An Update to the Budget Outlook: 2023 to 2033

The Congressional Budget Office regularly publishes reports that present projections of what the federal budget would look like in the current year and over the next 10 years if existing laws governing taxes and spending generally remained unchanged. Those baseline projections are developed in accordance with procedures set in law that require the agency to project spending, revenues, deficits, and debt without regard to the statutory limit on federal borrowing known as the debt ceiling.

This report updates CBO’s budget projections released in February 2023. The updates to the projections of outlays reflect numerous technical changes, including those that take into account new information released with the President’s annual budget request and other information available as of March 30, 2023. Updates to projections of revenues are more limited: A comprehensive revision of revenue projections is typically based on an updated economic forecast; the projections in this report are based on the economic forecast the agency published in February.

The Budget in 2023. CBO’s current projections show a federal budget deficit of $1.5 trillion for 2023—which is $0.1 trillion more than the agency estimated in February. The estimate of the 2023 deficit is subject to considerable uncertainty, which has grown more apparent since late March, when the updated projections were finalized. Since that time, CBO has learned that revenue collections through April were less than the agency expected, which could affect total revenues for fiscal year 2023 (which ends on September 30, 2023). Outlays also could differ significantly from CBO’s projections, most notably depending on the outcome of a case currently before the Supreme Court regarding the cancellation of outstanding student loan debt.

The Budget From 2024 to 2033. In the agency’s updated projections, annual deficits nearly double over the next decade, reaching $2.7 trillion in 2033. (Deficits have been adjusted to exclude the effects of shifts that occur in the timing of certain payments when October 1, the first day of the fiscal year, falls on a weekend.) The projected cumulative deficit over the 2024–2033 period—$20.2 trillion—is about the same as the shortfall CBO projected in February. Measured in relation to the size of the economy, deficits grow from 6.0 percent of gross domestic product (GDP) next year to 6.9 percent in 2033—well above their 50-year average of 3.6 percent of GDP.

As a result of those deficits, debt held by the public also increases in CBO’s projections, from 98 percent of GDP at the end of this year to 119 percent at the end of 2033. At that time, debt measured as a share of GDP would reach the highest level ever recorded in the United States and would be on track to rise even further.