During his administration's mid-year congressional review, President Bush said that high tax revenues were responsible for helping the government reduce the budget deficit faster than originally anticipated.
According to the White House, the federal government is projected to finish the fiscal year on Sept. 30 with a deficit of $296 billion, about $127 billion less than initially forecast. Tax receipts will total about $2.4 trillion, close to $119 billion more than expected, thanks largely to a spike in corporate tax payments -- up 19 percent for the fiscal year (and nearly tripling since 2003), compared with an 11 percent increase in overall collections. Last week, the Congressional Budget Office said that corporate payments through June were nearly 26 percent higher than at the same time last year.
Increased revenues also came from a rise in tax collections on executive bonuses and stock-market profits.
President Bush pointed to his administration's tax cuts as the fuel behind an economic resurgence; tax revenues are climbing twice as fast as the administration predicted in February. Democrats and some independent analysts have said that this year's receipts only look good compared to the weak returns of the past five years.
In January, the Congressional Budget Office projected that this year's deficit would be $371 billion, while the White House Office of Management and Budget put its estimate at $423 billion. Since President Bush took office in 2001, total federal debt has risen to $8.3 trillion, from $5.6 trillion at the end of the Clinton administration.
