Russia is preparing to significantly boost its defense spending in the coming years, with plans to allocate 17.1 trillion rubles (approximately $202.6 billion) for defense in 2027. This figure represents a 27% increase over the initially budgeted 13.5 trillion rubles and would mark the highest defense expenditure since the conflict in Ukraine began in 2022.
Over the next three years, Russia’s total defense spending is projected to reach 50 trillion rubles. However, specific figures for 2026 remain classified, with some military expenses potentially categorized under different budget sections. This increase in defense allocation comes amid a widening budget deficit in Russia. The government has revised its 2026 deficit forecast to 3.2% of GDP, up from an earlier estimate of 1.6%, while total budget spending for the current year is expected to rise to 48.6 trillion rubles.
To address the growing deficit and support increased spending, the Russian government plans to implement additional borrowing and introduce new tax measures. One such measure is a proposed windfall tax on metals and mining companies, which is anticipated to generate around 200 billion rubles annually.
As part of these fiscal adjustments, Russia’s state debt is projected to climb to 21.7% of GDP by 2027, compared to 19.9% in 2026. Additionally, the government expects total borrowing next year to increase to 7.7 trillion rubles.
The draft budget, which includes these defense spending plans, is slated for submission to Russia’s parliament by October 1. Defense spending remains a key component of the government’s expenditure strategy, reflecting ongoing priorities in the face of economic challenges and geopolitical tensions.