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US Individual Income Tax Revenues -26%



January 12, 2010 – Comments (0)

From the CBO Blog reviewing the December financials of the USoA, which can be found here.


In the first two months of this fiscal year, revenues were about $42 billion (or 14 percent) lower than they were in 2009. The three primary sources of receipts showed declines relative to last year: Individual income taxes decreased by $37 billion (or 26 percent), corporate income taxes fell by $10 billion, and social insurance taxes fell by about $1.5 billion (or 1 percent). Offsetting those declines was an increase of $7 billion in receipts from the Federal Reserve, primarily because of a shift in its portfolio to higher-yielding investments.

I find the closing sentence interesting. $48.5 billion in lost tax revenue is offset by an increase of $7 billion in receipts from the Fed Res. I guess a single Fed Res dollar coming is is worth seven tax revenue dollars. Not sure how that works, but there you have it. ;)  Actually, the really interesting part is that the Fed Res is moving in to higher yielding investments. I wonder what those could be. And, as an added bonus-random-though: doesn't higher yield generally mean higher risk? 

From the same report:

Social Security outlays up 10% ($11 billion)

Medicaid spending up 25% ($9 billion; American Recovery and Reinvesment Act [ARRA, aka "The Porkulus Package] was responsible for about two-thirds of that)

Medicare payments up 11% ($7 billion; mostly thanks to that prescription program we had to have)

Unemployment benefits up 200%+ versus prior year (approx. $14 billion)

Sing it with me, people!  Happy Days Are Here Again, The Skies Above Are Clear Again!

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