Budget Deficit Set to Rise Again, CBO Says

The federal budget deficit—currently at $439 billion—is likely to rise in 2016 for the first time since 2009, the nonpartisan Congressional Budget Office reported on Tuesday.

In a preview of a longer budgetary outlook set for release Jan. 25, CBO estimated the 2016 deficit would increase to $544 billion, presaging more dramatic growth in the next decade. “If current laws generally remained unchanged, the deficit would grow over the next 10 years, and by 2026 it would be considerably larger than its average over the past 50 years,” CBO projected. “Debt held by the public would also grow significantly from its already high level.”

The expected rise in 2016, the agency said, “is largely attributable to legislation enacted since August—in particular, the retroactive extension of a number of provisions that reduce corporate and individual income taxes.”

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