The U.S. Treasury said on Monday that refunds related to import duties tied to President Donald Trump’s tariffs were a major driver of June’s federal budget outcome, which recorded a $120 billion deficit. That represents a sharp reversal from the $27 billion surplus posted in June 2025, a month that had benefited in part from the imposition of the tariffs.
Gross customs duty collections in June were $23.6 billion, but refunds totaled $49.2 billion, creating a net outflow of $25.6 billion for the month. Overall receipts for June fell by $31 billion, or 6%, to $496 billion compared with the same month a year earlier. At the same time, outlays for June rose to $616 billion, an increase of $117 billion, or 23%, relative to the reported June 2025 total.
The Treasury noted that June 2025 outlays had been reduced by $97 billion because of calendar shifts in benefit payments, a factor the department said affected year-over-year comparisons. On an adjusted basis that accounts for such timing differences, the June deficit widened by $53 billion, or 79%, compared with the prior-year adjusted deficit of $67 billion.
Interest costs contributed materially to the monthly outlay increase. Gross interest payments on public debt in June rose by $41 billion, or 28%, to $185 billion. That increase was partly offset by a $10 billion, or 17%, rise in interest received by federal trust funds, which climbed to $70 billion.
Looking at the fiscal year to date, the Treasury reported the deficit increased by $29 billion, or 2%, bringing the total to $1.367 trillion. Receipts in that period were $4.151 trillion, up $143 billion, or 4%. Outlays totaled $5.518 trillion, up $172 billion, or 3%.
The Treasury's report highlights the impact of large tariff-related refunds, shifts in benefit payment timing, and rising interest expenses on recent monthly and year-to-date budget results.