U.S. Fiscal 2026 Deficit Hits $1.993 Trillion, Widest Since 2021

The Congressional Budget Office estimated the federal budget deficit at $1.993 trillion for fiscal year 2026, which ended September 30 — the widest gap since 2021 and $218 billion above the fiscal 2025 shortfall. The deficit exceeded 6% of GDP, up from 5.8% a year earlier. Federal spending totaled $7.4 trillion, a 6% increase, while revenue rose 3% to $5.4 trillion, the CBO said. Net interest on the public debt climbed $115 billion, or 11%, to $1.143 trillion, surpassing outlays for national defense or Medicare. Social Security spending rose 5% to $1.654 trillion; Medicare and Medicaid each grew 8%. Corporate income tax revenue fell 16% to $382 billion after the 2025 reconciliation act expanded investment deductions. Customs duties dropped 11% as the administration issued roughly $130 billion in tariff refunds following a Supreme Court ruling. "The $2 trillion deficits in a growing economy ... is an unsustainable trend," said Shai Akabas of the Bipartisan Policy Center.