The U.S. recorded a $215 billion budget deficit in February—its biggest in six years—as revenue declined.
Fiscal income dropped to $156 billion, down 9 percent from a year earlier, while spending rose 2 percent to $371 billion, the Treasury Department said on Monday. The deficit for the fiscal year that began in October widened to $391 billion, compared with a $351 billion shortfall the same period a year earlier, according to the Treasury report.
The data underscore concerns by some economists that Republican tax cuts enacted this year could increase the U.S. government debt load, which has surpassed $20 trillion. The tax changes are expected to reduce federal revenue by more than $1 trillion over the next decade, while a $300 billion spending deal reached by Congress in February could push the deficit higher.
Treasury Secretary Steven Mnuchin has said the tax cuts will pay for themselves through faster economic growth.
A combination of higher income tax refunds and a drop in the withholding of individual income and payroll taxes led to the reduction in receipts, according to an analysis by the Congressional Budget Office released last week.
“Increases in wages and salaries were more than offset by a decline in the share of wages withheld for taxes,” the CBO said. That trend reflects new guidance issued in January by the Internal Revenue Service over how much of employees’ paychecks should be withheld based on the new tax rules, according to the CBO.
The deficit in February was also impacted by the timing of certain payments, CBO said.