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Automatically translated version. May contain inaccuracies compared to the original.
15 September after 22:00 the government submitted to the Verkhovna Rada the draft Law “On the State Budget of Ukraine for 2027” (No. 16000).
The Cabinet published the basic parameters in a release, and Finance Minister Serhii Marchenko called the draft “complex” while presenting it in the Rada.
The most sensitive details of the document — from the real state of military pay to revenues calculated based on tax changes not yet adopted — are critical. We analyze the main parameters of the budget draft.
What the government submitted and presented
Presenting the state budget draft for 2027 in parliament on 16 September, Finance Minister Serhii Marchenko emphasized that the document was prepared on the assumption of a continuation of the war: “In this budget we assume continuation of the war with the Russian Federation in 2027.”
Finance Minister Serhii Marchenko during his speech from the Verkhovna Rada podium
The draft is built on the government’s macro forecast, which anticipates GDP growth of only 1,3% (1,6% is expected in 2026), a slowdown of inflation to 8% (versus 9,2% this year), and an average annual exchange rate of 47,1 UAH per dollar (44,4 UAH in the 2026 budget).
According to Marchenko, defense needs are already rising: “The Ministry of Defense additionally needs 27 billion US dollars, and that is only until the end of 2026.” At the same time, budget revenues are decreasing due to business disruptions — ongoing shelling, destruction of warehouses and logistics routes, and port blockades. Because of this, Marchenko said tax authority collections are expected to miss targets by 70 billion hryvnias by the end of this year.
The minister named external financing as the key challenge for next year: “For next year we have an uncovered financing need — 32,6 billion US dollars.” He estimated total external financing needs at 52,6 billion dollars, of which sources covering 20 billion are already clear, and negotiations with partners continue regarding the remainder.
Marchenko called the most promising source for covering the deficit work with frozen Russian assets, as well as structuring a new loan mechanism (Revenue Acceleration Loan 2).
Alongside external sources, Marchenko emphasized internal reserves: activating the interagency group on economy de-shadowing involving the tax service, customs and the State Bureau of Economic Security, and implementing EU directives on VAT.
Other basic indicators of the 2027 budget draft:
revenues — 5 trillion 648 billion UAH (+452,1 billion UAH, or +8,7% of the plan for 2026 with changes);
expenditures — 7 trillion 272 billion UAH (+864,9 billion UAH, or +13,5%);
need for international support — 52,6 billion dollars;
local budget resources — 1 trillion 34,5 billion UAH (+123,9 billion UAH, +13,6%).
Defense and security — 4 trillion 885 billion UAH, or 43,8% of GDP (+517,9 billion UAH above current year figures, +11,9%. Nominal GDP-2026 was planned at 10,31 trillion), of which:
2 trillion 298,5 billion UAH — armaments and military equipment (+1,4 billion UAH);
1 trillion 791,7 billion UAH — wages with charges (+337,5 billion UAH);
499,9 billion UAH — other expenditures (+127,7 billion UAH);
264,9 billion UAH — reserve funds (+51,3 billion UAH);
30 billion UAH — state guarantees for armaments and military equipment.
Non-military expenditures:
social funds — 1 trillion 311,4 billion UAH (+218,2 billion UAH), of which the Pension Fund — 1 trillion 278,8 billion UAH;
social payments and measures of the Ministry of Social Policy — 540,3 billion UAH (+72,6 billion UAH), including 292,8 billion UAH — transfer to the Pension Fund of Ukraine for pension supplements;
education — 328,5 billion UAH (+50,8 billion UAH), of which 235,3 billion UAH — salaries for education institution staff; the average monthly salary of an experienced teacher — 27,3 thousand UAH (+65% compared to 2025);
healthcare — 292,5 billion UAH (+35 billion UAH), of which 225 billion UAH — Medical Guarantees Program; salary of a specialist doctor — at least 30 thousand UAH, nurse — 20 thousand UAH;
support for regions and communities — 133,6 billion UAH (+42,2 billion UAH);
public investment projects — 116 billion UAH, of which 76,4 billion UAH — funds from international financial organizations and foreign governments;
support for the economy and business — 96 billion UAH (+45,7 billion UAH);
housing policy — 84,9 billion UAH (+38,3 billion UAH), including 45 billion UAH — “yeOselya”;
support for internally displaced persons — 83,2 billion UAH (+11,6 billion UAH);
veterans’ policy — 20,5 billion UAH (+3 billion UAH);
support for agricultural producers — 7,4 billion UAH;
sports and youth — 6,85 billion UAH;
support for the Plast scouting movement — 61,5 million UAH.
Marchenko called on parliament to work together: “The budget is complex. But together we will find a way to implement it,” he urged from the podium.
4,3 trillion UAH difference that must be covered from abroad
Chair of the Verkhovna Rada Budget Committee Roksolana Pidlasa (Servant of the People), before the draft was presented in the Rada, published an express analysis of the document, naming international aid the most acute issue. She said the uncovered need of 32,6 billion dollars (1,45 trillion hryvnias at this year’s exchange rate) — “is more than social protection, education and healthcare combined.”
She values state budget-2027 expenditures — spending, lending and debt repayment — at over 8 trillion UAH, while the state’s own resources (revenues excluding grants, domestic government bonds and privatization) are 3,7 trillion UAH.
“The difference is 4,3 trillion UAH and it must be covered by international funds,” the Budget Committee chair writes. By her estimate, budget expenditures are more than four times higher than pre-full-scale invasion spending.
According to her calculations, security and defense make up 66,8% of all budget expenditures. At the same time, 35,7% of this resource, or 1,73 trillion UAH, are EU funds for the purchase of weapons and equipment, which are recorded in a special fund but may be provided not only in cash.
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The mechanism was explained in her Telegram channel by Olha Vasylevska-Smahliuk (Servant of the People), a member of the Verkhovna Rada Committee on Finance, Tax and Customs Policy: partners can purchase and transfer weapons and equipment to Ukraine themselves, and their value will be reflected in the budget.
They counted revenues based on laws not yet adopted
According to Pidlasa, growth of own revenues by 265,9 billion UAH in 2027, compared to 2026, is expected by the government primarily from three tax receipts. The largest increases come from VAT (+167,2 billion UAH), PIT (+106 billion UAH) and excises (+48,7 billion UAH).
But during debate in the Rada the committee chair said that “the project does not mention additional taxation of individual entrepreneurs. The government is not laying that in.”
Borrowing through domestic government bonds (OVDP) is planned at 544,4 billion UAH — almost 125 billion UAH more than in 2026. For comparison Pidlasa cites this year’s figures: in 8 months OVDP financing directed 332 billion UAH to the budget against a plan of 235 billion UAH.
She separately warns about revenues included only if the Rada adopts certain measures: more than 131 billion UAH of planned receipts will materialize only if parliament amends the Tax Code. In particular, VAT would be increased by 1 percentage points and fuel excises by 4 percentage points.
“I personally assess such changes as unlikely,” writes the Budget Committee chair.
A branch of PrivatBank
Another 52,5 billion UAH could be obtained if the Rada extends the bank profit tax at 50% and the president signs the law on taxation of digital platforms. Nearly 12 billion UAH in receipts were expected from the parcel law in 2027.
However, the Rada voted on parcel taxation from abroad only in first reading before the budget was presented. The bill amends the Tax Code and proposes to introduce VAT on goods purchased through foreign marketplaces: for online purchases worth up to 150 euros VAT would be calculated and paid by the electronic platform, and noncommercial parcels worth up to 45 euros are proposed to remain VAT-exempt. If the law is adopted in full — together with accompanying changes to the Customs Code — they would take effect only from 1 July 2027.
The government draft indeed states that 58,7 billion UAH for insuring business against wartime risks could be financed by raising the standard VAT rate from 20% to 21%, and that 8,3 billion UAH for protecting the fuel sector could come from a possible increase in fuel excise.
Separate laws would need to be adopted for this.
First Deputy Chair of the Verkhovna Rada Committee on Finance, Tax and Customs Policy Yaroslav Zhelezniak (Holos) wrote on his Telegram channel: “So the VAT increase is already written into the budget — they just haven’t voted for it yet.” He also said that revenues include 64,9 billion UAH from “de-shadowing customs” — but only if customs overperforms its plan.
Military salaries: increases only on paper
Zhelezniak drew attention to another key problem.
“In the draft budget for next year, the Program for Maintaining the Armed Forces of Ukraine, where military pay ‘sits’ — 1,02 trillion UAH, — supposedly includes as much as +173,5 billion (or +20,5%) above the current 2026 budget. But don’t rush to rejoice... The fact is that today, already in 2026, there is a shortfall of around 100–190 billion UAH in that very line,” the MP wrote on his Telegram channel.
Therefore, Zhelezniak emphasizes, the amount budgeted for military salaries for 2027 will be the same as this year. “And that in turn means the government does not plan any salary increases for the military. Again. For the fifth year in a row.”
During the presentation MPs from various factions and groups asked Marchenko about increases in military pay. He assured them the government was working to ensure defenders’ pay “is fair,” but gave no specifics.
For comparison, Zhelezniak cites planned pay increases for other structures: wages for the State Bureau of Investigation will increase by 19,9%, prosecutors by 12,2%, the judges’ payroll fund will rise by 44%, and the total public sector payroll fund — by 18,2%.
“Marathon, ‘Tysiachevesna’ they haven’t forgotten either... Only about the military there is silence. And that is the greatest disgrace of Zelensky’s budget policy,” emphasized MP Zhelezniak.
Vasylevska-Smahliuk clarifies that 1,02 trillion UAH is “the total payroll fund for military personnel and civilian employees of the Armed Forces of Ukraine.” Zhelezniak adds: the biggest actual pay increases budgeted here are for the HUR (+30,0%), the National Guard (+27,8%) and border guards (+22,0%).
A new measure noted by both Zhelezniak and Vasylevska-Smahliuk: in 2027 the entire military levy is proposed to be credited to the special fund and directed exclusively to military pay for the whole year, rather than from 1 July as in 2026.
Communities lose 4% of PIT
“In 2025–2026 communities received 64% of PIT instead of the base 60% — the additional 4% was left ‘for the heating season’: payments for electricity, heat, gas. In the 2027 draft this provision is absent,” Zhelezniak wrote.
By his calculation, these 4% amount to about 27 billion UAH, which will additionally move from local budgets to the state.
At the same time it is provided that 60 billion UAH for “Comprehensive Regional Resilience Plans” will be distributed by the Cabinet. “So money is automatically taken from communities and returned by government decision,” the MP noted.
Road repair in the Sumy region.
Innovations: road fund, “forfeiture fund” and Kyiv’s debt
Pidlasa highlights five further principal provisions of the draft.
First — partial restoration of Road Fund financing at 52,8 billion UAH: 34,2 billion UAH for public roads, 10,1 billion UAH for debt repayment and 8,5 billion UAH to communities — for local public roads and local streets.
Zhelezniak clarifies: since 2022 all “road” taxes — fuel and car excises, customs duties — have gone to the general fund for defense, and the Budget Declaration for 2027 planned the same. In the draft budget they propose to direct 75% to the general fund and 25% to the special fund. The Agency for Restoration’s program thus rises to 34,9 billion UAH versus 12,9 billion UAH in 2026, i.e., by 2,7 times.
“So road repairs in 2027 — for the first time since the start of the large-scale war — are again financed from a dedicated source. The question is whether the general fund can withstand this, given it already has less revenue than last year,” Zhelezniak asks.
Other new provisions: balances of the Unemployment Insurance Fund (5 billion UAH) will go only to pensions, whereas in previous years these funds were used for cashback and other business support programs. The government also wants to decide by itself how to spend the fund for liquidation of the consequences of armed aggression.
And another fundamental point — the city of Kyiv is proposed to be obliged to repay the debt to the state as of 2015. Then, by the Kyiv Council decision of 17 December 2015 No. 26/26, Kyiv’s eurobonds were exchanged for state bonds as part of an overall restructuring: obligations to external creditors moved to the state budget, and Kyiv remained indebted to the state. In the 2027 draft the government proposes to return 332 million UAH, Pidlasa writes.
Debate about the marathon
“I always like to evaluate each of Zelensky’s next-year budget drafts by a very simple question: did they keep the marathon there or not?” Zhelezniak wrote. (He means the telemarathon “United News” — a nationwide informational marathon launched on 24 February 2022 with the start of the full-scale Russian invasion to inform the public in real time. Content producers are private media groups and TV channels, including “1+1 Media”, “Starlight Media”, “Inter Media Group”, “My — Ukraine” — Editor.)
He says that financing of the telemarathon “United News” effectively remains. The only change is that “it moved from the Ministry of Culture to the Cabinet: 1,6 billion UAH (+4%), and the ‘Tysiachevesna’ program — ‘information security, national identity, heroization’ — receives +1,4 billion UAH, i.e., 5,4 billion UAH for 2027.”
Vasylevska-Smahliuk disagrees with that interpretation: “The ‘betrayal’ has already started on Telegram channels claiming that the telemarathon was supposedly allocated 1,62 billion UAH in the draft budget. And that is not true.”
She says the same line provides funding for state foreign broadcasting and the state information agency Ukrinform, and that “hardly more than half of this amount” goes to the marathon — in 2025 and 2026 years less than half of this program’s funding was allocated to the telemarathon.
She describes the same 5,4 billion UAH program as a comprehensive Ministry of Culture program that combines information security, national identity formation, heroization and the production and distribution of patriotic audiovisual content. Separately, she says 3,05 billion UAH is allocated for Public Broadcasting.
The President’s Office, cashbacks and the dollar exchange rate
The draft proposes increasing spending on ensuring the president and the President’s Office to 1 072,8 million UAH, i.e., by 194,9 million or 22,2%, Zhelezniak reported, comparing this to the minimum wage increase. From 1 January 2027 it will rise from 8 647 UAH to 9 546 UAH — that is +899 UAH, or only +10,4%.
MP Yaroslav Zhelezniak
At the same time, funds for “National Cashback” are not included in the draft.
Funding for elections is not provided in the Central Election Commission’s budget. The CEC receives 365,1 million UAH (+90,0 million UAH, +32,7%) for “leadership and management.”
The price of war and revenue shortfalls. What next?
Member of the Verkhovna Rada Committee on National Security, Defense and Intelligence Oleksandr Fediienko (Servant of the People) predicts that some non-military programs in 2027 will have to be underfunded or postponed.
Fediienko recalled the Budget Committee’s estimates: one day of war costs Ukraine about 190 million dollars versus 140 million in 2024.
After the draft budget presentation for 2027 in the Rada, MP Artur Herasymov (European Solidarity) demanded a vote to reject it. However only 7 MPs voted for that proposal in an almost empty chamber.
First Vice-Speaker Oleksandr Korniienko reported that the draft was taken into account and that MPs can submit their amendments until 1 October. Then the Budget Committee will prepare the draft for first reading — which is expected at the end of October.
Document: PDF proof of the original version of the news item "Уряд подав до Ради складний проєкт бюджету-2027 зверстаний під продовження війни". It records the publication content at the moment of the first scan, the preservation date and the source: LB.ua.
