The U.S. government closed the 2018 fiscal year $779 billion in the red, its highest deficit in six years, as Republican-led tax cuts pinched revenues and expenses rose on a growing national debt, according to data released by the Treasury Department, Reuters reports.
New government spending also expanded the federal deficit for the 12 months through September, the first full annual budget on the watch of U.S. President Donald Trump. It was the largest deficit since 2012.
The data also showed a $119 billion budget surplus in September, which was larger than expected and a record for the month. A senior Treasury official said the monthly surplus was smaller when adjusted for calendar shifts.
Economists generally view the corporate and individual tax cuts passed by the Republican-controlled U.S. Congress late last year and an increase in government spending agreed in early February as likely to balloon the nation’s deficit.
Trump and his fellow Republicans have touted the tax cuts as a boost to growth and jobs.
“America’s booming economy will create increased government revenues – an important step toward long-term fiscal sustainability,” Office of Management and Budget Director Mick Mulvaney said in a statement accompanying the data.
The deficit in the 12 months through September was $113 billion - or 17 percent - bigger than in the same period a year earlier. Adjusting for calendar effects, the gap was even larger, the Treasury official said.