The 2027 budget deficit will reach UAH 1.6 trillion: what will change for business

The Cabinet of Ministers has submitted to the Verkhovna Rada the draft state budget of Ukraine for 2027 with a deficit of UAH 1.6 trillion. At the same time, business is facing new risks due to a possible increase in the tax burden, the consequences of Russian attacks on industry, and problems with financing certain sectors.

The draft state budget No. 16000 envisages revenues at the level of UAH 5.65 trillion, while expenditures should amount to UAH 7.27 trillion. The deficit is estimated at UAH 1.6 trillion, or 15% of GDP.

UAH 4.9 trillion is planned to be allocated to security and defense. The government also forecast real GDP growth of 1.3% and an exchange rate of UAH 48 per dollar by the end of 2027.

VAT may increase to 21%

Among the envisaged changes is a possible increase in VAT from 20% to 21%, as well as excise duty on fuel. Additional revenues are planned to be directed, in particular, to the war risk insurance fund.

A business contribution of 2% of the value of insured assets is also envisaged.

The distribution of personal income tax may also change: it is proposed to return the basic model of 60%/25% instead of 64%, which was in effect in 2025–2026. According to the estimates, local budgets may lose about UAH 27 billion compared to 2026.

There is still a lack of more than $32 billion for external financing

International partners have already confirmed support for $20 billion, but the sources of another $32.6 billion of the necessary financing remain uncertain.

At the same time, Ukraine continues to fulfill the conditions of international partners. The material notes that five of the 12 requirements for the second tranche have been met, and among the unmet ones is the introduction of VAT on parcels worth up to EUR 150.

Attacks create new risks for industry

An additional challenge for the economy remains Russian attacks on Ukrainian enterprises. Due to shelling, Zaporizhstal and Kametstal have stopped production, and mining and processing plants in Kryvyi Rih are operating at about half capacity.

Metinvest Group is preparing to declare force majeure under contracts. According to the data provided, production costs have increased by 30% over the year. This creates risks of disruptions in product supplies, staff reductions and reduced tax revenues in industrial regions.

There are also problems in the agricultural sector. Due to the blockade of ports, a deficit of elevator capacities of 8–11 million tons of the new harvest is predicted in November. The government is preparing preferential loans, insurance support and a pause in inspections for farmers.

Thus, 2027 may bring businesses tax changes, new requirements for war risk insurance, and additional challenges related to war losses and government funding deficits.