U.S. Federal Government Tax Revenue by Year
U.S. federal tax revenue is made up of the total tax receipts received by the government each year. Most of it is paid either through income taxes or payroll taxes. The rest is made up of estate taxes, excise and customs duties, and interest on the Federal Reserve's holdings of U.S. Treasurys.
Key Takeaways
- The bulk of federal tax revenue comes from income taxes, payroll taxes, and corporate taxes.
- Historically, federal revenues haven't been enough to pay for spending, creating a trillion-dollar budget deficit.
- Tax cuts implemented by Presidents Bush, Obama, and Trump to drive economic growth further reduced revenues.
- Tax revenue has grown steadily since 1962. It eclipsed $1 trillion for the first time in 1990.
The Federal Government's Current Revenue
The U.S. government estimates its total revenue to be $5.49 trillion for fiscal year 2025.
Per the White House's projections, income taxes are slated to contribute $2.6 trillion. Another $2.2 trillion should come from payroll taxes. This includes $1.3 trillion for Social Security, $399 billion for Medicare, and $56 billion for unemployment insurance. Corporate taxes would add another $467 billion.
The remainder of federal revenue comes from excise taxes, tariffs on imports, miscellaneous receipts, and estate taxes.
How Revenue Relates to the Deficit, Debt, and GDP
The government's annual income doesn't cover its spending, which was projected to create a $1.8 trillion budget deficit in 2025. Deficits add to the national debt.
Many argue that Congress should only spend what it earns, but that depends on where the economy is in the business cycle. For example, some argue Congress should use deficit spending to expand economic growth in a recession and stimulus spending to create jobs. Once the recession is over, the government should then switch from expansionary to contractionary fiscal policy because it's the best time to raise taxes and reduce the deficit and national debt. It also keeps the economy from overheating and forming dangerous bubbles.
Note
The government's 2025 tax revenue projection is roughly 18.7% of gross domestic product (GDP), which is a measurement of a nation's economic output.
U.S. Tax Revenue by Year
Here's a record of income for each fiscal year since 1962. Tax receipts fell off during the 2007–2009 recession but started setting new records by fiscal year 2013. They fell off again during the brief 2020 recession and then resumed their upward climb until the fiscal year 2023, when lower income tax collections driven by Trump's tax cuts pushed overall revenue lower.
| Fiscal Year | Revenue |
|---|---|
| FY 2023 | $4.44 trillion |
| FY 2022 | $4.90 trillion |
| FY 2021 | $4.05 trillion |
| FY 2020 | $3.42 trillion |
| FY 2019 | $3.46 trillion |
| FY 2018 | $3.33 trillion |
| FY 2017 | $3.32 trillion |
| FY 2016 | $3.27 trillion |
| FY 2015 | $3.25 trillion |
| FY 2014 | $3.02 trillion |
| FY 2013 | $2.78 trillion |
| FY 2012 | $2.45 trillion |
| FY 2011 | $2.30 trillion |
| FY 2010 | $2.16 trillion |
| FY 2009 | $2.11 trillion |
| FY 2008 | $2.52 trillion |
| FY 2007 | $2.57 trillion |
| FY 2006 | $2.41 trillion |
| FY 2005 | $2.15 trillion |
| FY 2004 | $1.88 trillion |
| FY 2003 | $1.78 trillion |
| FY 2002 | $1.85 trillion |
| FY 2001 | $1.99 trillion |
| FY 2000 | $2.03 trillion |
| FY 1999 | $1.83 trillion |
| FY 1998 | $1.72 trillion |
| FY 1997 | $1.58 trillion |
| FY 1996 | $1.45 trillion |
| FY 1995 | $1.35 trillion |
| FY 1994 | $1.26 trillion |
| FY 1993 | $1.15 trillion |
| FY 1992 | $1.09 trillion |
| FY 1991 | $1.06 trillion |
| FY 1990 | $1.03 trillion |
| FY 1989 | $991.1 billion |
| FY1988 | $909.2 billion |
| FY 1987 | $854.3 billion |
| FY 1986 | $769.2 billion |
| FY 1985 | $734.0 billion |
| FY 1984 | $666.4 billion |
| FY 1983 | $600.6 billion |
| FY 1982 | $617.8 billion |
| FY 1981 | $599.3 billion |
| FY 1980 | $517.1 billion |
| FY 1979 | $463.3 billion |
| FY 1978 | $399.6 billion |
| FY 1977 | $355.6 billion |
| FY 1976 | $298.1 billion |
| FY 1975 | $279.1 billion |
| FY 1974 | $263.2 billion |
| FY 1973 | $230.8 billion |
| FY 1972 | $207.3 billion |
| FY 1971 | $187.1 billion |
| FY 1970 | $192.8 billion |
| FY 1969 | $186.9 billion |
| FY 1968 | $153.0 billion |
| FY 1967 | $148.8 billion |
| FY 1966 | $130.8 billion |
| FY 1965 | $116.8 billion |
| FY 1964 | $112.6 billion |
| FY 1963 | $106.6 billion |
| FY 1962 | $99.7 billion |
Frequently Asked Questions (FAQs)
What is the main source of tax revenue for local governments?
Unlike the federal government, most local governments earn the majority of their revenue from property or sales taxes. Income taxes are significantly less common at the local level.
How does the government raise revenue?
One way for the federal government to increase revenue is to boost taxes. It has several options to do this, though, and economists and policymakers frequently debate the effectiveness of each. Some examples of ways to increase federal tax revenues include directly increasing tax rates, raising rates on wealthier taxpayers, reducing tax exemptions and deductions, and boosting economic activity.
How much are federal taxes?
Federal income taxes are structured in graduated brackets ranging from 10% to 37% of your adjusted gross income. Long-term capital gains are taxed at a different rate, ranging from 0% to 20%.
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