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WASHINGTON (Thomson Financial) - The Bush administration's new budget plan anticipates a budget deficit that is nearly double from last year's estimate, and a deficit in the current fiscal year that is more than 50 pct higher than what was expected last summer.

"The primary reason for increasing deficits in the near term is the President's economic growth package and an expected slowing of receipt growth, due to an expected reduction in corporate tax receipts from recent high levels," the administration said in its budget plan released today. "Another reason for increases in the projected near-term deficits is increasing defense and emergency spending."

For fiscal year 2009, which starts this October, the White House expects a 407 bln usd budget deficit, up from the 213 bln usd it anticipated in July. But the White House indicated that this 2009 deficit could go even higher, depending on the need for new funds for anti-terrorism efforts around the world.

"Actual funding needs for 2009 and beyond will be determined by security conditions in Iraq and Afghanistan, and will continue to be evaluated," the White House said in its budget plan.

For fiscal year 2008, which ends this September, the White House expects a 410 bln usd budget deficit, up sharply from the 258 bln usd deficit it saw last July.

The budget plan sees 3.11 trln usd in spending in fiscal year 2009, the first time the federal budget will have exceeded 3 trln usd. It also sees 2.93 trln usd in spending for the current fiscal year, up 200 bln usd from fiscal year 2007 at a time when it sees federal receipts shrinking by 47 bln usd.

The plan takes into account the roughly 150 bln usd in costs for the economic stimulus package that is close to being approved by Congress, and anticipates that the Bush tax cuts -- soon to expire -- will be made permanent. It also proposes that Americans can invest in their own retirement accounts starting in 2013.

"Taken together, the President's policies are expected to lead to fiscal improvements," the budget said.

But in the meantime, the budget expects larger deficits in the near-term. After fiscal year 2009, the budget sees a 160 bln usd deficit in 2010, and a 95 bln usd deficit in 2011. Together, that's 43 bln usd higher than what was seen last summer.

The budget does not see a return to surpluses until 2012.

The White House also cut back its estimate of the strength of the US economy, as it now expects 2.7 pct GDP growth in 2008. That's down from the 3.0 pct it saw last summer.

It also sees GDP growth of 3.0 pct in 2009, down from the 3.1 pct growth it saw last year.