Government Receipts and Expenditures
Third Quarter of 2022
Net government saving, the difference between current receipts and current expenditures in the federal government and state and local governments, was −$1,117.8 billion in the third quarter of 2022, decreasing $200.0 billion from −$917.8 billion in the second quarter of 2022 (charts 1 and 2 and table 1).
“Net lending or net borrowing (−)” is an alternative measure of the government fiscal position. Net borrowing is the financing requirement of the government sector, and it is derived as net government saving plus the consumption of fixed capital and net capital transfers received less gross investment and net purchases of nonproduced assets.
Net borrowing was $1,212.5 billion in the third quarter, increasing $284.0 billion from $928.5 billion in the second quarter (charts 3 and 4 and table 1).
| Line | Level | Change from preceding quarter | ||||
|---|---|---|---|---|---|---|
| 2022 | 2021 | 2022 | ||||
| Q3 | Q4 | Q1 | Q2 | Q3 | ||
| 1 | Current receipts | 7,589.5 | 242.0 | 497.0 | 77.1 | −28.6 |
| 2 | Current expenditures | 8,707.3 | −438.5 | −130.5 | 133.2 | 171.5 |
| 3 | Net government saving | −1,117.8 | 680.6 | 627.5 | −56.2 | −200.0 |
| 4 | Federal | −1,037.7 | 790.4 | 595.0 | 49.1 | −157.8 |
| 5 | State and local | −80.0 | −109.8 | 32.5 | −105.3 | −42.1 |
| 6 | Net lending or net borrowing (−) | −1,212.5 | 667.5 | 967.0 | −257.0 | −284.0 |
| 7 | Federal | −1,149.0 | 785.3 | 926.6 | −626.9 | 172.2 |
| 8 | State and local | −63.5 | −117.8 | 40.4 | 369.9 | −456.2 |
Net federal government saving was −$1,037.7 billion in the third quarter, decreasing $157.8 billion from −$879.9 billion in the second quarter (table 2). In the third quarter, current receipts turned down and current expenditures accelerated relative to the second quarter.
Federal government net borrowing was $1,149.0 billion in the third quarter, decreasing $172.2 billion from $1,321.2 billion in the second quarter.
- Personal current taxes (line 3) accelerated in the third quarter, increasing $35.8 billion after increasing $34.5 billion in the second quarter, reflecting an acceleration in withheld taxes. The acceleration in withheld taxes reflects the pattern of wages. The acceleration was partially offset by a deceleration in nonwithheld taxes.
- Taxes on production and imports (line 4) turned down in the third quarter. Customs duties turned down in the third quarter, decreasing $6.9 billion after increasing $4.7 billion in the second quarter, primarily reflecting a deceleration in the volume of imports. Excise taxes decelerated, increasing $0.3 billion after increasing $2.3 billion in the second quarter, reflecting a larger decrease in gasoline taxes and a deceleration in air transport taxes.
- Taxes on corporate income (line 5) turned down in the third quarter, reflecting a downturn in corporate profits.
- Contributions for government social insurance (line 7) accelerated in the third quarter, increasing $26.0 billion after increasing $19.7 billion in the second quarter, reflecting the pattern of wages.
- Income receipts on assets (line 8) decreased more in the third quarter, reflecting a larger decrease in dividends from Federal Reserve banks. The larger decrease was slightly offset by an upturn in interest receipts, reflecting an upturn in interest received from the rest of the world.
- Current transfer receipts (line 9) turned down in the third quarter, reflecting downturns in current transfer receipts from business and current transfer receipts from the rest of the world. The downturn in current transfer receipts from business reflects a decrease in settlements; second-quarter receipts were boosted by a $2.3 billion ($9.2 billion at an annual rate) settlement with Allianz Global Investors for committing securities fraud. The downturn in current transfer receipts from the rest of the world reflects a decrease in fines paid by foreign businesses.
- Consumption expenditures (line 12) accelerated, increasing $29.9 billion in the third quarter after increasing $4.8 billion in the second quarter, reflecting an upturn in nondefense consumption expenditures that was partially offset by a deceleration in national defense consumption expenditures. The upturn in nondefense consumption expenditures reflects a downturn in sales to other sectors, specifically a decrease in Strategic Petroleum Reserve sales. The deceleration in national defense consumption expenditures reflects a deceleration in spending for defense services.
- Government social benefits to persons (line 17) decreased less in the third quarter, decreasing $6.4 billion after decreasing $16.5 billion in the second quarter. The smaller decrease in the third quarter reflects smaller decreases in Supplemental Nutrition Assistance Program benefits and unemployment benefits. Medicare benefits accelerated in the third quarter, increasing $8.5 billion after increasing $3.8 billion.
- Grants-in-aid to state and local governments (line 20) turned down in the third quarter, reflecting downturns in education grants and welfare and social services grants. The downturn in education grants reflects decreased funding for the Education Stabilization Fund. The downturns were partially offset by an upturn in Medicaid grants.
- Other current transfer payments to the rest of the world (line 21) accelerated, reflecting an acceleration in grants to the rest of the world, specifically U.S. Agency for International Development grants to provide support to Ukraine for global health programs and for migration and refugee assistance.
- Interest payments (line 22) accelerated in the third quarter, reflecting accelerations in interest paid to persons and business and interest paid to the rest of the world. The acceleration in interest paid to persons and business reflects an increase in interest paid on treasury bills and notes in the third quarter.
- Subsidies (line 23) decreased less in the third quarter, decreasing $9.1 billion after decreasing $21.6 billion in the second quarter, following the conclusion of funding in the second quarter for pandemic-related emergency grants to closed entertainment venues.
- Capital transfer payments (line 33) turned down in the third quarter, reflecting a decrease in capital grants for the Coronavirus State and Local Fiscal Recovery Funds program authorized by the American Rescue Plan Act to help state and local governments support their response to and recovery from the COVID–19 pandemic.
- Net purchases of nonproduced assets (line 34) turned down in the third quarter, reflecting receipts from a Federal Communications Commission spectrum auction of rights to broadcast at certain frequencies. Net purchases had increased in the second quarter, reflecting the competitive sale of leases for the right to build offshore wind energy generators.
| Line | Level | Change from preceding quarter | |||||
|---|---|---|---|---|---|---|---|
| 2022 | 2021 | 2022 | |||||
| Q3 | Q4 | Q1 | Q2 | Q3 | |||
| 1 | Current receipts | 5,025.7 | 161.0 | 406.8 | 92.7 | −29.6 | |
| 2 | Current tax receipts | 3,212.7 | 114.4 | 354.6 | 82.7 | 16.1 | |
| 3 | Personal current taxes | 2,634.4 | 76.4 | 328.9 | 34.5 | 35.8 | |
| 4 | Taxes on production and imports | 202.8 | 10.8 | 14.8 | 7.0 | −6.6 | |
| 5 | Taxes on corporate income | 340.6 | 26.4 | 9.0 | 39.4 | −12.6 | |
| 6 | Taxes from the rest of the world | 34.9 | 0.9 | 1.9 | 1.7 | −0.4 | |
| 7 | Contributions for government social insurance | 1,662.8 | 41.8 | 39.0 | 19.7 | 26.0 | |
| 8 | Income receipts on assets | 93.1 | 4.6 | 18.8 | −18.7 | −57.9 | |
| 9 | Current transfer receipts | 62.5 | 1.0 | −2.6 | 12.1 | −13.3 | |
| 10 | Current surplus of government enterprises | −5.3 | −0.8 | −3.0 | −3.1 | −0.4 | |
| 11 | Current expenditures | 6,063.5 | −629.4 | −188.2 | 43.6 | 128.3 | |
| 12 | Consumption expenditures | 1,278.2 | 13.1 | −0.2 | 4.8 | 29.9 | |
| 13 | National defense | 743.1 | −4.0 | −1.9 | 18.1 | 16.6 | |
| 14 | Nondefense | 535.1 | 17.1 | 1.8 | −13.4 | 13.3 | |
| 15 | Current transfer payments | 3,934.7 | −392.8 | −47.0 | 15.3 | 19.1 | |
| 16 | Government social benefits | 2,869.4 | −210.6 | −73.1 | −16.2 | −5.6 | |
| 17 | To persons | 2,840.1 | −208.9 | −74.4 | −16.5 | −6.4 | |
| 18 | To the rest of the world | 29.4 | −1.6 | 1.2 | 0.4 | 0.8 | |
| 19 | Other current transfer payments | 1,065.3 | −182.2 | 26.1 | 31.4 | 24.8 | |
| 20 | Grants-in-aid to state and local governments | 953.4 | −160.3 | 15.3 | 20.5 | −7.1 | |
| 21 | To the rest of the world | 111.9 | −21.9 | 10.7 | 11.0 | 31.9 | |
| 22 | Interest payments | 736.8 | 7.5 | 2.9 | 45.2 | 88.3 | |
| 23 | Subsidies | 113.8 | −257.3 | −143.8 | −21.6 | −9.1 | |
| 24 | Net federal government saving | −1,037.7 | 790.4 | 595.0 | 49.1 | −157.8 | |
| 25 | Social insurance funds | −471.6 | 238.9 | −25.7 | 16.9 | 11.8 | |
| 26 | Other | −566.1 | 551.4 | 620.6 | 32.4 | −169.7 | |
| Addenda: | |||||||
| 27 | Total receipts | 5,058.2 | 162.5 | 407.5 | 92.8 | −28.0 | |
| 28 | Current receipts | 5,025.7 | 161.0 | 406.8 | 92.7 | −29.6 | |
| 29 | Capital transfer receipts | 32.4 | 1.6 | 0.7 | 0.1 | 1.5 | |
| 30 | Total expenditures | 6,207.1 | −622.7 | −519.1 | 719.7 | −200.3 | |
| 31 | Current expenditures | 6,063.5 | −629.4 | −188.2 | 43.6 | 128.3 | |
| 32 | Gross government investment | 378.9 | 4.1 | 0.5 | 4.8 | 4.5 | |
| 33 | Capital transfer payments | 206.4 | −9.3 | 0.0 | 371.6 | −254.3 | |
| 34 | Net purchases of nonproduced assets | −90.5 | 18.0 | −324.3 | 307.0 | −73.2 | |
| 35 | Less: Consumption of fixed capital | 351.1 | 6.1 | 7.1 | 7.3 | 5.5 | |
| 36 | Net lending or net borrowing (−) | −1,149.0 | 785.3 | 926.6 | −626.9 | 172.2 | |
Net state and local government saving was −$80.0 billion in the third quarter, decreasing $42.1 billion from −$37.9 billion in the second quarter. In the third quarter, current receipts turned down and current expenditures decelerated relative to the second quarter (table 3).
In the third quarter, net borrowing was $63.5 billion, an increase of $456.2 billion; in the second quarter, net lending was $392.7 billion.
- Personal current taxes (line 3) decelerated in the third quarter, reflecting a deceleration in personal income taxes.
- Taxes on production and imports (line 4) decelerated in the third quarter, reflecting a deceleration in state severance taxes and a larger decrease in other taxes on products. Excise taxes turned up, reflecting an upturn in state public utility taxes.
- Income receipts on assets (line 7) accelerated in the third quarter, reflecting an acceleration in interest receipts.
- Federal grants-in-aid (line 9) turned down in the third quarter, reflecting downturns in education grants and welfare and social services grants. The downturn in education grants reflects decreased funding for the Education Stabilization Fund. The downturns were partially offset by an upturn in Medicaid grants.
- Other current transfer receipts (line 10) turned down in the third quarter, decreasing $9.3 billion after increasing $14.9 billion. Third-quarter receipts reflect a $0.5 billion ($1.98 billion at an annual rate) fine paid to the New York state government by U.S. affiliates of Credit Suisse to settle a case related to mortgage-linked investments in the United States. Second-quarter receipts were boosted by a $3.2 billion ($12.8 billion at an annual rate) settlement with Allianz Global Investors, which included restitution payments to public pension funds.
- Current surplus of government enterprises (line 11) decreased more in the third quarter, reflecting a downturn in federal subsidies to mass transit enterprises.
- Consumption expenditures (line 13) decelerated in the third quarter, reflecting a decrease in spending for intermediate goods and services, specifically petroleum products.
- Government social benefits (line 14) decelerated in the third quarter, reflecting a downturn in Medicaid benefits. The deceleration was partially offset by an acceleration in other social benefits, reflecting an increase in state stimulus payments to individuals. More information can be found in the FAQ “How are state refundable tax credits recorded in the National Income and Product Accounts (NIPAs)?”.
- Capital transfer receipts (line 22) turned down in the third quarter, reflecting a downturn in capital grants for the Coronavirus State and Local Fiscal Recovery Funds program provided to help state and local governments support their response to and recovery from the COVID–19 pandemic. Second-quarter capital transfers were also boosted by a $25.9 billion ($103.6 billion at an annual rate) settlement between major drug distributors, including Johnson & Johnson, and the states to assist states affected by the opioid epidemic.
| Line | Level | Change from preceding quarter | ||||
|---|---|---|---|---|---|---|
| 2022 | 2021 | 2022 | ||||
| Q3 | Q4 | Q1 | Q2 | Q3 | ||
| 1 | Current receipts | 3,517.2 | −79.2 | 105.4 | 4.9 | −6.1 |
| 2 | Current tax receipts | 2,277.8 | 75.0 | 87.9 | −29.2 | 12.1 |
| 3 | Personal current taxes | 594.8 | 36.4 | 10.5 | 8.5 | 5.0 |
| 4 | Taxes on production and imports | 1,582.3 | 22.5 | 22.0 | 18.4 | 16.2 |
| 5 | Taxes on corporate income | 100.7 | 16.1 | 55.4 | −56.1 | −9.1 |
| 6 | Contributions for government social insurance | 23.9 | 0.2 | 0.0 | 0.2 | 0.3 |
| 7 | Income receipts on assets | 109.2 | 0.7 | 0.5 | 0.3 | 0.8 |
| 8 | Current transfer receipts | 1,107.3 | −158.5 | 17.9 | 35.4 | −16.4 |
| 9 | Federal grants-in-aid | 953.4 | −160.3 | 15.3 | 20.5 | −7.1 |
| 10 | Other | 153.9 | 1.9 | 2.6 | 14.9 | −9.3 |
| 11 | Current surplus of government enterprises | −1.1 | 3.3 | −0.8 | −1.8 | −3.0 |
| 12 | Current expenditures | 3,597.2 | 30.6 | 73.0 | 110.1 | 36.0 |
| 13 | Consumption expenditures | 2,346.0 | 37.6 | 58.4 | 87.1 | 20.4 |
| 14 | Government social benefits | 982.9 | −2.9 | 19.5 | 28.0 | 20.2 |
| 15 | Interest payments | 267.6 | −4.1 | −4.9 | −5.0 | −4.6 |
| 16 | Subsidies | 0.7 | 0.0 | 0.0 | 0.0 | 0.0 |
| 17 | Net state and local government saving | −80.0 | −109.8 | 32.5 | −105.3 | −42.1 |
| 18 | Social insurance funds | 5.6 | −0.1 | −0.6 | −0.2 | 0.3 |
| 19 | Other | −85.6 | −109.7 | 33.0 | −105.0 | −42.4 |
| Addenda: | ||||||
| 20 | Total receipts | 3,676.0 | −88.9 | 105.2 | 472.3 | −394.4 |
| 21 | Current receipts | 3,517.2 | −79.2 | 105.4 | 4.9 | −6.1 |
| 22 | Capital transfer receipts | 158.9 | −9.7 | −0.2 | 467.4 | −388.2 |
| 23 | Total expenditures | 3,739.5 | 28.9 | 64.8 | 102.4 | 61.8 |
| 24 | Current expenditures | 3,597.2 | 30.6 | 73.0 | 110.1 | 36.0 |
| 25 | Gross government investment | 490.0 | 8.7 | 5.9 | 4.8 | 25.5 |
| 26 | Capital transfer payments | |||||
| 27 | Net purchases of nonproduced assets | 17.6 | 0.1 | 0.2 | 0.2 | 0.0 |
| 28 | Less: Consumption of fixed capital | 375.3 | 10.5 | 14.4 | 12.6 | 9.8 |
| 29 | Net lending or net borrowing (−) | −63.5 | −117.8 | 40.4 | 369.9 | −456.2 |
