U.S. posts $27.48 billion June budget surplus

By Mark Felsenthal

WASHINGTON (Reuters) - The U.S. government posted a $27.48 billion budget surplus in June, putting the government on course for a smaller budget deficit in the 2007 fiscal year, a Treasury Department report showed on Thursday.

The June surplus, fueled by strong tax receipts, was 34 percent above the surplus of $20.52 billion recorded in a year earlier in June 2006, the Treasury said.

During the first nine months of fiscal 2007 that ends on September 30, the cumulative deficit has fallen by 41 percent to $120.97 billion from $206.48 billion in the comparable nine-month period in fiscal 2006.

June is typically a budget surplus month, with a quarterly filing deadline for individual income-tax returns mid-month that brings a flood of money to Treasury coffers.

The month's budget surplus was in line with expectations of analysts polled by Reuters.

The federal government took in total receipts of $276.52 billion last month, up 5 percent from $264.36 billion in June 2006. Outlays rose to $249.04 billion from $243.84 billion in June last year.

Both receipts and outlays were the highest on record for the month of June.

The latest cumulative deficit figures indicate the government is on positioned to trim the full fiscal 2007 deficit from the $248.2 billion shortfall reported for fiscal 2006.

President Bush on Wednesday predicted the deficit would narrow to $205 billion this year, making it the third straight year the budget has declined after hitting a record high in 2004.

Opposition-party Democrats countered with criticism that accumulated debt has risen to $9 trillion from $5.8 trillion when Bush took office in 2001.

The non-partisan Congressional Budget Office has estimated the deficit would be between $150 billion and $200 billion.