The federal government spent $779 billion more than it took in during the 2018 fiscal year, the highest deficit since 2012, according to Treasury Department data released Monday.

The deficit rose 17 percent from the previous year, fueled by the 2017 GOP tax cuts and a bipartisan agreement to increase spending. Treasury projected that the deficit will surpass $1 trillion in fiscal 2019, which began Oct. 1.

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Overall receipts were similar to the previous year, up 0.5 percent despite a booming economy and a low unemployment rate. Outlays, however, rose six times faster, surpassing $4.1 trillion.

Earlier this month, the nonpartisan Congressional Budget Office issued a similar deficit figure of $782 billion.

"The President’s Budget has provided multiple avenues for Congress to tackle reckless Washington spending with aggressive proposals that reduced deficits by $3.6 trillion over 10 years," according to a document released Monday by the Treasury. "The Administration will work with Members of Congress on a renewed focus to reduce the deficit and get our fiscal house back in order."

“Going forward the President’s economic policies that have stimulated strong economic growth, combined with proposals to cut wasteful spending, will lead America toward a sustainable financial path,” Mnuchin said.

Mulvaney said the uptick in economic growth would help tackle deficits, a frequent argument made by the administration.

“The President is very much aware of the realities presented by our national debt," he said. "America’s booming economy will create increased government revenues — an important step toward long-term fiscal sustainability."

Budget watchers warn that the increasing deficits and debt set up negative economic consequences for the coming years.

"It’s an unsustainable fiscal course that will lead us to debt overtaking the size of the entire economy in as soon as a decade, and not long after topping all-time highs as a share of the economy not seen since World War II," said Maya MacGuineas, president of the Committee for a Responsible Federal Budget, a budget watchdog.

The increasing debt level alongside with increasing interest rates have led to a spike in interest payments, the cost of servicing the debt.

"Interest on the debt rose by $62 billion over the previous year to $325 billion, which amounts to twice as much as we spend on the Departments of Transportation and Homeland Security combined," MacGuineas added. "Under current projections, annual interest payments on the debt could top $1 trillion by 2030."

“Over the course of the next year, new spending priorities will dig the hole deeper,” said William Hoagland, senior vice president at the Bipartisan Policy Center. “Damage from unforeseen natural disasters such as hurricanes will also require federal assistance and add to the growing deficit."

Updated at 4:38 p.m.