The final FY2015 federal budget deficit was $439 billion, down $44 billion (9 percent) from the FY2014 deficit of $483 billion. This drop in the deficit resulted from higher revenues (+$228 billion) offset by a smaller increase (+$184 billion) in government spending. In July, OMB projected the 2015 deficit would be $455 billion.
This marks the lowest recorded budget deficit since 2007 ($161 billion). From FY2009 to FY2012 the budget deficit exceeded $1 trillion.
Data on government expenditures and receipts and the deficit are reported in the Monthly Statement of Receipts and Outlays of the United States Government (MTS) prepared by the Treasury Department.
When measured as a percent of Gross Domestic Product (GDP), the FY2015 deficit dropped to 2.5 percent from 2.8 percent reported for FY2014. This is the lowest the deficit share of GDP since FY2007 (1.1 percent). During the period FY2009 to FY2012 the deficit’s share of GDP averaged about 8.5 percent.
Revenue growth in 2015 was led by a 10.5 percent increase in individual income tax receipts (+$146 billion). Corporate income taxes rose more than 7 percent (+$23 billion) and social insurance and retirement receipts increased by almost 5 percent (+$23 billion).
Spending on health programs and Medicare increased by $106 billion in FY2015. Social Security spending rose $37 billion and education programs (led by higher spending on student loans) increased by $31 billion. Outlays for national defense declined by $14 billion in FY2015.
OMB expects the brighter deficit picture in FY2015 to continue into 2016. However, both OMB and the Congressional Budget Office warn that deficits will begin to grow again due to revised assumptions showing slower economic growth.