The US government has posted a $US145 billion ($A217 billion) budget deficit for December, up 67 per cent or $US58 billion ($A87 billion) from a year earlier due to record outlays that were inflated by calendar shifts in benefit payments and receipts, the Treasury Department says.
The report showed that revenue growth from President Donald Trump’s tariffs may have plateaued, as December net customs receipts totaled $US27.9 billion ($A41.8 billion), down from the low $US30 billion ($A45 billion) range in recent months but far above the $US6.8 billion ($A10.2 billion) recorded in December 2024.
Net customs receipts for the first three months of fiscal 2026, which started October 1, totaled $US90 billion ($A135 billion) compared to $US20.8 billion ($A31.1 billion) in the prior-year period.
The Trump administration implemented some tariff-cutting trade deals in November, including 10 percentage-point reductions in duties on imports from China and South Korea. The Supreme Court also could soon rule on legal challenges to Trump’s tariffs under an emergency sanctions law. A ruling against those duties would further cut customs receipts.
The Treasury said that after making adjustments to December budget results in both 2024 and 2025, the December deficit would have been $US112 billion ($A168 billion), a decrease of $US14 billion ($A21 billion) or 11 per cent from the December 2024 budget gap.
Some $US32 billion ($A48 billion) in January 2026 benefit payments were shifted into December because the new year started on a weekend, while a net $US51 billion ($A76 billion) in December 2024 benefits were shifted to other months. But the $US145 billion ($A217 billion) reported deficit was a record for the month, a Treasury official said.
Military spending in December reached $US98 billion ($A147 billion), up $US20 billion ($A30 billion) or 25 per cent from a year earlier, due in part to the resumption of payments delayed by a government shutdown in October, the Treasury official said.
The deficit for the first three months of fiscal 2026, which started on October 1, 2025, totalled $US602 billion ($A901 billion), down $US109 billion ($A163 billion) or 15 per cent from the same period a year earlier amid record receipts and outlays. Fiscal year-to-date receipts totalled $US1.225 trillion ($A1.834 trillion), up $US142 billion ($A213 billion) or 13 per cent from a year earlier and a record for the period, due in part to collection of tax payments delayed by last year’s California wildfires.
Outlays for the first three months of fiscal 2026 were also a record, reaching $US1.827 trillion ($A2.735) trillion, up $US33 billion ($A49 billion) or 2.0 per cent from the year-earlier period.
The year-to-date outlay growth was fuelled by increases in Social Security and healthcare programs, as well as US Treasury public debt interest, which grew $US46 billion ($A69 billion), or 15 per cent from a year earlier, to $US355 billion ($A531 billion).
The Treasury official said the interest cost increase was driven largely by the growth of the US debt load, adding that the weighted average interest rate paid by the Treasury in December was 3.32 per cent, only slightly above the 3.28 per cent paid a year earlier.