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Budget Deficit Widens to $139 Billion

“The U.S. government posted a budget deficit of $139 billion in May, 11 percent higher than a year ago and above economists’ expectations, partly because of temporary calendar adjustments, the Treasury Department said.

May has had a deficit for 54 out of the last 59 years, a Treasury official said, as it is typically the month when the government refunds tax payments to U.S. citizens.

But so far this fiscal year, which began in October, the government budget deficit has shrunk faster than expected, standing at $626 billion at the end of May, 26 percent lower than the deficit in May 2012.

That is largely due to a 15 percent increase in tax receipts compared to last year, at $1.8 trillion, while spending has increased by only 1 percent. Revenues have been boosted because payroll tax cuts expired, taxes went up on richer Americans and the economy has started to recover.

The Congressional Budget Office last month estimated the United States is on track for its first deficit below $1 trillion since President Barack Obama came into office. The deficit should fall to 4 percent of GDP this year, less than half the shortfall in 2009, the CBO said….”

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