Federal Deficit Hit $1.993 Trillion in Fiscal 2026 as Spending Grew Twice as Fast as Revenue, CBO Says
The gap was $218 billion wider than a year earlier. Interest on the debt was the biggest single increase, and tariff collections fell after the Supreme Court struck down the emergency-powers tariffs.
The federal government ran a deficit of $1.993 trillion in the fiscal year that ended Sept. 30, the Congressional Budget Office reported Thursday, Fox Business says.
The headline numbers. The deficit rose $218 billion, or 12%, from $1.775 trillion in fiscal 2025. Tax receipts grew 3% to more than $5.4 trillion. Spending grew 6% to nearly $7.4 trillion, so spending rose about twice as fast as revenue. Fox puts the national debt above $40 trillion.
Where the money went. Net interest on the debt was the largest increase, up $115 billion, or 11%, because the debt is larger and long-term rates are higher. Social Security benefits rose $86 billion (5%), Medicare $77 billion (8%) and Medicaid $55 billion (8%). Military spending rose $48 billion (5%), led by research and development and personnel. Education Department spending rose $41 billion, or 117%, mostly because of how student loan costs were estimated, CBO said.
Where revenue came from. Individual income and payroll taxes rose $255 billion, or 6%. Corporate income tax fell $70 billion, or 16%, because the 2025 reconciliation law allowed larger deductions for certain investments. Customs duties fell $22 billion, or 11%. CBO said more was collected early in the year, then collections dropped from May when the administration began issuing refunds after the Supreme Court struck down the emergency-powers tariffs.
The reaction. Maya MacGuineas of the Committee for a Responsible Federal Budget said the deficit "ranks among the highest deficits in our history, and the highest ever outside of a war or recession." She urged a goal of 3% of the economy, about half the current level, to be reached through a bipartisan fiscal commission.
Note for readers: the figures are CBO's, relayed by Fox Business, and MacGuineas' call for a commission is her group's position. We did not check CBO's tables ourselves.