U.S. May Budget Deficit $399 Billion, Almost Double Year Earlier

(Bloomberg) -- The U.S. federal budget deficit almost doubled in May from a year earlier, as government spending surged amid efforts to limit the economic fallout from the coronavirus while revenue slumped.

The shortfall increased to $398.8 billion last month from $207.8 billion in May 2019, the Treasury Department’s report showed Wednesday.

Government spending rose 30% from a year earlier to $572.7 billion, as Congress approved $1,200-per-adult income support checks and also increased unemployment benefits under the CARES Act. Revenue dropped to $173.9 billion from $232 billion a year earlier, reflecting the economic slowdown.

The May figures follow a record deficit of $738 billion in April, which is typically a surplus month for the government as income tax payments come due. To ease the financial burden on individuals, millions of whom found themselves furloughed because of the economic lockdown, the Trump administration pushed the tax-filing and payment deadline to July 15.

In the first eight months of fiscal year 2020, the U.S. budget deficit was $1.88 trillion, compared with $738.6 billion at the same point last year. The Congressional Budget Office estimated in May that pandemic relief efforts will swell the deficit by $2.2 trillion this fiscal year and another $600 billion in fiscal 2021.

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