The U.S. federal budget shortfall for May decreased by $23 billion, or about 7%, to $293 billion, the Treasury Department reported Wednesday. Officials attributed the narrowing primarily to calendar shifts in the timing of certain benefit payments from the prior year.
Total receipts in May were $336 billion, down $36 billion or 10% from May 2025. On the spending side, outlays fell $59 billion, or roughly 9%, to $628 billion compared with the same month the previous year.
Customs activity played an outsized role in the monthly numbers. The Treasury said customs duty refunds amounted to $21.97 billion in May while gross customs collections were $21.93 billion, producing net customs outflows of $42 million for the month.
The net outflows followed a program of refunds tied to tariffs collected under the International Emergency Economic Powers Act. The Treasury said the U.S. Customs and Border Protection agency had begun issuing refunds of about $166 billion in tariffs that the U.S. Supreme Court declared illegal in February. Prior to that ruling, customs duties had become a notable component of monthly Treasury receipts, rising into the low $30 billion range late in the previous year.
When Treasury analysts adjust the figures to account for calendar shifts - specifically, the movement of some payments that occurred in June 2025 into May of that year - the adjusted May deficit of $293 billion is an increase of $71 billion, or 32%, from the prior year. The Treasury emphasized that these timing differences affect year-over-year comparisons.
The department's report highlights two simultaneous influences on the May deficit: a reduction in both receipts and outlays relative to a year earlier, and the impact of large customs duty refunds tied to a court ruling. The adjusted comparison, which accounts for the earlier timing of some payments in the prior year, shows a significantly larger deficit on a like-for-like basis.
Data snapshot
- May deficit: $293 billion, down $23 billion (7%) from prior year.
- Total receipts: $336 billion, down $36 billion (10%).
- Total outlays: $628 billion, down $59 billion (9%).
- Customs duty refunds: $21.97 billion; gross customs collections: $21.93 billion; net customs outflows: $42 million.
- Tariff refunds linked to Supreme Court ruling: approximately $166 billion.