Russia is planning to significantly boost its defense spending in 2027, allocating 17.1 trillion rubles (approximately $202.6 billion), according to government budget documents. This marks a 27% increase from the initially budgeted 13.5 trillion rubles, positioning it as the highest defense expenditure since the conflict in Ukraine began in 2022.
The proposed spending surge comes amidst a growing budget deficit, with the Russian government revising its 2026 deficit forecast to 3.2% of GDP, up from an earlier 1.6% estimate. Total budget spending is projected to rise to 48.6 trillion rubles this year, with defense remaining a major component of government expenditure.
To address the expanding deficit and escalating expenses, Russia plans to implement additional borrowing and introduce new tax measures. Among these is a proposed windfall tax on metals and mining companies, expected to generate around 200 billion rubles annually.
State debt is anticipated to climb to 21.7% of GDP by 2027 from 19.9% in 2026, with borrowing next year projected to increase to 7.7 trillion rubles. The exact amount of defense spending for 2026 remains classified, with some military-related costs recorded under other budget categories.
The draft budget, which is expected to be submitted to the Russian parliament by October 1, underscores the government’s commitment to maintaining robust defense funding as a priority, despite the broader fiscal challenges it faces.