Budget deficit reaches $606 billion for the year

The nonpartisan Congressional Budget Office on Wednesday estimated the federal budget deficit to be $606 billion through the first 10 months of fiscal 2013.

That represents a decline of $368 billion from last year, when the deficit was already near $1 trillion by the end of July.

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The government is on track to record the lowest deficit of the Obama era and the first annual deficit below $1 trillion. The CBO said that by the time the fiscal year ends Sept. 30, the final deficit should clock in at less than the $642 billion level the CBO forecast in May.

The continued downward path for the deficit has emboldened liberals to call for increased stimulus spending in order to combat unemployment, which stands at 7.4 percent.

Republicans say spending remains too high and can point to the fact most of the deficit reduction comes from higher taxes that they say is hurting growth.  

For the first 10 months of 2013, tax revenue is up 14 percent. Revenue from October through July reached $2.3 trillion, an increase of $278 billion.   

Individual income taxes are up 17 percent in the wake of the New Year’s Eve "fiscal-cliff" deal that allowed Bush-era tax rates to expire for families making more than $450,000 annually.

Payroll taxes are up 11 percent after a temporary 2-percentage point holiday was allowed to expire in January as well. Corporate taxes are up 17 percent as the economic recovery continues.

On the spending side, taking technical shifts into consideration, the cut has been 4 percent or $116 billion.