CBO now projects a deficit of $260 billion for fiscal year 2006, about $111 billion less than it estimated in March for the President’s budget (which included supplemental appropriations that have since been enacted). Most of that reduction results from higher-than-anticipated revenues. At 2.0 percent of gross domestic product, the 2006 deficit would be smaller than the deficits recorded in the past three years—3.5 percent in 2003, 3.6 percent in 2004, and 2.6 percent in 2005. So far this fiscal year, the federal government has run a deficit of about $239 billion, CBO estimates, $64 billion less than in the first 10 months of last year. On August 17, CBO will issue a report that presents its new 10-year budget projections and more detail on the updated 2006 estimate.
So, the CBO was off by more than $100 Billion dollars in analyzing the President's Budget. And the Budget Deficit shrinks to lowest levels in 3 years.
Receipts were about $18 billion (13 percent) higher in July 2006 than they were in July 2005. Withholding for individual income and social insurance (payroll) taxes, which accounted for most of the receipts in July, rose by more than $11 billion (almost 10 percent). This July had one more Monday and one fewer Friday than July 2005 did, which added an estimated $2 billion to withholding. Without those effects of the calendar, withholding would have been about 8 percent higher than in the same month last year, CBO estimates. Gross receipts from the small number of corporations that make income tax payments in July rose by $2 billion (19 percent).
as Fox News explains:
The $260 billion forecast for the current budget year, which the CBO previewed earlier this month, would represent an improvement from last year's actual deficit of $319 billion.
However, the detailed CBO report released Thursday showed that the improvement will be temporary with deficit expected to swell to $1.76 trillion over the next decade.
The new CBO report updates estimates made in March, when the CBO projected that the deficit for this year would be $111 billion higher. The improvement reflected strong gains this year in federal tax collections, reflecting an improving economy.
But in the new report, the CBO projected that the deficit for the next budget year, which begins Oct. 1, will climb to $286 billion, then decline slightly to $273 billion in 2008 before rising for the next two years.
The Bush administration points to the improved deficit outlook for this year as evidence that the president's first-term tax cuts worked to get the economy out of the 2001 recession and have led to stronger economic growth and tax revenues.
If the CBO can be more $111 Billion off for this year, how accurate can their 10 year predictions be? For now, I say take a bow Mr. President, the CBO was wrong, you were right, take some credit for a job well done.