Aided by surging tax receipts, President Bush may make good on his pledge to cut the deficit in half in 2006 � three years early.
Tax revenues are running $176 billion, or 12.9%, over last year, the Treasury Department said Monday. The Congressional Budget Office said receipts have risen faster over the first eight months of fiscal '06 than in any other such period over the past 25 years � except for last year's 15.5% jump.
The 2006 deficit through May was $227 billion, down from $273 billion at this time last year. Spending is up $130 billion, or 7.9%.
The CBO forecast in May that the 2006 deficit could fall as low as $300 billion. Michael Englund, chief economist of Action Economics, has long expected a deficit of about $270 billion this year. Now he thinks there's a chance the "remarkable strength in receipts" will push the deficit even lower.
With the economy topping $13 trillion this year, a $270 billion deficit would equal less than 2.1% of GDP, easily beating the president's 2.25% goal. Bush made his vow when the White House had a dour 2004 deficit forecast of 4.5% of GDP, or $521 billion. The actual '04 deficit came in at $412 billion, or 3.5% of GDP, before falling to $318 billion, or 2.6% of GDP, in 2005.
A CBO analysis last week noted that withheld individual income and payroll taxes are up 7.6% from a year ago, with the gains picking up in recent months.
"Those gains suggest solid growth in wages and salaries in the national economy," CBO said.
While gains are broad, those at higher-income levels are enjoying bigger salary hikes. Because they pay higher rates, federal tax revenues soar when they do well.
Those making over $200,000 now pay 46.6% of total income taxes, presidential adviser Karl Rove recently said. That's up from 40.5% � despite Bush's tax cuts.
Nonwithheld income tax receipts are up about 20% vs. a year ago. That may reflect year-end bonuses and capital gains.
Corporate income taxes are up about 30% from last year's pace.
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1 comment:
Serious Illness Acquired @ work. Hospital loses all records. I am a RN who works in a large hospital Recovery Room.
I was brought a patient with a very virulent form of herpes zoster virus
in his lungs. He was supposed to be in strict isolation but no one told
us. I was in very close contact with him for over 2 hours. Now I have
chronic herpes zoster with outbreaks on my face. The hospital will not
allow me to work when the rash is on my face and refuses to grant me
workmans comp. Also I applied for FMLA and they have ignored it and cut
my hours in half. My medical bills are mounting by the week- I cannot
keep up and my health is failing. Even Social Security has denied me.
Please advise. Any advise would be appreciated. This is affecting my
retirement pension, life insurance plan, I have
used up all my savings and am in debt. If I loose medical coverage I
will probably die because I can not afford the medications. The Hospital
says that all the records are lost. Another child contracted the same
disease from this child. DNA testing could prove without a doubt I got
this illness from this patient and this is gross negligence on the
hospitals part. I need Workers Comp coverage and they refuse to help (3
times I applied) Please advise. I have outbreaks that are coming on more
and more frequently with scarring on my face and throat. My daughter had
a baby in May and I still cannot see my grandson because I am still
shedding the virus and if he gets chickenpox he could become blind or
deaf. I implore you - please direct me. I have a excellent attorney who
is working very hard to help me get workers comp but the hospital cannot
find the patients record or my incident report that I filled out and all
the nurses who were there that night signed. We were all exposed-
including the fresh post op patients. My health is failing and I am
going to have to go out on disability and social security. Please
advise. Thank you for your time. Patricia Daniels 386 454 5652 25606 NW
79th Place// High Springs,Florida 32643// LZACK7@cs.com
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