Tariff Shortfall Pushes 2026 Deficit to $2.1 Trillion

A Congressional Budget Office forecast shows the 2026 federal deficit rising to about $2.1 trillion, roughly $200 billion above February’s estimate, largely due to weaker tariff revenue after the Supreme Court struck down Trump-era tariffs. Tariff and customs receipts are now expected about $250 billion below earlier projections, with about $100 billion of collected tariff duties already refunded. In the first 10 months of fiscal 2026 the deficit was $1.8 trillion as outlays grew $308 billion and revenues rose $139 billion, aided by a July payment shift; spending on Social Security, Medicare and Medicaid accounted for most of the increase, and net interest payments rose by $117 billion, prompting economists to warn that borrowing could exceed $2 trillion this year.