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April surplus reflects end of-season tax receipts, jump in

import duties

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Tariff revenue expected to drop after US-China trade deal

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Fiscal year outlays up due to Social Security, Medicare,

Treasury debt payments

By Ann Saphir

May 12 (Reuters) - The U.S. government posted a $258

billion budget surplus for April, up 23%, or about $49 billion,

from a year earlier, reflecting strong tax receipts in the final

month of the tax season and surging collections of import

duties, the Treasury Department said on Monday.

Treasury reported that net customs duties in April totaled $16

billion, about a $9 billion increase from the year-earlier

period. The increase occurred during a month in which President

Donald Trump boosted tariffs on Chinese goods to as much as 145%

while slapping at least 10% levies on imports of goods from

other countries.

The budget results indicate the U.S. collected just over

$500 million a day from tariffs in April. Trump last month said

the collections were about $2 billion a day.

For the first seven months of the fiscal year, net customs

duties totaled $63 billion, compared with $48 billion in the

same period a year earlier.

That new revenue, however, is likely to drop off. The U.S. and

China over the weekend reached a deal to temporarily ease their

steep tariffs on each other, with the U.S. cutting its 145%

duties to 30% for the next 90 days, while Chinese levies on U.S.

imports will fall to 10% from 125%.

Receipts last month were driven by a 16% increase in

individual non-withheld tax payments, which totaled $460

billion. Individual refunds also rose 16% to $86 billion,

detracting from net total budget receipts of $850 billion for

the month.

Treasury reported a $1.049 trillion budget deficit for the

first seven months of fiscal 2025, which started Oct. 1, up 23%,

or $194 billion, from a year earlier. Fiscal year-to-date

receipts of $3.110 trillion and outlays of $4.159 trillion were

both records for the year through April, though the deficit

itself was not, a Treasury official said.

After accounting for calendar differences that exaggerated

outlays recorded in 2024 and $85 billion in deferred tax

receipts from California that had boosted fiscal-year 2024

receipts, the deficit would have been 4% higher, according to

the official.

The 5% increase in unadjusted fiscal year-to-date receipts

was driven by a 6% increase in individual paycheck tax

withholdings to $2.145 trillion, accounting for the lion's share

of the total budget receipts.

The 9% increase in unadjusted fiscal-year-to-date outlays

was driven by higher spending on the Medicare health program for

seniors and the disabled, which was up 16% to $658 billion, and

on the Medicaid program for lower-income Americans, which was up

6% to $378 billion. Both programs saw enrollment climb and

service costs rise.

Spending on the Social Security retirement program rose 9%

to $945 billion on a fiscal-year basis, while payments to cover

Treasury debt interest climbed 10% from a year earlier to $684

billion.

The Treasury official said the weighted average interest

rate for the month was 3.29%, up 6 basis points from a year

earlier, but close to where it has been for the past five

months.