The U.S. Congressional Budget Office on Wednesday raised its forecast for the U.S. fiscal deficit this year, but said it would still be much lower than last year’s.

The CBO also reiterated its medium-term view that the U.S. deficit would begin accelerating at the end of this decade, gaining size in real terms and as a percentage of gross domestic product.

The agency’s new estimate for the deficit for the year ending Sept. 30 is $506 billion on a $3.5 trillion budget, slightly higher than the $492 billion in its April estimate.

The CBO said lower-than-expected tax payments by businesses forced it to cut its forecast for total government receipts. (AFP)