Aug 28, 2025
For the first time since the invasion of Ukraine, funding for the army and weapons purchases “ate up” every second ruble collected from taxpayers in the federal budget.
The share of war spending in treasury revenues in the first quarter of 2025 was 50.1%, and at the end of the second – 48.2%, according to calculations by Janis Kluge, a research fellow at the German Institute for International Security Studies, based on data from the Electronic Budget system.
The burden of war is becoming increasingly heavy for the treasury: in 2022, the military machine burned 24.4% of taxes received by the budget; in 2023 – 32.05%, in 2024 – 39.05%. The previous record was recorded in the first quarter of 2023 – 45.4%.
The share of military items in budget expenditures is lower, since the expenditures themselves exceed revenues, and the budget is in deficit. Thus, in January-June, the Ministry of Finance collected 17.584 trillion rubles and spent 21.278 trillion.
Of this amount, 39.9% went to the war, and in the first quarter – 41.2%. These figures are absolute records in the modern history of Russia and exceed even the levels of the last years of the Soviet Union, when the collapse of the socialist economy forced the CPSU to put the gigantic military-industrial complex “under the knife”.
Thus, in the 1990 budget, 71 billion rubles out of 241.3 billion, or 29.4%, were allocated for “military purposes”.
According to Kluge’s calculations, the Kremlin spent 8.484 trillion rubles on defense items in January-June. Compared with the same period last year, spending on the army and weapons production increased by 31%; compared with January-June 2023 – by 95%, and compared with the first year of the war – three times.
The 2025 budget law initially included 13.5 trillion rubles under the “national defense” item and another 3.459 trillion rubles under the “national security” item, which includes the budgets of the police, the Russian National Guard, the Investigative Committee and the special services. Instead, about 8% of GDP was planned, but in fact it will be even more, a government source told Reuters
in August. The Kremlin does not plan to cut the military budget in 2026 even if the active phase of military operations in Ukraine ends, the agency’s source said: “We will still need to make shells and drones, although on a slightly smaller scale. The confrontation will continue, the army and weapons costs will be higher, because the West is also increasing them.”
According to the source, if the war ends, the defense budget may decrease from 2027, but a reduction to the levels that were “before the SVO” is not expected.
“These figures are absolute records in the modern history of Russia and exceed even the levels of the last years of the Soviet Union, when the collapse of the socialist economy forced the CPSU to put the gigantic military-industrial complex “under the knife”.”
With a decrease of taxes, it’s natural that more percentage must be extracted to cover the costs. What makes it worse is that the decrease in taxes will increase, while the money used to pay for the war is simply being burned without delivering any sort of value.
I’m sure that Kyiv will oblige to help by causing more money-making refineries to go up in smoke.