The Ukrainian Parliament has approved a significant amendment to the state budget for 2026, amounting to 1.56 trillion hryvnias. The Cabinet of Ministers prepared the proposal, which received support from 240 lawmakers during the first reading.
Finance Minister Serhiy Marchenko announced that the budget includes a distribution plan for 45 billion euros, which represents half of the 90 billion euros allocated by the European Union to support Ukraine in 2026 and 2027. Of this amount, 31.8 billion euros is earmarked for defense and security, while 13.2 billion euros will go towards budgetary support.
“We are increasing expenditures in this sector by 1 trillion 560 billion hryvnias, with 1 trillion 371 billion hryvnias allocated for weapon development and 174 billion hryvnias for personnel salaries. Additionally, we are establishing a reserve for the defense sector,” Marchenko stated.
The minister noted that the plan includes full allocation of military personal income tax to a special fund dedicated to meeting the needs of the Armed Forces of Ukraine. Furthermore, based on the Ministry of Defense’s recommendations, revenues from import duties on military goods will be directed towards the development of the defense industry and the removal of military products.
Also included in the budget are expenditures for comprehensive regional resilience plans totaling 40 billion hryvnias, alongside an increase of 40 billion hryvnias in the reserve fund to finance unforeseen measures during the state of war, particularly those related to addressing the consequences of Russian aggression.
According to Marchenko, the budget’s funding sources are projected to generate 2 trillion 290 billion hryvnias, primarily from EU contributions and additional revenues under the “Ukraine” plan, amounting to 47.7 billion hryvnias. Expenditures will be reduced by 276 million hryvnias, and the deficit is expected to decrease to 21% of GDP.
The explanatory note accompanying the bill indicates that part of the military income tax will be allocated for rewards for the destruction of Russian drones. Additionally, military levies and export duties on military and dual-use goods entering the special budget fund will be directed to the Ministry of Defense. These funds are intended for the procurement, modernization, and repair of military equipment, the development of the defense industry, new technologies, and the financial support of military personnel.
The Ukrainian Parliament has passed a budget amendment for 2026, focusing on substantial defense funding and support from the EU. The changes aim to bolster military capabilities and address the ongoing challenges posed by Russian aggression.