Ukraine has exhausted options to increase defense spending, partners’ support needed – Pidlasa
Ukraine has already reached the limit of increasing its own budget revenues used to finance defense needs.
This was stated by Roksolana Pidlasa, head of the parliamentary Budget Committee from Servant of the People, in the EP Chronicles of the Economy podcast.
"None of our partners allow the use of funds (financial assistance provided – ed.) for defense. We can only rely on our own revenues and domestic borrowing. That is why we allocate to the security and defense sector exactly what we can earn ourselves," the MP reminded.
She noted that opportunities to attract additional funds for financing the Defense Forces in the domestic market have also been exhausted.
"As for domestic borrowing, we have been saying for a year and a half that the government bond instrument has run its course. Net issuance next year will be negative: we will redeem government bonds worth 100 billion hryvnias more than we borrow," Pidlasa explained.
Thus, according to her, the government is limited in its ability to increase military spending, particularly to raise service members’ pay, as the economy simply cannot generate the necessary level of tax revenues.
Pidlasa also emphasized that both the government and the president have stated that the state will not raise taxes, while the volume of potential additional revenues from de-shadowing remains limited.
"The question remains about the use of funds from international partners. If they allow them to be used for defense needs, then we will be able to increase defense spending more significantly. For now, we are limited to our own resources and, frankly, we have already reached the limit of our capabilities," the head of the Budget Committee stated.
As reported, on 15 September, the Cabinet of Ministers approved the draft law "On the State Budget of Ukraine for 2026 " and submitted it to the Verkhovna Rada.
Total state budget expenditures are set at 4.8 trillion hryvnias (+415 billion compared to 2025), with revenues at 2.83 trillion hryvnias (+446.8 billion or 18.8%), the deficit capped at 18.4% of GDP (-3.9 percentage points from 2025), and external financing needs at 2.08 trillion hryvnias.
At the same time, expenditures on the Defence Forces in 2026 are planned at UAH 2.8 trillion (+UAH 168.6 billion by 2025). The largest share of defence budget expenditures will traditionally be allocated to the Ministry of Defence - UAH 1.92 trillion, but this is only UAH 11 billion more than currently envisaged for 2025.
