Parliament Passes Ukraine’s 2026 State Budget

On December 3, the Verkhovna Rada approved Ukraine’s 2026 state budget, with 257 in favor, forecasting UAH 4.78 trillion expenditures and a 18.5% GDP deficit.

On December 3, the Verkhovna Rada approved the draft law “On the State Budget for 2026” in its entirety.

This was shown in the live broadcast of the Verkhovna Rada plenary session, reports Economichna Pravda.

The vote in favor was 257 deputies and 37 against.

The budget draft developed by the government provides for revenues of UAH 2.92 trillion and expenditures of UAH 4.78 trillion.

The budget deficit is about UAH 2.4 trillion, or 18.5% of GDP.

There is currently no source to cover a significant part of this deficit, namely about USD 19 billion (approximately UAH 800 billion). Previously, the government hoped that such a source could be a reparations loan from the EU, but the bloc has not yet made a final decision on allocating the funds.

Defense expenditures for 2026 are projected at UAH 2.8 trillion. Nominally, this amount corresponds to the 2025 defense spending at the time the budget draft was submitted to parliament.

However, in the fall, the Rada increased 2025 defense spending by an additional UAH 300 billion, so the actual expenditures planned for 2026 will be lower than this year.

In the 2026 budget, the government provided for an increase in social standards for the first time since 2023:

• Minimum wage – from UAH 8,000 to UAH 8,647 (+8%);

• General subsistence minimum – from UAH 2,920 to UAH 3,209 (+9.9%);

• Subsistence minimum for able-bodied persons – from UAH 3,028 to UAH 3,328 (+9.9%);

• Subsistence minimum for persons who have lost their ability to work – from UAH 2,361 to UAH 2,595 (+9.9%).

In the morning, a meeting of the Verkhovna Rada’s budget committee on the 2026 budget took place. The chair of the Rada’s budget committee, Roksolana Pidlasa, reported that a number of changes had been made to the document.

According to Pidlasa, she insisted on the following amendments to the 2026 budget:

• Allocate an additional 4% of personal income tax (PIT) to local budgets (up to 64%) and earmark these funds for settling energy payments and repaying debts arising from differences in energy tariffs (if applicable);

• Remove the 15.2 billion UAH subsidy for tariff differences to balance the reduced state budget revenues;

• Add 1 billion UAH for the purchase of weapons and military equipment by the Ministry of Defense (to be taken from the “military reserve” program);

• Add 244 million UAH for the needs of the Bureau of Economic Security (from the reserve fund).

“Teacher salaries will still be increased: 30% from January 1 and an additional 20% from September 1, without any changes to the existing approach to teacher pay. At the same time, it is proposed to add 4.8 billion UAH to the program to enhance the prestige of the teaching profession, allowing for the possibility of further salary increases for teachers during the year,” she added.

Before the vote, budget committee chair Roksolana Pidlasa explained the necessity of passing the budget: “If we do not approve this budget, we will not have IMF programs or a reparations loan. And we will not be able to cover the entire deficit.”

However, not all deputies supported the document. For example, deputy Yaroslav Zheleznyak commented on his “No” vote as follows:

• The 2026 budget leaves a 300 billion UAH gap for the army (even compared to this year).

• It also leaves a 180 billion UAH gap in military salaries (again, even compared to this year).

• A deficit of 19 billion USD is planned, with no clear source to cover it.

Previously, he also wrote: “I do not understand how, in the fourth year of a full-scale war, such a gap in army funding can be left. I do not understand how, for the fourth year, there is no attempt to address the minimum salaries of military personnel, leaving a gap of 180 billion UAH. I do not understand how, given this financial situation, funds are still allocated to the ‘marathon,’ ‘cashback,’ the distribution of ‘1,000 UAH,’ strategic communications with 4 billion UAH, roads, and a lot of other populist measures….”