WASHINGTON — The U.S. federal budget deficit expanded nearly 20% in July to $291 billion, even as customs duty collections surged by almost $21 billion from tariffs imposed by former President Donald Trump, the Treasury Department reported Tuesday. The growth in spending outpaced the increase in revenues.
Compared with July 2024, the deficit rose by $47 billion, or 19%. Monthly receipts edged up 2% to $338 billion, while spending jumped 10% to $630 billion — the highest July outlay on record.
July had fewer business days than the same month last year. Adjusting for this, the Treasury said receipts would have been about $20 billion higher, narrowing the deficit to roughly $271 billion.
Customs revenue climbed sharply to $27.7 billion from $7.1 billion a year earlier, driven by higher tariff rates. These gains were consistent with June’s elevated customs collections, continuing a trend seen since April.
Although Trump has highlighted the billions generated by tariffs, these duties are paid by importing companies, with part of the costs often passed on to consumers through higher prices. Inflation data released Tuesday showed price increases for tariff-affected goods such as furniture, footwear, and auto parts, though lower gasoline prices helped offset the impact in the broader Consumer Price Index.
For the first 10 months of the fiscal year, customs duties reached $135.7 billion — a 116% increase from the same period last year.
Year-to-date, the federal budget deficit totaled $1.629 trillion, up 7% from a year earlier. Revenues for the period hit a record $4.347 trillion, up 6%, while spending rose 7% to a record $5.975 trillion.
