Budget 2025: Where the government suggests finding and how it plans to spend an additional 50 billion hryvnias.

The government has approved the draft state budget for 2025 for the second reading in the Verkhovna Rada. They aim to increase the general fund budget revenues by 50 billion hryvnias. Where will they find this money and what are they planning to spend it on? Read the overview by RBC-Ukraine financial editor Ruslan Kislyak.

The Cabinet of Ministers has approved the draft state budget for 2025 for the second reading in the Verkhovna Rada. The document was revised by the government after the first reading, which took place on October 31. Now the Rada must consider and adopt the budget in full by November 20.

Where additional revenues will be sought

The projected revenues of the state budget for 2025 (excluding transfers) are set at over 2.32 trillion hryvnias, including general fund revenues of 2.13 trillion hryvnias and special fund revenues of 193.87 billion hryvnias. Compared to the first reading of the state budget draft, total revenues have increased by 2.82 billion hryvnias, with general fund revenues increased by 50.01 billion hryvnias, while special fund revenues have been reduced by 47.19 billion hryvnias.

The government identified the main sources for ensuring the additional 50.01 billion hrynias in general fund revenues as follows. First and foremost, it was decided to abandon the funding of the state road fund in the amount of 43.21 billion hryvnias. This idea, supported by parliament during the first reading of the budget, received scandalous publicity in society – people could not understand how it was possible to spend tens of billions on road repairs while there were insufficient funds for the country's defense. Therefore, the government has abandoned this idea. The specified amount will be fully directed to the general fund budget to be used for defense needs.

However, roads will not be left completely without funding. The budget draft includes a new budget program called "Development and Maintenance of Public Roads" with an annual funding of 12.6 billion hryvnias.

Officials have also partially removed another controversial provision adopted by parliament in the first reading of the budget draft – the increase in funding for prosecutors' salaries by 2.7 billion hryvnias. For the second reading, it is proposed to reduce the mentioned amount by 1.2 billion hryvnias.

Additionally, the state expects to receive 6.28 billion hryvnias as a result of clarifying the expected revenue amounts from several sources included in the document during the first reading. In particular, an increase in enterprise profit tax revenues is expected by 41.8 billion hryvnias and a rent payment for the use of subsoil by 420 million hryvnias. At the same time, a decrease in revenues from personal income tax and fees is expected by 20.12 billion hryvnias and dividends on state shares in enterprises by 15.82 billion hryvnias.

The government is seeking additional funding sources for the budget in 2025 (photo: bank.gov.ua)

What the money is planned to be spent on

Due to the increase in general fund budget revenues, the maximum amount for providing state guarantees has been increased by 1.5 billion hryvnias.

The total planned expenditures of the state budget are set at 3.995 trillion hryvnias, including general fund expenditures of 3.71 trillion hryvnias and special fund expenditures of 285.27 billion hryvnias. Compared to the first reading of the budget draft, total expenditures have increased by 2.82 billion hryvnias, with general fund expenditures increased by 50 billion hryvnias, while special fund expenditures decreased by 47.19 billion hryvnias.

Increased expenditures are planned, in particular, for:

• the development of armaments and military equipment – by 1.02 billion hryvnias;
• increased wages for educators involved in conducting the National Multi-Subject Test – by 65.9 million hryvnias;
• supporting the activities of state educational institutions in healthcare – by 34.4 million hryvnias;
• grant support for scientific research by the National Research Fund – by 143.1 million hryvnias;
• specialized medical assistance – by 50 million hryvnias;
• reimbursement of the cost of medicines under the state guarantee program – by 596 million hryvnias;
• providing day care services for children with disabilities – by 328.6 million hryvnias;
• providing housing assistance to internally displaced persons – by 1 billion hryvnias;
• state support for the development of livestock and processing of agricultural products – by 1 billion hryvnias;
• support for cultural and artistic projects – by 105 million hryvnias;
• state assistance for the purchase of books – by 100 million hryvnias;
• strategic communications and protection of the national information space – by 200 million hryvnias;
• protection of state authorities and officials – by 198.3 million hryvnias.

The budget's priority during wartime is defense expenditures (photo: Getty Images)

The planned state expenditures for investment projects have increased for the second reading from 25 billion hryvnias to over 36 billion. In particular, the state plans to spend:

• 11.8 billion hryvnias – on education;
• 8 billion – on water supply;
• 6 billion – on social protection;
• 5.6 billion – on healthcare;
• 4.4 billion – on transport;
• 502 million – on public administration;
• 70 million – on cultural projects, including the construction of shelters.

The draft budget for 2025 includes a number of new budget programs.

In particular, 11.997 billion hryvnias is allocated for additional payments to high school teachers.

Enterprises in the defense industry will receive additional financial support of 500 million hryvnias from the state.

300 million hryvnias will be allocated for additional training for media workers.

827.9 million hryvnias is earmarked for funding critical infrastructure in civil aviation.

The government plans to direct 1 billion hryvnias towards regional development.

1 billion hryvnias is planned for supporting the state program "єВідновлення." Additionally, 3 billion hryvnias will be allocated for compensation for destroyed housing.

To support Ukrainians abroad and facilitate their return to Ukraine, the budget proposes to allocate 150 million hryvnias.

Moreover, 2.2 billion hryvnias is intended for activities to support and assist war veterans, their families, and the families of the deceased, while another 463.9 million hryvnias will go towards the operations of the Ministry of Veterans Affairs.

Recall that on September 13, the Cabinet approved the draft state budget for 2025. On October 31, parliament approved the document in the first reading.