April 2, 2008

Uncle Sam Had a Decent Collections Month; Rest of Year Won’t Be So Good

Filed under: Economy,Taxes & Government — Tom @ 9:36 am

Here’s preliminary info on Uncle Sam’s collections during March, based on the last Daily Treasury Statement of the month:

UStreasRecsPrelim0308

Withholdings came in okay. The lower corporate taxes probably reflect lower expected profits for 2008 by many companies. The not-withheld’s increase isn’t that big of a deal. The lower refunds partially offset February refunds that were much higher than February 2007.

I think total receipts on March’s Monthly Treasury Statement will come in at $175 billion, about 5% ahead of March 2007. The real question is whether spending, which in fiscal 2008 has been running a ridiculous, unsustainable 10% higher than fiscal 2007, will show any sign at all of mellowing. March 2007′s single-month deficit was $96 billion. It would be nice to think that the March 2008 deficit might be as low as $50 billion, but at the rate money has flown out the door during the current fiscal year, $100 billion wouldn’t surprise me.

Looking ahead to April, last year’s collections of $383.6 billion — a single-month record, and the ultimate vindication of the effectiveness of the Bush supply-side tax cuts — won’t be duplicated. I think we’ll be lucky if they top $325 billion. At April’s end, year-to-date collections for fiscal 2008 will actually trail fiscal 2007 — and this is before the economic-stimulus refund checks start going out in May.

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1 Comment

  1. “The Democrat Effect” in action.

    Comment by Joe C. — April 2, 2008 @ 1:27 pm

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