U.S. Budget Deficit Surges to $284 Billion Amid Government Shutdown

The U.S. government reported a significant budget deficit of $284 billion for October 2026, a figure influenced by the recent federal government shutdown, as stated by the U.S. Treasury Department on Tuesday. The report indicates that while tariff revenues hit record levels, the timing of certain benefit payments contributed to the increased deficit.

The shutdown, which lasted for 43 days, delayed various federal payments, including salaries for government employees. This disruption affected the usual reporting schedule for the first month of the 2026 fiscal year. According to a Treasury official, the deficit for October was $27 billion higher, representing a 10% increase from the $257 billion deficit recorded in October 2024. This increase was primarily due to the transfer of approximately $105 billion in benefit outlays, including military and healthcare payments, from November into October.

Adjusting for these changes, the actual deficit for October would have been around $180 billion, which represents a 29% decrease compared to the $252 billion deficit from the same month in the previous year. Total outlays for October, which included the shifted benefit payments, amounted to $689 billion, an increase of 18% from $584 billion in October 2024.

While the Treasury Department has not provided a precise estimate of the financial impact caused by the delayed payments, officials believe the reduction in total outlays due to the shutdown was likely under 5%. Federal law mandates that any unpaid salaries and obligations during government shutdowns must be fully compensated once funding is restored.

In terms of revenue, October’s figures reached a record $404 billion, a 24% increase from $327 billion in October 2024. The surge in revenue was largely driven by net customs duties, which hit a historic monthly high of $31.4 billion, up from $29.7 billion in September and significantly higher than $7.3 billion in October 2024.

Former President Donald Trump commented on the rising tariff revenues, suggesting they would continue to increase as businesses deplete their inventories of imported goods that were acquired before his tariff implementations. His remarks, shared on the social media platform Truth Social, were partly directed at the U.S. Supreme Court, which recently expressed skepticism regarding the legality of tariffs imposed under emergency legislation. Trump stated, “I look so much forward to the United States Supreme Court’s decision on this urgent and time-sensitive matter so that we can continue, in an uninterrupted manner to, MAKE AMERICA GREAT AGAIN!”

In a related development, the Congressional Budget Office recently revised its estimates on the impact of tariffs on the U.S. budget deficit. The agency announced that recent tariff reductions resulting from trade agreements with partner countries have led to a 25% reduction in the projected deficit reduction over the next decade, lowering the expected total from $4 trillion to $3 trillion, including interest costs.

The implications of these financial shifts are significant for the American economy, particularly as the government grapples with the effects of the shutdown and ongoing tariff policies. As the fiscal landscape evolves, monitoring how these changes affect everyday Americans will be crucial.