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Financial Report of the United States Government

Financial Statements of the United States Government for the Fiscal Years Ended September 30, 2018, and 2017

Statements of Long-Term Fiscal Projections

The Statements of Long-Term Fiscal Projections are intended to assist readers of the government’s financial statements in assessing the financial condition of the federal government and how the government’s financial condition has changed (improved or deteriorated) during the year and may change in the future. They are also intended to assist readers in assessing whether future budgetary resources of the government will likely be sufficient to sustain public services and to meet obligations as they come due, assuming that current policy for federal government public services and taxation is continued without change.

The Statements of Long-Term Fiscal Projections display the present value of 75-year projections by major category of the federal government’s receipts and non-interest spending. These projections show the extent to which future receipts of the government exceed or fall short of the government’s non-interest spending. The projections are presented both in terms of present value dollars and in terms of present value dollars as a percent of present value GDP. The projections are on the basis of policies currently in place and are neither forecasts nor predictions. These projections are consistent with the projections for Social Security and Medicare presented in the Statements of Social Insurance and are based on the same economic and demographic assumptions as underlie the Statements of Social Insurance. These statements also display the fiscal gap, which is a summary measure of the change in receipts or non-interest spending necessary to hold the ratio of debt held by the public to GDP at the end of the projection period to its value at the beginning of the period. Note 23—Long-Term Fiscal Projections, further explains the methods used to prepare these projections and provides additional information. Unaudited required supplementary information further assesses the sustainability of current fiscal policy and provides results based on alternative assumptions to those used in the basic statement.

As discussed further in Note 23, a sustainable policy is one where the debt-to-GDP ratio is stable or declining over the long term. GDP measures the size of the nation’s economy in terms of the total value of all final goods and services that are produced in a year. Considering financial results relative to GDP is a useful indicator of the economy’s capacity to sustain the government’s many programs.

United States Government
Statements of Long-Term Fiscal Projections (Note 23)
Present Value of 75 Year Projections as of September 30, 2018 and 20171

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In trillions of dollars Percent of GDP 2
2018 2017 Change 2018 2017 Change
Receipts:
Social Security Payroll Taxes 60.6 58.0 2.6 4.3 4.3 -
Medicare Payroll Taxes 20.3 19.4 0.9 1.4 1.4 -
Individual Income Taxes 143.8 141.9 1.9 10.2 10.5 (0.3)
Corporate income taxes 18.8 -3 -3 1.3 -3 -3
Other Receipts3 18.5 49.0 (11.7) 1.3 3.6 (1.0)
Total Receipts 262.0 268.4 (6.4) 18.6 19.9 (1.3)
 
Non-interest Spending:
Social Security 82.5 78.7 3.9 5.9 5.8 -
Medicare Part A 4 29.1 26.6 2.5 2.1 2.0 0.1
Medicare Parts B & D 5 35.7 32.3 3.4 2.5 2.4 0.1
Medicaid 34.1 32.1 2.0 2.4 2.4 -
Other Mandatory 41.0 40.5 0.4 2.9 3.0 (0.1)
Defense Discretionary 42.9 39.1 3.8 3.0 2.9 0.1
Non-defense Discretionary 42.9 35.3 7.6 3.1 2.6 0.4
Total Non-interest Spending 308.2 284.6 23.6 21.9 21.1 0.8
 
Receipts less non-interest spending (46.2) (16.2) (30.0) (3.3) (1.2) (2.1)
 
Fiscal Gap 6       (4.1) (2.0) (2.1)

1 75-year present value projections for 2018 are as of 9/30/2018 for fiscal years 2019-2093; projections for 2017 are as of 9/30/2017 for fiscal years 2018-2092.

2 The 75-year present value of nominal Gross Domestic Product (GDP), which drives the calculations above is $1,406.3 trillion starting in fiscal year 2019, and was $1,347.0 trillion starting in fiscal year 2018.

3 In fiscal year 2017, Corporate Income Taxes were included as part of Other Receipts. To incorporate the effects of the Tax Cuts and Jobs Act of 2017, Corporate Income Taxes are modeled separately in fiscal year 2018. Directly comparable data are not available for fiscal year 2017. The $11.7 trillion decrease in Other Receipts is the total of 2018 Corporate Income Taxes ($18.8 trillion) and Other Receipts ($18.5 trillion) less the 2017 Other Receipts ($49.0 trillion).

4 Represents portions of Medicare supported by payroll taxes.

5 Represents portions of Medicare supported by general revenues. Consistent with the President's Budget, outlays for Parts B & D are presented net of premiums.

6 To prevent the debt-to-GDP ratio from rising over the next 75 years, a combination of non-interest spending reductions and receipts increases that amounts to 4.1 percent of GDP on average is needed (2.0 percent of GDP on average in 2017). See Note 23 — Long-Term Fiscal Projections.

Totals may not equal the sum of components due to rounding.

The accompanying notes are an integral part of these financial statements.

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Last modified 04/06/23