Did interest payments on the federal debt represent a record share of revenue in FY2025?
This Fact Brief was written by Gabriel Vinocur of EconofactView on Econofact, our Gigafact partner.
Yes.
In fiscal year 2025, 18.5% of the federal government’s revenue went to paying interest on the national debt, a record since the start of the data series in 1940.
The previous high was 18.4% in 1991, which dropped to 6.9% by 2015.
Debt grows when there are deficits: annual shortfalls between revenues and expenditures. The federal government borrows if it runs a deficit. One type of expenditure that contributes to a deficit is interest payments on the amassed debt.
In February 2026, the CBO projected net interest payments will be 37% of total revenue in 2056 if current fiscal policies are kept. Forecasts are tentative given the possibility of unforeseen events. Spending to avert crises, like the $5 trillion COVID-19 stimulus, can further increase the debt, and thus debt interest payments. Meanwhile, technological developments such as artificial intelligence may grow the economy, making it easier to pay the debt.
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Fact Briefs are bite-sized, well-sourced explanations that offer clear "yes" or "no" answers to questions, confusions, and unsupported claims circulating online. They rely on publicly available data and documents, often from the original source. Fact Briefs are written and published by newsrooms in the Gigafact network. Each brief is limited to 150 words or fewer and is not intended to provide an in-depth analysis, but rather to deliver concise, definitive answers grounded in verified information.
Sources
- Peter G. Peterson Foundation Interest Costs on the National Debt Are Reaching All-Time Highs
- Congressional Budget Office Key Budget and Economic Data
- USAspending Federal Response to COVID-19
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