In fiscal year 2023, which ended on September 30, the federal budget deficit totaled nearly $1.7 trillion—an increase of $320 billion (or 23 percent) from the shortfall recorded in the previous year. Revenues and outlays alike declined from 2022 totals—revenues fell by 9 percent, or $457 billion, and outlays decreased by 2 percent, or $137 billion. Those amounts differ only slightly from the amounts CBO estimated and discussed in last month’s Monthly Budget Review.
In 2023, the deficit was equal to 6.3 percent of the nation’s gross domestic product (GDP). That deficit is greater than the 50-year average of 3.7 percent and has been exceeded only six times since 1946 (from 2009 through 2012 and in 2020 and 2021). Compared with the size of the economy, federal debt held by the public also increased in 2023—rising to 97.3 percent of GDP from 95.8 percent of GDP at the end of fiscal year 2022.
Outlays were boosted at the end of 2022 and 2023 because October 1 (the first day of the next fiscal year) fell on a weekend. As a result, certain payments ordinarily made on the first day of the month were made earlier: $63 billion shifted from 2023 into 2022 and $72 billion shifted from 2024 into 2023. Taken together, those timing shifts increased payments in 2023 by $9 billion. If not for those shifts, the deficit in fiscal year 2023 would have been 28 percent larger—instead of 23 percent larger—than it was in 2022.
Originally published at https://www.cbo.gov/publication/59640