TAX DAY PLUS ONE

Tax day has come and gone and hopefully it's behind us for those reading this article.

I wanted to highlight some important math from CBO’s March 2024 Monthly Budget Review and the Monthly Treasury Statement.

Over the first six months of the fiscal year, gross interest on the debt has accumulated to $522.023 billion. Individual income tax receipts were $1.09 trillion. Gross interest costs were 47.9% of individual income tax receipts, and if using net interest, that's 39.4% year-to-date.

Using the Treasury Department’s full-year estimates, gross interest is projected to be $1.144 trillion. Individual income tax receipts are estimated to be $2.503 trillion, meaning gross interest costs are estimated to be 45.7% of total individual income tax receipts this year.

The Treasury Department doesn't publish a full-year estimate for net interest costs. In President Biden’s FY25 budget request, the baseline estimate for net interest costs was $890 billion, resulting in 35.6% of the total full-year individual income tax receipts.

Our interest is greater than our defense budget. If we do not get our fiscal house in order we have very bad days ahead.