Russia plans to increase defense spending by 27% in 2027 — Daily Maverick

Russia, as an aggressor state, plans to allocate 17.1 trillion rubles to defense in 2027. This is approximately 27% more than the initially budgeted 13.5 trillion rubles and is the highest figure since the start of Russia’s war against Ukraine in 2022. Daily Maverick reports, citing government documents reviewed by Reuters.

Defense spending for three years

According to the documents, total defense spending over the next three years will amount to 50 trillion rubles. For 2026, the Russian government planned to allocate 12.1 trillion rubles to defense, but the actual amount is classified and will not be disclosed. Some military expenditures may also be accounted for in other sections of the budget.

The estimate for Russia’s budget deficit in 2026 was raised from 1.6% to 3.2% of GDP. Total budget expenditures in 2026 are expected to increase by 13.2%, to 48.6 trillion rubles, or 20.9% of GDP. The Russian government expects to submit the draft budget to parliament by October 1.

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Borrowing and taxes

To finance the deficit, Russian authorities also announced plans to raise taxes in 2027. A new tax on windfall profits of metallurgical and mining companies is expected to generate around 200 billion rubles annually.

In 2026, Russia plans to increase net borrowing by 26%, to 5 trillion rubles, and also use 459 billion rubles, or about 11% of the liquid portion of the National Wealth Fund, to reduce the deficit. The forecast for oil and gas revenues in 2026 was lowered from 8.9 trillion to 7.6 trillion rubles. According to the documents, public debt in 2027 could rise to 21.7% of GDP, compared with 19.9% in 2026, while total borrowing could increase by 43%, to 7.7 trillion rubles.