Fact Check: Did interest payments on the federal debt represent a record share of revenue in FY2025?
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 must borrow 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 always 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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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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