Ukrainian lawmakers approve record defence budget increase

Ukrainian lawmakers on Wednesday approved changes to the 2026 budget, paving the way for record defence spending as the country steps up its strikes deep inside Russia while having some success in small counterattacks on the front line.

The updated budget provides for an additional 1.56 trillion hryvnias ($34.7 billion) for defence and security.
The bill was passed by 242 lawmakers, with 226 needed for ⁠a majority.

The increased funding became possible after the €90 billion European Union loan backed by frozen Russian assets was unlocked.

The loan will give Ukraine's finances a much-needed boost, with €3.2 billion expected to be distributed this month, but Kyiv still relies on other international aid to cover its budgetary needs and to fund the war.

Ukraine's overall defence spending is set to rise to a record 4.37 trillion hryvnias ($97.2 ⁠billion) this year, up from a previously forecast $64 billion. Defence spending last year was about $61.4 billion.

On Tuesday, members of the parliament also adopted a law introducing a tax on income earned through online platforms, including ⁠Uber, Uklon or Bolt. The bill is one of the International Monetary Fund's (IMF) requirements, as Ukraine's critical donor is pressing for an expansion of ⁠the fiscal base to support the country's war-torn economy.

Some of the other requirements to unlock the next IMF tranche for Kyiv, ⁠including a parcels tax and a tax for small businesses, have been challenged by lawmakers in recent months.

-Reuters