The US Department of the Treasury announced on Thursday (September 11) that the federal budget deficit in August decreased by $35 billion compared to the same period last year, reaching $345 billion, a 9% decrease. This improvement was mainly attributed to President Trump’s tariff policies, which increased customs net revenues by approximately $22.5 billion in August.
According to Reuters, overall government revenue in August increased by $38 billion to $344 billion, a 12% increase, while expenditures increased by $2 billion to $689 billion. Both revenue and expenditures hit record highs in that month, resulting in a deficit of $345 billion.
Driven by Trump’s tariff measures, customs net revenue in August also reached a monthly record of $29.5 billion, significantly higher than the $7 billion for the same period last year.
For the first eleven months of the 2025 fiscal year, tariff revenue totaled $172 billion. Treasury Secretary Scott Bessent stated during a cabinet meeting in August that he expects tariff revenue to continue growing monthly through the end of the year.
Customs tariffs ranked as the third largest revenue source in August. Net customs tariff revenue has increased by $95 billion this fiscal year, reaching a record $165.2 billion.
Despite the slight decrease in the federal budget deficit in August, the deficit for the 2025 fiscal year through August remains as high as $1.973 trillion. A US Treasury official declined to predict whether the deficit for the entire fiscal year ending on September 30 will exceed $2 trillion but noted that September revenues are usually higher than those in August.
Total revenue for the first eleven months of the 2025 fiscal year increased by $300 billion, a 7% rise, reaching a record $4.691 trillion, while expenditures increased by $376 billion, a 6% growth, reaching a record $6.664 trillion.
At the end of August, a federal appeals court ruled Trump’s tariffs unlawful. The ruling is set to take effect on October 14, and the Trump administration has filed an appeal with the Supreme Court. Secretary Bessent mentioned in an interview with NBC’s “Meet the Press” that if the Supreme Court upholds the lower court’s decision on Trump’s tariff measures, the Treasury Department will have to refund approximately half of the tariffs collected, which will severely impact federal finances.
However, Bessent expressed in an interview with Reuters that he believes the Supreme Court will support the legality of President Trump’s tariffs.