US budget projected to post sizable surplus in April, lowering deficit so far this year

MarketsAssociated Press

The Treasury Department will release its report on the federal budget for April at 2 p.m. Eastern Tuesday.

SURPLUS: The Congressional Budget Office is projecting that the government ran a surplus of $155 billion last month, an increase of $48 billion over the $107 billion surplus recorded in April 2014. The government normally runs a surplus in April, a month when a flood of annual tax returns pushes up revenue.

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For the first seven months of the budget year, the CBO projects that the deficit will total $285 billion, $22 billion lower than the $308 billion deficit recorded in the same period last year.

The CBO is forecasting a full-year deficit of $486 billion, roughly on par with the 2014 deficit of $483.4 billion. The government's budget year runs from October through September.

The 2014 deficit was down from $680.2 billion in 2013. Before 2013, the U.S. had recorded four straight years of annuals deficits above $1 trillion, reflecting the impact of a severe financial crisis and the worst recession since the Great Depression of the 1930s.

President Barack Obama in February unveiled a budget for 2016 — his final full year in office — that seeks authorization from Congress to spend $4 trillion next year. It projects a deficit of $474 billion.

Obama's budget would boost spending on domestic programs such as increased road construction while raising taxes by $2 trillion over the next decade by boosting levies on the wealthy, corporations and smokers.

Republicans have attacked Obama's proposed tax increases and the fact that his budget plan never reaches balance. A GOP budget cleared Congress earlier this month. It sets a potential path for a balanced budget within a decade by cutting spending at domestic agencies and government benefit programs like Medicaid and food stamps.

Democrats charged that the GOP budget only balances on paper because Republican lawmakers will balk at approving the follow-up legislation that will be needed to enact the painful cuts that would achieve a balanced budget without raising taxes.