(Adds details from statement, lawmaker comment)
By David Lawder
WASHINGTON Oct 5 The U.S. federal budget
deficit fell to $161 billion in fiscal 2007 from $248 billion
the prior year as growth in tax receipts, fueled by capital
gains and other non-withheld income, outstripped spending
growth, the Congressional Budget Office said on Friday.
The CBO said in its monthly budget review that the federal
government ended its fiscal year on Sept. 30 with a $113
billion budget surplus for September, an increase of $57
billion over the September 2006 surplus.
The CBO's final full year 2007 deficit estimate was $3
billion larger than its previous estimate of $158 billion, made
in August, as both revenues and outlays ended the year slightly
less than it had forecast.
The U.S. Treasury is expected to release its final fiscal
2007 budget data on Wednesday. The White House budget office
has previously estimated a significantly larger fiscal 2007
deficit of about $205 billion.
A final figure matching either estimate would a mark a
third year of decline for the federal deficit since it hit a
record of $413 billion in 2004.
A key Democratic congressman said the latest reduction was
no cause for celebration.
"Republicans have overseen the largest fiscal reversal in
American history -- turning a $5.6 trillion ten-year projected
surplus into a $2 trillion deficit -- and yet the (Bush)
administration continues to advocate the same policies that
helped to create our fiscal mess,"said House Budget Committee
Chairman John Spratt of South Carolina.
The CBO said tax receipts grew by $161 billion in fiscal
2007 over the prior year to $2.568 trillion. Outlays grew by
$74 billion to $2.729 trillion, the CBO said.
The CBO said receipts from withheld individual income taxes
and payroll taxes grew by $107 billion, or 6.7 percent in
fiscal 2007 -- a similar growth rate to the prior two years.
But the biggest revenue growth driver was non-withheld
receipts, typically made up of taxes on capital gains and
dividend income, which grew 13 percent, or $55 billion, in
While corporate income tax receipts grew by 5 percent or
$18 billion, the rate slowed considerably from the 39 percent
average over the prior two years.
Year-on-year corporate income tax receipt growth slowed
progressively throughout 2007, with gains in the first three
quarters of 22 percent, 11 percent and 4 percent respectively,
followed by an 11 percent decline in the fourth quarter, the