- The Washington Times - Wednesday, May 10, 2006

ASSOCIATED PRESS

A flood of income tax payments pushed up government receipts to the second-highest level in history last month, giving the country a sizable surplus for the month.

In its monthly accounting of the government’s books, the Treasury Department said yesterday that revenue for the month totaled $315.1 billion as Americans filed their tax returns by the April deadline. The gusher of tax revenue pushed total receipts up by 13.4 percent from April 2005.

It marked the largest one-month receipt total since the government collected $332 billion in revenue in April 2001, reflecting a boom in capital gains from stock investors lucky enough to cash out their investments before the bursting of the stock market bubble in early 2000.

Through the first seven months of the current budget year, which began Oct. 1, government receipts total $1.35 trillion, up 11.2 percent from the same period a year ago.

The strong gain in receipts has prompted many analysts to revise their estimates for the budget deficit this year.

The Congressional Budget Office last week announced it was lowering its deficit estimate for this year to $300 billion, significantly below a previous estimate of $350 billion.

The government ran up a $319 billion deficit for the 2005 budget year, the third-highest amount of red ink in dollar terms. The record deficit was $413 billion set in 2004.

The Bush administration will revise its own estimate of the budget deficit in midsummer. That outlook is certain to represent an improvement from the $423 billion deficit the administration had forecast in February.

While government spending has been pushed higher by the costs of fighting the war in Iraq and rebuilding devastated areas after the Gulf Coast hurricanes, that higher spending has been offset by higher-than-expected tax collections, reflecting the strong economy.

The big jump in revenue last month gave the country a surplus for the month of $118.8 billion. For the first seven months of the budget year, the deficit totals $184.1 billion, down 22.3 percent from the same period in 2005.

Government spending last month totaled $196.2 billion. Through the first seven months of the budget year, spending totals $1.54 trillion, up 5.7 percent from the same period in 2005.

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