US Budget Deficit Narrows 7 Percent in May; Tariff Revenues Drop After Refunds

The federal government is still on track for a $2 trillion budget deficit for fiscal year 2026.

A view of a bus shelter at Pennsylvania Avenue and 22nd Street NW where an electronic billboard and a poster display the current U.S. National debt per person and as a nation at $38 trillion in Washington, D.C., on Oct. 28, 2025. Jemal Countess/Getty Images for the Peter G. Peterson Foundation

The U.S. budget deficit narrowed in May from the prior year, but tariff revenues declined that month as federal refunds began being issued.

Washington registered a $293 billion shortfall last month, down more than 7 percent from a year ago, according to new data the Treasury Department released on June 10.