The US budget deficit grew to $666 billion in fiscal year 2017, according to official data released Friday, with much of the increase associated with spending on an ageing population.
It represented a 13.6 percent year-on rise. The deficit now accounts for 3.5 percent of gross domestic product, up from 3.2 percent in 2016.
"Growth in spending outpaced growth in tax receipts for the second year in a row as a result of historically subpar economic growth," a Treasury Department statement said.
But the overall deficit was $80 billion lower than forecast.
"Today's budget results underscore the importance of achieving robust and sustained economic growth. Through a combination of tax reform and regulatory relief, this country can return to higher levels of GDP growth, helping to erase our fiscal deficit," said Treasury Secretary Steven Mnuchin.
"These numbers should serve as a smoke alarm for Washington, a reminder that we need to grow our economy again and get our fiscal house in order. We can do that through smart spending restraint, tax reform, and cutting red tape," added Mick Mulvaney, director of the office of management and budget.
The statement added that higher outlays for social security, government medical programs for the elderly, low-income and disabled as well as interest on the public debt all contributed to the rise.
"Higher spending by the Federal Emergency Management Administration for hurricane relief and recovery also contributed to the increase," it added.