Federal Deficit Hit $5.8 Billion In July
Posted October 2, 2009 1:36 pm.
This article is more than 5 years old.
The Finance Department says the federal deficit in July was $5.8 billion, compared with a $2.2 billion surplus in July 2008.
It says the deficit for the first four months of the fiscal year was $18.3 billion, compared with a surplus of $2.9 billion a year earlier.
The department says tax revenues dropped by $3.4 billion in July because of the faltering economy, higher unemployment and some tax breaks.
Spending was up $5.1 billion from the previous year, with the auto sector bailout and higher EI payments making up most of the increase.
But interest payments fell by $400 million, because of lower rates.
For the first four months of the year, personal income-tax revenues were off $2.2 billion, compared with 2008, because of higher unemployment and increases in personal tax exemptions.
The take from corporate taxes fell $4 billion and GST revenues dropped by $2.3 billion as consumers tightened spending.
The department forecasts, however, that GST revenue will strengthen later this year.
Spending in the first four months was up $13.6 billion, mainly because of the auto bailout and higher EI payments.
