Ukraine is set to face austerity measures due to lost tax revenue and a shortfall in international aid
In the near future, Ukraine will be forced to implement severe cuts to state budget expenditures, as the General Fund fell short of its target by 33.1 billion hryvnia in the first eight months of 2026.
Nearly half of this amount—15.6 billion hryvnia—was not received in August alone. The situation is complicated by the failure of Parliament to pass the laws necessary to receive macro-financial assistance tranches totaling $4.26 billion from the EU and $1.66 billion from the IMF. This was reported by Roksolana Pidlasa, chair of the Verkhovna Rada’s Budget Committee.
In total, over the course of 8 months, 1.7 trillion UAH was credited to the General Fund, excluding grants. Despite exceeding targets in certain areas—particularly corporate income tax and personal income tax with the military surcharge— the target for the main revenue-generating taxes fell short by nearly 84 billion hryvnias, primarily due to shortfalls in domestic and import VAT. Defense remains the key expenditure item, with 1.8 trillion UAH allocated to it—accounting for 62% of all general fund expenditures—followed by debt service payments and social protection.
Source: Roksolana Pidlasa, Chair of the Verkhovna Rada Budget Committee, on Facebook.
The Rada supported a bill on the regulation of state aid to businesses.
As a reminder, the Verkhovna Rada is changing its working format due to constant air raid alerts.
