US budget deficit falls to 8-year low in 2015

Sheets of one dollar bills run through the printing press at the Bureau of Engraving and Printing on March 24, 2015 in Washington, DC (AFP Photo/Mark Wilson) (Getty/AFP/File)

Washington (AFP) - The US government's budget deficit fell to an eight-year low in fiscal 2015, dropping to $439 billion, the Treasury Department announced Thursday.

The cut in the finance gap -- which was $1.4 trillion in 2009 -- brought the deficit down to 2.5 percent of gross domestic product, the lowest level since 2007.

The achievement marked a long effort by the administration of President Barack Obama to pare back the budget shortfall after it soared when the economy plunged into crisis in 2008.

A combination of the fall in revenues and an increase in government spending to shore up the economy and rescue the financial and auto industries had sent the deficit skyrocketing.

The figure for 2015, the fiscal year which ended September 30, was down $44 million from 2014, despite a five percent rise in spending to $3.7 trillion.

That was helped by an 11.0 percent rise in individual income-tax receipts, and a 7.2 percent rise in corporate tax revenues.

"President Obama's agenda continues to put Federal finances on a sustainable footing while laying the foundation for durable economic growth and broadly shared prosperity," Treasury Secretary Jacob Lew said in a statement.

"Under the president's leadership, the deficit has been cut by roughly three-quarters as a share of the economy since 2009 –- the fastest sustained deficit reduction since just after World War II."

The 2015 deficit could prove to be the smallest for some time. The projected deficit for the fiscal year 2016 just begun is projected to rise to $455 billion, and to continue to rise for several years at least as both the economy and budget grow.

The 2016 budget "supports the president's ambitious vision for supporting growth and opportunity, and does so while meeting a key test of fiscal stability: holding deficits to below three percent of GDP and stabilizing debt as a share of the economy," the Treasury said.