WASHINGTON — The federal budget deficit, helped by a revenue bonanza, shrank by 33% in the budget year that ended Sept. 30 even though the U.S. government spent $1 trillion for the first time in history, the Reagan Administration reported Wednesday.
The Administration's final accounting for the last budget year showed the imbalance between revenues and spending fell to $148 billion, down from the record $221.1 billion in the 1986 fiscal year.
The improvement came in a 12-month period in which the government spent a record $1.002 trillion, up 1.2% from fiscal 1986, when federal spending was $990.2 billion.
Revenues climbed at a much faster pace than spending, rising by 11.1% to total $854.1 billion. The increase was due in large part to higher-than-expected individual tax payments resulting from the changeover to the new tax law.