In the first quarter of 2025, defense spending reached 73.5% of the state budget

Accounting Chamber of Ukraine made public Conclusion on the implementation of the state budget for the first quarter of 2025. State budget expenditures in the first quarter of 2025 amounted to UAH 1.2 trillion — this is 38.5% more than in the same period of 2024. The main reason for the increase was the increase in expenditures on the defense capability and security of the state, which reached 73.5% of the total amount of expenditures.
According to the results of the analysis of the implementation of the Law on the State Budget of Ukraine for 2025 in the first quarter, the Accounting Chamber noted risks that could negatively affect economic indicators. Among them, the decrease in the revenue part of local budgets and social insurance funds due to the reduction in the number of registered FOPs, currency and financial instability and increased inflationary pressure.
The head of the Accounting Chamber, Olha Pishchanska, presenting the Conclusion during the meeting on June 10, noted that the implementation of the state budget in the first quarter of 2025, as in previous periods, was complicated by the consequences of the war: the limitation of logistical capabilities, population migration, destroyed energy and other infrastructure.
In January-March, the real GDP amounted to only 0.5% with the projected growth for 2025 — 2.7%, which creates a risk of not receiving the planned revenues. One of the main factors that restrained GDP growth was the decrease in exports by 8.7%. First of all, the export of food products and raw materials for their production, as well as iron ore, decreased due to the low harvests of grain last year and the decrease in world prices for iron ore.
At the same time, the presence of Ukrainian goods of the chemical industry, wood and its products, machine building and other products with high added value on foreign markets has increased. The share of such products in exports has currently increased to 15.2%.
Loans and grants from international partners helped to maintain financial stability and fill the state budget. The share of external revenues increased from 9% to 27%, although this is 23% less than planned for January-March 2025. In particular, UAH 19.4 billion of EU aid under the Ukraine Facility program, which the state received in April, did not arrive.
State budget revenues in the first quarter of 2025 amounted to UAH 926.2 billion, which is UAH 284.1 billion (44.3%) more than in the same period of 2024. The growth is caused by a 2.2-fold increase in the volume of own revenues of budgetary institutions, in particular those belonging to the sphere of management of the Ministry of Defense of Ukraine. Own revenues accounted for almost a third of budget revenues, while the share of tax revenues decreased by 10 percentage points.
Taxpayers’ debt to the state budget has decreased by 12% since the beginning of the year as a result of its removal from the records due to court appeals and cancellation of the decisions of the DPS regarding its calculation. Previously, the Accounting Chamber drew attention to the need to improve the quality of the control and verification work of the State Tax Service of Ukraine in the corresponding audit report.