Russia plans to spend 17.1 trillion roubles, or $202.6 billion, on defense in 2027, according to government documents seen by Reuters on Monday. The planned outlay is roughly 27% higher than the amount originally budgeted for that year.

The original 2027 defense allocation stood at 13.5 trillion roubles, or $159.8 billion. The revised figure would be Russia’s highest annual defense spending level since the war in Ukraine began in 2022.

The increase forms part of a much larger military bill covering the next three years. According to the documents, total defense spending during that period will reach 50 trillion roubles, or $591.7 billion.

That three year total shows the scale of spending built into the government’s budget plans. It also comes as other figures in the documents point to a wider deficit, increased borrowing, higher state debt, and reduced oil and gas revenue expectations.

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For 2026, the government had planned to spend 12.1 trillion roubles on defense. The actual amount is classified, however, and will not be disclosed, leaving the publicly available figure short of a complete accounting.

The documents also noted that some military spending can be recorded in other sections of the budget. As a result, the stated defense allocation does not necessarily contain every military related expense being carried elsewhere in government accounts.

At the same time, the government raised its estimate for the 2026 budget deficit to 3.2% of gross domestic product. Its previous estimate had placed that deficit at 1.6% of GDP.

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Overall budget spending in 2026 is now expected to rise by 13.2% to 48.6 trillion roubles. That level of spending would be equal to 20.9% of GDP, according to the government documents reviewed by Reuters.

The government is expected to submit its draft budget to parliament by Oct. 1. The spending plan will therefore move forward alongside the sharper defense allocation, widening deficit estimate, and additional financing measures detailed in the documents.

Last week, the government announced plans for new tax increases in 2027 to help finance the growing deficit. Those proposed increases add another source of revenue to the mix as military spending and borrowing requirements rise.

Image Credit: DoW

One of those measures is a new windfall tax targeting metals and mining companies. The documents showed that the tax is expected to generate about 200 billion roubles, or $2.4 billion, each year.

Borrowing is also set to climb. In 2026, the government will increase its net borrowing plan by 26% to 5 trillion roubles, adding more debt financing as it seeks to cover the budget gap.

The government also plans to spend 459 billion roubles from the liquid portion of its National Wealth Fund to reduce the deficit. That amount represents about 11% of the fund’s liquid part, according to the documents.

Meanwhile, the government lowered its estimate for oil and gas revenue in 2026. The revised forecast stands at 7.6 trillion roubles, down from the previous estimate of 8.9 trillion roubles.

Image Credit: DoW

State debt is projected to rise from 19.9% of GDP in 2026 to 21.7% in 2027. The 2027 level would move above the 20% threshold that Russian authorities regard as safe, according to the documents.

Total borrowing in 2027 is expected to increase by 43% to 7.7 trillion roubles. Together, the figures describe a budget plan featuring record defense spending since the Ukraine war began, higher taxes, heavier borrowing, fund withdrawals, and a larger projected debt burden.

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