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CBO: U.S. budget deficit to balloon on Republican tax cuts, economic growth projected higher than initially expected

Senate Majority Leader Mitch McConnell, R-Ky., before the service for the late Rev. Billy Graham in the U.S. Capitol Rotunda in Washington on Feb. 28, 2018. CREDIT: Bloomberg photo by Andrew Harrer.
Senate Majority Leader Mitch McConnell, R-Ky., before the service for the late Rev. Billy Graham in the U.S. Capitol Rotunda in Washington on Feb. 28, 2018. CREDIT: Bloomberg photo by Andrew Harrer.

WASHINGTON — The U.S. budget deficit will balloon over the next few years mainly because of deep tax cuts approved in December by Republicans in the U.S. Congress and President Donald Trump, the nonpartisan Congressional Budget Office said on Monday.

Despite stronger-than-predicted economic growth ahead, the CBO said the deficit will grow to $804 billion in fiscal 2018, which ends on Sept. 30, up from $665 billion in fiscal 2017. The deficit is how much Washington’s spending exceeds its revenues.

CBO forecast 3.3 percent growth in 2018 in gross domestic product, a broad measure of the economy, and 2.4 percent GDP growth in 2019.

In the next few years, deficits will “grow substantially” before stabilizing in 2023, resulting in a projected cumulative deficit of $11.7 trillion for 2018-2027, the CBO said. (Reporting by Amanda Becker; Editing by Makini Brice and Kevin Drawbaugh)

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