The federal budget deficit rose to $1.7 trillion in fiscal 2023, according to data released Friday by the Treasury Department.
The gulf between how much money the federal government spent and made in revenue rose by $320 billion between fiscal 2023 — which ended September 30 — and the previous fiscal year.
The fiscal 2023 budget deficit was equal to 6.3 percent of US gross domestic product (GDP), up from 5.4 percent in fiscal 2022.
Biden administration officials attributed the spike in the deficit to a steep drop in federal revenue, which rose sharply during rapid economic rebound from the COVID-19 pandemic. Federal receipts dropped by 9.3 percent from fiscal 2022, almost entirely due to a $456 billion decline in individual income taxes.
The government has also been gradually rolling out billions of dollars in funding for green energy, infrastructure and other Biden administration initiatives that officials say has boosted the economy through choppy waters.
“The US economy remains resilient despite global headwinds. Previous expectations that the
US would fall into recession over the course of 2023 have not borne out,” Treasury Secretary Janet Yellen said in a statement.
“The Biden Administration continues to focus on navigating our economy’s transition to healthy and sustainable growth. As we do, the President and I are also committed to addressing challenges to our long-term fiscal outlook.”