The United States government ran up a smaller deficit than a year ago in January, due to a surge in tariffs, which are still under scrutiny by the Supreme Court over their legality.
Custom duties collected through tariffs totalled to US$30 billion for the month, bringing the fiscal year-to-date tally to $124 billion. This is 304% higher than the same period in 2025.
President Donald Trump first levied duties across the board in April 2025 with a menu of so-called reciprocal tariffs. Since then, the White House has been negotiating with trading partners and backing off on some of the more aggressive charges.
This comes as the Supreme Court heard oral arguments challenging Trump’s tariffs.
The decision was expected in January, but the Supreme Court has yet to announce its ruling.
A negative ruling could result in the White House having to reimburse the duties it has collected so far, which have helped put a dent in the pace of the budget deficit.
In the fourth month of the fiscal year, the shortfall totalled roughly $95 billion, down about 26% from the same period a year ago, the Treasury Department reported.
Year to date, that put federal red ink at $697 billion, or down 17% from the same period of fiscal 2025, according to numbers not adjusted for calendar. Calendar adjustments put the deficit reduction at 21%.
