Federal tax revenues are up 16 percent this year compared to 2012, helping power a major drop in the federal deficit, according to the latest estimate Tuesday from the Congressional Budget Office.
CBO’s numbers show that even with Congress gridlocked, the budget picture is improving, thanks in large part to spending cuts negotiated over the last two years that are beginning to kick in, along with tax increases lawmakers negotiated at the beginning of the year.
Through the first seven months of fiscal year 2013 the government has taken in $132 billion more in individual income taxes, $52 billion more in payroll taxes and $24 billion more in corporate income taxes.
Meanwhile spending has dropped $11 billion, thanks in large part to defense cuts and expiration of some part programs such as the Wall Street bailout.
Entitlement programs continue to grow, however, with Medicare, Medicaid and Social Security totaling $65 billion more so far this year.
In April alone the federal government ran a $112 billion surplus.
CBO issues a preliminary estimate of the federal budget every month. The Treasury Department will issue exact figures later this month.