Summary

Financial Operations

On the unified budget basis the deficit for fiscal 1972 was $23.2 billion. Net receipts for fiscal 1972 amounted to $208.6 billion ($20.3 billion over 1971) and outlays totaled $231.9 billion ($20.5 billion over 1971).

Borrowing from the public amounted to $19.4 billion. Increases in deposit fund and other liabilities of $5.3 billion, decreases in cash and monetary assets of $2.5 billion, increases in seigniorage of $0.6 billion, increment on gold of $0.9 billion, and decreases in all other financing of $0.5 billion provided the rest of the financing for the $23.2 billion deficit. As of June 30, 1972, Federal securities outstanding totaled $438 billion, comprised of $427 billion in public debt securities and $11 billion in agency securities. Of the $438 billion, $324 billion represented borrowing from the public. The Government's fiscal operations in fiscal years 1971-72 are summarized as follows:

Borrowing from the public-increase, or decrease

Reduction of cash and monetary assets-increase (−), or

decrease...

Other means.

Total budget financing.

*Less than $50 million.

NOTE: The expenditure and loan account distinction for budgetary results was discontinued with final figures for June 30, 1972.

470-716 0-72- -3

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Total receipts rose sharply in fiscal 1972, reaching $208.6 billion, an increase over fiscal 1971 of $20.3 billion or over 10 percent. The rise was in part occasioned by rising incomes but also was bolstered by a substantial bunching of receipts in 1972 caused by a new withholding system for individuals. The increase was dampened by declines in excise taxes and miscellaneous receipts.

A comparison of net budget receipts by major sources for fiscal 1971 and 1972 is shown below.

years

Projected estimates of receipts, required of the Secretary of the Treasury, are shown and explained in the President's budget.

Individual income taxes.-Individual income taxes amounted to $94.7 billion in fiscal 1972, $8.5 billion above the 1971 figure. The in

crease is attributable to rising incomes but is also due in substantial measure to failure of individual taxpayers to adjust to the new withholding system early in calendar year 1972. As a result, overwithholding against wages and salaries in the first six months of calendar year 1972 has swollen fiscal year 1972 receipts. Payments in excess of liabilities will not be refunded until after tax returns are filed in 1973. Corporation income taxes.-Corporation income taxes increased substantially in fiscal 1972, totaling $32.2 billion or $5.4 billion above the figure for 1971. The rise reflected a sharp rise in profits from the low level of 1970, offset in part by the 1971 legislation permitting a new investment credit. In addition, corporation income taxes were also affected by a bunching of receipts in fiscal 1972.

Employment taxes.-Employment taxes totaled $46.1 billion in fiscal 1972, $4.4 billion above such receipts in 1971. The rise reflected expanding payrolls and number of people employed, as well as the effect of an increase in the social security wage base effective January 1, 1972.

Unemployment insurance.—Receipts from unemployment insurance amounted to $4.4 billion in fiscal 1972, $0.7 billion above the 1971 figure.

Contributions for other insurance and retirement.-Such contributions and premiums amounted to $3.4 billion in fiscal 1972, $0.2 billion above receipts in fiscal 1971. These receipts are mainly composed of medical insurance premiums for the aged, and Federal employees retirement deductions. Receipts from each increased in fiscal 1972. Excise taxes.-Excise tax receipts are detailed in the following table.

Excise taxes dropped from $16.6 billion in fiscal 1971 to $15.5 billion in fiscal 1972. The decrease in fiscal 1972 is wholly due to the termination in 1971 of the automobile and truck excises within the manu

facturers excise taxes category. Other excises showed significant rises, notably the alcohol, tobacco, and miscellaneous categories.

Estate and gift taxes.-Estate and gift tax receipts amounted to $5.4 billion in fiscal 1972, an increase of $1.7 billion. The bulk of this increase is due to an administrative speedup of collections.

Customs. Customs duties reached $3.3 billion in fiscal 1972, an advance of $0.7 billion. The normal increase in these taxes was substantially enlarged by an import surcharge which has been discontinued.

Miscellaneous receipts.-Miscellaneous receipts amounted to $3.6 billion in fiscal 1972, falling $0.2 billion from the 1971 level. The decrease was due to lower deposits of earnings by Federal Reserve banks.

Outlays

Total outlays in fiscal 1972 were $231.9 billion (compared with $211.4 billion for 1971). Outlays for fiscal 1972, by major agency, are compared to those of 1971 in the following table. For details see the Statistical Appendix.

On June 30, 1972, cash and monetary assets amounted to $17,546 million, an increase of $2,470 million over fiscal 1971. The balance consisted of $11,310 million in the general account of the Treasurer of the United States ($1,193 million more than June 30, 1971); $5,721 million with other Government officers ($2,059 million more than 1971); and $516 million with the International Monetary Fund ($988 million less than 1971). For a discussion of the assets and liabilities in the Treasurer's general account see page 115. The transactions affecting the account in fiscal 1972 follow: