The U.S. government recorded a higher budget surplus for the month of April than a year ago thanks to a rise in tax receipts, while steeper debt-servicing costs continue to impose a major drag.
The surplus for April — when individual tax filings are due — was $210 billion, up 19% from the same month last year. For the seven months in the fiscal year to date, the budget recorded a deficit of $855 billion, down 8% from the year before.
April's receipts were helped by a shifting of filing due dates from fiscal year 2023 for certain taxpayers affected by natural disasters, a Treasury official said.
Meantime, the interest burden on outstanding U.S. debt remained a key driver of higher outlays, contributing to the sizable deficit for the year to date. Interest costs in the first seven months of the fiscal year through April were $624 billion, a 36% jump from 2023.
The Federal Reserve's aggressive interest-rate hiking campaign — aimed at quelling high inflation — has made debt more expensive, increasing the burden for the U.S. budget.
The weighted average interest rate on outstanding U.S. interest-bearing government debt was 3.23% at the end of April — the highest since 2010 and marking a roughly 65 basis point increase from a year before.
