management and Budget reported that the deficit dropped by $1.4 trillion, or 50 percent, to $1.37 trillion in fiscal year 2022 and that government receipts reached $4.89 trillion, reflecting an increase of 21 percent from FY 2021.
The rise in FY 2022 receipts can be attributed to higher corporate and individual income tax collections and retirement and social insurance receipts, according to OMB and the Treasury.
Outlays declined by 8.1 percent, or approximately $550 billion, to $6.27 trillion in FY 2022 due to reductions in spending related to the COVID-19 pandemic, including Small Business Administration programs and unemployment insurance initiatives.
Federal borrowing from the public totaled $24.3 trillion in FY 2022, showing an increase of $2 trillion. The two agencies linked the rise to borrowing needed to finance the deficit and net borrowing associated with other transactions.
“Today’s joint budget statement provides further evidence of our historic economic recovery, driven by our vaccination effort and the American Rescue Plan. It also demonstrates President Biden’s commitment to strengthening our nation’s fiscal health,” Treasury Secretary Janet Yellen said.
Under President Biden’s leadership, “more Americans are working today than at any point in our country’s history, our economy has added more than 10 million jobs, manufacturing is booming, and we cut last year’s deficit in half,” OMB Director Shalanda Young said.