Budget Deficit Hits $666-Billion

Budget Deficit Hits $666-Billion

It was the biggest shortfall since 2013 and the sixth-highest on record.

The deficit now accounts for 3.5 per cent of gross domestic product, up from 3.2 per cent a year ago.

"Growth in spending outpaced growth in tax receipts for the second year in a row as a result of historically subpar economic growth", the Treasury Department said in releasing the figures.

Spending grew 3.3 per cent to US$3.98 trillion, while revenue fell 0.9 per cent to US$3.32 trillion, as the total federal debt rose to US$14.67 trillion. The government's fiscal year runs from October through September. Higher spending by the Federal Emergency Management Administration for hurricane relief also boosted overall outlays. That tracks with an estimate from the Congressional Budget Office, which had predicted a $668 billion deficit for the last fiscal year. Tax receipts were partially offset by lower deposits of earnings by the Federal Reserve, Treasury said.

The Senate approved a resolution on Thursday night that could speed tax cuts of up to $1.5 trillion through Congress. The national debt, meanwhile, has exceeded $20 trillion. President Donald Trump and his GOP allies on Capitol Hill hope the tax measure will spark a burst of economic growth - and pay big political dividends for the party.