ДЕРЖАВНИЙ БЮДЖЕТ УКРАЇНИ В УМОВАХ ВІЙНИ: СТРУКТУРНІ ТРАНСФОРМАЦІЇ, ФІСКАЛЬНІ ДИСБАЛАНСИ ТА ВИКЛИКИ ФІНАНСОВІЙ БЕЗПЕЦІ
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| author | Бачо, Р. Й. Сочка, К. А. Кокош, П. |
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| author_institution_txt_mv | [
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"author": "Р. Й. Бачо",
"institution": null
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{
"author": "К. А. Сочка",
"institution": null
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{
"author": "П. Кокош",
"institution": null
}
] |
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| doi_str_mv | 10.32702/2306-6792.2026.10.138 |
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138
АГРОСВІТ № 10, 2026
ISSN 2306-6792Copyright © The Author(s). This is an open access article distributed under the terms of the Creative
Commons Attribution License 4.0 (https://creativecommons.org/licenses/by/4.0/).
УДК 336.14:351.863]:355.01
R. Bacho,
Doctor of Economic Sciences, Professor, Head of the Department of Accounting and Auditing,
Ferenc Rakoczi II Transcarpathian Hungarian University
ORCID ID: https://orcid.org/0000-0002-5957-7571
K. Sochka,
PhD in Economics, Associate Professor, Associate Professor of the Department of Accounting
and Auditing, Ferenc Rakoczi II Transcarpathian Hungarian University
ORCID ID: https://orcid.org/0000-0002-6247-221X
P. Kokosh,
Student of the Educational Program "Financial Security",
Ferenc Rakoczi II Transcarpathian Hungarian University
ORCID ID: https://orcid.org/0009-0006-4315-8897
THE STATE BUDGET OF UKRAINE UNDER
WARTIME CONDITIONS: STRUCTURAL
TRANSFORMATIONS, FISCAL IMBALANCES,
AND CHALLENGES TO FINANCIAL SECURITY
DOI: 10.32702/2306-6792.2026.10.138
Р. Й. Бачо,
д. е. н., професор, завідувач кафедри обліку і аудиту,
Закарпатський угорський університет імені Ференца Ракоці ІІ
К. А. Сочка,
к. е. н., доцент, доцент кафедри обліку і аудиту,
Закарпатський угорський університет імені Ференца Ракоці ІІ
П. Кокош,
здобувачка вищої освіти, освітня програма "Фінансова безпека",
Закарпатський угорський університет імені Ференца Ракоці ІІ
ДЕРЖАВНИЙ БЮДЖЕТ УКРАЇНИ В УМОВАХ ВІЙНИ: СТРУКТУРНІ ТРАНСФОРМАЦІЇ,
ФІСКАЛЬНІ ДИСБАЛАНСИ ТА ВИКЛИКИ ФІНАНСОВІЙ БЕЗПЕЦІ
The study examines the structural transformation of Ukraine's State Budget under wartime conditions, focusing on
changes in the composition of budget revenues and expenditures, as well as fiscal imbalances and risks to financial security.
The relevance of the research stems from profound changes in the functioning of Ukraine's public finance system during
the period of 2021—2025, accompanied by a sharp increase in defense and security expenditures (from 22.3% to 71.1% of
total state budget expenditures), a widening budget deficit (from 3.6% to 18.3% of GDP), rising public debt, and growing
dependence of the budgetary system on international financial assistance (from 0.1% to 14.3% of state budget revenues).
The research is based on methods of structural and dynamic analysis, comparison, generalization, analytical grouping,
and a systems approach.
The paper analyzes the dynamics of Ukraine's State Budget revenues and expenditures during 2021-2025, identifies
the key changes in the structure of budgetary resources under wartime conditions, and evaluates selected indicators of
the state's fiscal security. The results suggest that wartime conditions led to the formation of a fiscal mobilisation model,
in which defense and security expenditures became the dominant budgetary priority alongside a simultaneous decline in
the share of economic and social expenditures. The study shows that the increasing role of international financial assistance
contributed to maintaining the state's short-term financial stability; however, it also intensified the budgetary system's
dependence on external sources of financing. The calculated fiscal security indicators confirmed the growing budget
deficit, the increasing level of GDP redistribution through the budgetary system, and the accumulation of structural
fiscal imbalances.
АГРОСВІТ № 10, 2026
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ISSN 2306-6792 Copyright © The Author(s). This is an open access article distributed under the terms of the Creative
Commons Attribution License 4.0 (https://creativecommons.org/licenses/by/4.0/).
PROBLEM STATEMENT IN THE CONTEXT
OF CURRENT SCIENTIFIC AND PRACTICAL
CHALLENGES
Under wartime conditions, the State Budget
has become the central instrument for maintaining
macro-financial stability, socio-economic deve-
lopment, and the financial security of the state.
During the full-scale war, the role of the State
Budget has significantly increased, as the bud-
getary system has become the main instrument for
financing the defense sector, maintaining the
operation of critical infrastructure, and stabilizing
the socio-economic situation in the country.
Military actions, the destruction of industrial and
energy infrastructure, declining economic activity,
The research summarizes the most relevant risks related to budget revenue formation, tax administration, the use of
budgetary funds, and the long-term sustainability of the State Budget. Several directions for mitigating fiscal risks are
proposed, including the restoration of the domestic revenue base, increasing the efficiency of budget expenditures, the
development of digital tax administration tools, and the gradual reduction of dependence on external financing.
У статті досліджено структурну трансформацію доходів та видатків державного бюджету України в умовах воє-
нних дій, проаналізовано тенденції формування доходів і видатків бюджету, а також оцінено фіскальні дисбаланси
та ризики для фінансової безпеки держави. Актуальність теми зумовлена кардинальними змінами у функціонуванні
системи державних фінансів України за досліджуваний період 2021—2025 років, що супроводжуються різким зрос-
танням видатків державного бюджету на оборону та безпеку (з 22,3% до 71,1%), посиленням дефіциту бюджету (з
3,6% до 18,3% ВВП), підвищенням рівня державного боргу та зростанням залежності бюджетної системи від міжна-
родної фінансової допомоги (з 0,1% до 14,3% доходів державного бюджету). У процесі дослідження використано
методи структурного та динамічного аналізу, порівняння, узагальнення, аналітичного групування та системного підхо-
ду.
Проведено аналіз динаміки доходів і видатків державного бюджету України за 2021—2025 рр., визначено особ-
ливості зміни структури бюджетних ресурсів в умовах війни та оцінено окремі індикатори фіскальної безпеки дер-
жави. Встановлено, що у період дослідження відбулося формування моделі воєнної фіскальної мобілізації, коли ос-
новне значення мають видатки на оборону та безпеку при одночасному скороченні частки видатків економічного та
соціального спрямування. Обгрунтовано, що зростання ролі міжнародної фінансової допомоги дозволило підтрима-
ти короткострокову фінансову стійкість держави, однак одночасно посилило залежність бюджетної системи від
зовнішніх джерел фінансування. Розраховані індикатори фіскальної безпеки підтвердили посилення дефіцитності
бюджету, зростання рівня перерозподілу ВВП через бюджетну систему та накопичення структурних фіскальних дис-
балансів.
Узагальнено актуальні ризики у сфері формування доходів бюджету, податкового адміністрування, викорис-
тання бюджетних коштів та забезпечення довгострокової збалансованості державного бюджету. Запропоновано ок-
ремі напрями мінімізації фіскальних ризиків, пов'язані з відновленням власної дохідної бази, підвищенням ефектив-
ності бюджетних видатків, розвитком цифрових інструментів податкового адміністрування та поступовим знижен-
ням залежності від зовнішнього фінансування.
Key words: State Budget; financial security; fiscal imbalances; budget policy; budget deficit;
international financial assistance.
Ключові слова: державний бюджет; фінансова безпека; фіскальні дисбаланси; бюджетна
політика; дефіцит бюджету; міжнародна фінансова допомога.
forced population migration, and increasing
security risks have affected both the formation of
State Budget revenues and the structure of public
expenditures. Additionally, the sharp increase in
defense and security financing needs has led to a
reorientation of budget policy toward wartime
priorities, accompanied by a substantial expansion
of the budget deficit, rising public debt, limited
financing of other expenditure categories, and
increasing dependence of the budgetary system on
international financial assistance.
Under these conditions, ensuring fiscal
sustainability and the financial security of the state
becomes particularly important. The formation of
a wartime fiscal mobilization model, in which
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defense expenditures become dominant, is simu-
ltaneously accompanied by reduced opportunities
for financing economic needs, selected social
programs, and investments in human capital. At the
same time, the risks of accumulating structural
imbalances within the budgetary system,
deepening dependence on external financing
sources, and generating long-term negative
consequences for post-war socio-economic
recovery are increasing.
ANALYSIS OF RECENT RESEARCH AND
PUBLICATIONS RELATED TO THE PROBLEM
AND IDENTIFICATION OF UNRESOLVED
ASPECTS OF THE ISSUE ADDRESSED
IN THE ARTICLE
The reconsideration of the role of Ukraine's
State Budget in the context of the full-scale war
has become an important area of contemporary
Ukrainian academic discourse. Existing studies pay
significant attention to budget sustainability, struc-
tural changes in public revenues and expenditures,
the growing role of international financial assis-
tance, rising debt pressures, and the transformation
of fiscal policy under wartime conditions. A
number of studies also emphasize the priorities of
financing defense and security needs, the risks of
deepening fiscal imbalances, and the necessity of
adapting budget regulation instruments to the
challenges of prolonged wartime economic
pressure.
Yu. Radionov [1] investigates the transfor-
mation of the budgetary system under martial
law, focusing on the increasing centralization of
budgetary resources, shifts in expenditure prio-
rities, and the strengthening role of the State
Budget in supporting national defense capacity.
The author substantiates that the war has fun-
damentally transformed budget policy priorities
by intensifying defense and security financing,
expanding the budget deficit and public debt,
and increasing the dependence of public finances
on international grant and loan support. Of
particular importance is the author's conclusion
regarding the formation of a new wartime model
of State Budget functioning in which the defense
function becomes dominant, generating struc-
tural imbalances and new threats to financial
security.
D. Shkvaruk [2] focuses on the transformation
of Ukraine's State Budget revenues and expen-
ditures under wartime conditions. Particular
attention is paid to the shift in budget priorities
toward defense financing and support for critical
infrastructure. The author argues that under
martial law the State Budget has effectively
transformed from an instrument of long-term
socio-economic development into a mechanism for
mobilizing financial resources to support defense
needs, public welfare, and the functioning of
critical infrastructure. The study also emphasizes
the need for flexible budget forecasting, the
digitalization of the budget process, and increased
transparency in the use of budgetary resources as
prerequisites for improving the effectiveness of
budget policy under conditions of prolonged
wartime pressure.
The study by the authors [3] examines the
transformation of the expenditure structure of
Ukraine's State Budget under conditions of the full-
scale war, with a particular focus on the inten-
sification of structural imbalances and risks to the
state's budget security. The authors argue that
martial law has led to a transition from the model
of a "social state" to that of a "security-oriented
state", in which defense and security expenditures
have become dominant priorities, while the
relative share of financing for the social sector,
education, healthcare, and infrastructure
development has declined. The study also notes
that the prolonged dominance of defense expen-
ditures creates several long-term fiscal risks,
including chronic underfunding of human capital,
the accumulation of "deferred social debt", the
degradation of social infrastructure, and increasing
dependence of the budgetary system on external
financing.
In his study, M. Pasichnyi [4] examines changes
in Ukraine's fiscal and tax policy under wartime
conditions and substantiates the priorities of State
Budget revenue formation aimed at financing the
defense and security sector. The study argues that
under conditions of a prolonged war, important
reserves for increasing budget revenues should
include not only higher tax rates, but also the
reduction of the shadow economy, stronger
control over excisable goods markets and the
gambling sector, as well as the legalization of labor
remuneration. The author also stresses the need
to maintain a balance between increasing the fiscal
burden and preserving the conditions necessary for
economic recovery, since excessive tax pressure
contributes to further shadowing of the economy
and negatively affects the pace of economic
recovery.
The review of domestic academic research
shows that the most studies focus on specific
aspects of fiscal and budget policy, the dynamics
of budget revenues and expenditures, or the
financing of the defense sector. At the same time,
the issues related to a comprehensive assessment
of the structural transformation of Ukraine's State
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Commons Attribution License 4.0 (https://creativecommons.org/licenses/by/4.0/).
Budget under wartime conditions, particularly in
the context of increasing fiscal imbalances and risks
to financial security, remain insufficiently
explored. Additional research is needed regarding
changes in budgetary priorities, the growing
dependence of public finances on international
financial support, the transformation of budget
revenue sources, and the long-term implications
of redirecting fiscal policy toward wartime
economic needs. These gaps in the literature
explain the relevance of the study and define its
objective and structure.
FORMULATION OF THE GOALS
OF THE ARTICLE (SETTING THE TASK)
The article aims to examine the structural
transformation of Ukraine's State Budget under
wartime conditions, assess fiscal imbalances and
risks to the state's financial security, and identify
selected directions for their mitigation.
PRESENTATION OF THE MAIN RESEARCH
FINDINGS WITH A FULL SUBSTANTIATION
OF THE SCIENTIFIC RESULTS
The role of the State Budget within the financial
system is fundamental, since the budget serves as
its core and central component, integrating taxes,
public expenditures, and public credit into a
unified mechanism. Scholars [5, p. 27] emphasize
that the main economic function of the budget lies
in regulating the distribution of GDP among
sectors of the economy, administrative-territorial
units, and different social groups. This enables the
state to accumulate financial resources necessary
for maintaining the state apparatus, ensuring
national defense, financing the social sphere, and
supporting the development of priority sectors of
the economy.
The State Budget is the principal financial plan
of the country, reflecting the priorities of state
policy and the level of socio-economic develop-
ment. The full-scale military invasion in February
2022 fundamentally transformed the macroe-
conomic environment, causing profound
structural changes in both the revenue and
expenditure components of Ukraine's budgetary
system. M. Pasichnyi [4] characterizes this process
as a transition to a "wartime fiscal model," in which
ensuring national defense becomes an uncon-
ditional priority.
To identify these transformations, the dynamics
of State Budget revenues during 2021—2025 were
analyzed (Table 1).
State Budget revenues increased from UAH
1,296.9 billion (2021) to UAH 3,834.2 billion (2025),
i.e., by UAH 2,537.3 billion (or 2.9 times). Ho-
wever, this increase was predominantly nominal
and largely driven by inflation acceleration and
structural wartime changes in the taxation system,
including tax rate increases and expansion of the
military levy base. Tax revenues rose from UAH
1,107.1 billion to UAH 2,015.8 billion (+UAH
908.7 billion, or +82.1%), although their relative
share in total revenues declined from 85.3% to
52.6% over the analyzed period. This decline
reflects the outpacing growth of non-tax revenues
and international transfers, which acquired
critical importance within the wartime fiscal
model.
A significant trend of the wartime period was
the unprecedented growth of official transfers
from international institutions, which increased
from UAH 13.9 billion (2021) to UAH 490.6 billion
(2022) and reached UAH 600.0 billion (2025). Non-
tax revenues also grew particularly dynamically,
(from UAH 163.0 billion to UAH 1,165.4 billion,
primarily due to the inclusion of revenues
generated from confiscated assets and own
revenues of budgetary institutions. However, for
accurate intertemporal comparisons, it should be
considered that the composition of this revenue
category changed substantially during the wartime
period in accordance with current regulatory acts.
The structural analysis of budget revenues
confirms the existence of a profound trans-
formation of the revenue base. The share of
international transfers increased from 0.1% (2021)
to 14.3% (2025), generating considerable medium-
term fiscal vulnerability, since a decline in
international assistance without a proportional
increase in domestic revenues may result in
insufficient financing of public expenditures.
Source: compiled by the authors based on [6].
Years Deviation (2025 / 2021)
Revenue Groups
2021 2022 2023 2024 2025 UAH bln Growth Rate, %
Total, including: 1 296,9 1 787,4 2 672,0 3 122,7 3 834,2 +2 537,3 +195,6
Tax revenues 1 107,1 949,8 1 583,0 1 869,0 2 015,8 +908,7 +82,1
Non-tax revenues 163,0 346,3 421,0 484,0 1 165,4 +1 002,4 +615,0
Capital revenues 0,3 0,1 0,2 0,3 5,0 +4,7 +1 566,7
Domestic official transfers 12,6 4,0 167,0 268,9 48,0 +35,4 +281,0
International official transfers 13,9 490,6 500,5 500,5 600,0 +586,1 +4 216,5
Table 1. Dynamics of Ukraine's State Budget Revenues, 2021–2025, UAH bln
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In order to examine expenditure transfor-
mations, the dynamics of State Budget expen-
ditures by functional classification were analyzed
(Table 2).
Total State Budget expenditures rose from
UAH 1,490.3 billion in 2021 to UAH 5,473.6 billion
in 2025, increasing 3.7 times during the analyzed
period. Defense expenditures became the primary
factor behind this growth, expanding from UAH
127.5 billion to UAH 3,069.9 billion, or by 24.1
times. As a result, the share of defense expenditures
increased from 8.6% in the pre-war year of 2021
to 56.1% in 2025. Expenditures on law enforcement
and security also demonstrated substantial growth,
increasing from UAH 174.4 billion to UAH 819.4
billion (4.7 times). Combined defense and security
expenditures reached UAH 3,889.3 billion,
accounting for 71.1% of total State Budget
expenditures in 2025.
In contrast, еxpenditures on economic activity
decreased by UAH 12.3 billion (?6.8%) in absolute
terms, while their share in total expenditures fell
from 12.1% to 3.1%. Education expenditures grew
only nominally (+5.5% over five years), despite the
tripling of total expenditures, resulting in a
significant decline in the relative share of education
spending within the budget from 4.3% to 1.2%.
Although social protection expenditures increased
by UAH 114.1 billion (+33.6%), their share in total
expenditures declined from 22.8% to 8.3% over the
analyzed period.
Therefore, the revenue and expenditure
structure of Ukraine's State Budget experienced
a substantial transformation during 2021—2025
as a consequence of wartime conditions. Despite
the growth of the domestic revenue base, its
growth dynamics were considerably weaker than
the expansion of budget expenditures, which led
to the emergence of a chronic budget deficit
financed by external borrowing and international
assistance.
Financial security under wartime conditions
acquires exceptional importance for maintaining
macro-financial stability, financing defense and
security expenditures, supporting social expendi-
tures, and ensuring the functioning of the economy.
Current academic studies define financial security
as the capacity of the state's financial system to
maintain the stability of budgetary, debt, cur-
rency, and banking systems in the face of internal
and external threats. N. Sytnyk and B. Kravchenko
[7] identify the major threats to Ukraine's financial
security during the war as a widening budget
deficit, rising debt burdens, a high level of shadow
economic activity, dependence on external
financing, and structural fiscal imbalances. Con-
sequently, the assessment of selected fiscal security
indicators enables a more comprehensive evalua-
tion of the transformation of Ukraine's public
finances under wartime conditions and helps
identify potential risks to long-term financial
sustainability (Table 3).
Indicator 2021 2022 2023 2024 2025
State Budget Deficit-to-GDP Ratio 3,63 17,62 20,31 17,64 18,32
GDP Redistribution through the Consolidated Budget 30,44 42,3 47,5 46,8 48,6
Public Debt Servicing Expenditure Share in State Budget Revenues 12,0 8,8 9,3 9,8 9,4
Share of Tax Revenues in State Budget Revenues 85,3 53,2 45,1 52,8 52,6
Share of International Transfers in State Budget Revenues 0,1 26,9 16,2 15,2 14,3
Share of Economic Expenditures in State Budget Expenditures 12,1 3,5 3,4 3,6 3,1
Share of Social Expenditures in State Budget Expenditures 39,4 25,1 18,1 16,7 13,8
Share of Defense and Public Security Expenditures in State Budget
Expenditures
22,3 59,1 66,5 66,8 71,1
Table 3. Dynamics of Selected Fiscal Security Indicators of Ukraine, 2021—2025, %
Source: compiled by the authors based on [6; 8].
Years Deviation (2025/2021)
Expenditure Groups
2021 2022 2023 2024 2025 UAH bln
Growth Rate,
%
Total, including 1490,3 2 705,4 4014,4 4486,7 5473,6 +3 983,3 +267,3
General public services 206,6 202,0 296,1 374,3 438,7 +232,1 +112,3
National defense 127,5 1 142,9 2097,6 2304,5 3069,9 +2 942,4 +2 307,8
Public Safety and Security 174,4 443,3 574,6 692,7 819,4 +645,0 +369,8
Economic activity 181,0 95,4 134,3 163,1 168,7 −12,3 −6,8
Health care 170,5 184,3 179,3 201,4 218,8 +48,3 +28,3
Culture and sports 16,0 11,1 11,8 16,2 15,8 −0,2 −1,2
Education 63,8 58,0 60,5 64,7 67,3 +3,5 +5,5
Social protection and social security 339,3 426,0 469,3 464,7 453,4 +114,1 +33,6
Table 2. Dynamics of Ukraine's State Budget Expenditures by Functional Classification,
2021—2025, UAH billion
Source: compiled by the authors based on [6].
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The calculated fiscal security indicators
demonstrate a significant expansion of the state's
role in the redistribution of financial resources
within the wartime economy and confirm the
strengthening of fiscal risks to financial security
over the analyzed period. The rise in GDP
redistribution through the Consolidated Budget
from 30.4% to 48.6% reflects the growing scale of
state intervention in socio-economic processes.
Among the most pronounced trends were the
substantial increase in the State Budget deficit level
(from 3.6% to 18.3% of GDP) and the overwhel-
ming dominance of defense and security expen-
ditures within the expenditure structure. Defense
and public security expenditures increased from
22.3% of total expenditures in 2021 to more than
71% in 2025, which confirms the emergence of a
wartime fiscal mobilization framework. At the
same time, the share of expenditures allocated to
economic and social purposes declined sharply,
creating medium-term risks for economic
recovery and the development of human capital.
An important trend was also the reduction in
the share of tax revenues in total State Budget
revenues accompanied by the increasing im-
portance of international financial assistance.
The conducted analysis allows the identi-
fication of a set of fiscal risks formed under wartime
economic conditions that may substantially affect
the state's financial sustainability in the medium-
term perspective, as well as the formulation of
selected approaches to their mitigation (Table 4).
The study summarizes risks associated with key
areas of budgetary activity, including budget reve-
nue formation, public expenditure management,
tax administration, and maintaining State Budget
balance.
One of the key risks related to budget revenue
formation is the increasing dependence of the State
Budget on external financing sources. While such
support enables the uninterrupted financing of
critical expenditures, it simultaneously creates
significant fiscal vulnerability to changes in
external financial assistance volumes and to the
political decisions of international partners.
A further concerning trend is the declining
proportion of tax revenues within total budget
revenues, reflecting the contraction of the tax base
caused by declining economic activity, extensive
destruction of industrial infrastructure, energy
supply disruptions, losses of productive capacity,
and labor migration.
Another important category of risks relates to
the persistent imbalance of the State Budget, the
financing of which largely depends on external
borrowing and international financial support.
This, in turn, contributes to the accumulation of
public debt and the subsequent growth of debt
servicing expenditures.
One of the significant sources of fiscal risks in
modern conditions is the insufficient effectiveness
of tax administration, which is associated with the
persistence of tax evasion schemes, a high degree
of shadow economic activity in certain sectors, the
expansion of informal employment, and
insufficient efficiency of tax control. These factors
contribute to undercollection of planned State
Budget revenues, increasing disparities in tax
Budgetary Area Problem Potential Consequences Mitigation Measures
Budget Revenue
Formation
Growing dependence on international
transfers;
Further narrowing of the tax base;
Low predictability of budget revenues
under the wartime;
Fiscal vulnerability to external
factors;
Declining revenues from major taxes;
Complications in budget planning
and the risk of cash gaps;
Expansion of the tax base;
Reduction of inefficient tax exemptions;
Improvement of forecasting quality;
Tax Administration Insufficient effectiveness of tax control;
Persistence of tax evasion schemes;
Shortfalls in planned revenues;
Expansion of the shadow economy;
Increasing transaction costs;
Digitalization of tax administration;
Integration of state registers;
Implementation of e-audit;
Development of the “e-Excise” system;
Strengthening risk-based control;
Use of Budgetary
Funds
(Expenditures)
Dominance of defense expenditures;
Reduction of development expenditures;
Insufficient effectiveness of budget
programs;
Risks of non-transparent and inefficient
use of funds (including corruption-
related risks);
Rising energy costs and increasing
pressure on energy sector expenditures;
Reduction of development-oriented
economic and social expenditures;
Slower economic recovery;
Deterioration in the quality of human
capital;
Growth of inefficient expenditures
and losses of budgetary resources;
Optimization of the expenditure structure;
Restoration of financing for economic and social
development expenditures;
Prioritization of investment expenditures;
Improving budget process transparency and
strengthening fiscal control;
Development of energy efficiency and reduction
of dependence on imported energy resources;
Budget Balance Formation of a persistent budget deficit;
Outpacing growth of expenditures
relative to revenues;
Accumulation of structural imbalances;
Growth of public debt;
Increasing public debt servicing
expenditures;
Risks of macro-financial instability;
Complications for post-war recovery;
Gradual reduction of the budget deficit;
Development of the domestic public debt market;
Attraction of long-term concessional financing;
Use of borrowed funds exclusively for
development expenditures;
Table 4. Selected Fiscal Imbalances of Ukraine's State Budget and Measures for Their Mitigation
Source: compiled by the authors based on [1; 9; 10; 11; 12; 13].
144
АГРОСВІТ № 10, 2026
ISSN 2306-6792Copyright © The Author(s). This is an open access article distributed under the terms of the Creative
Commons Attribution License 4.0 (https://creativecommons.org/licenses/by/4.0/).
burden distribution, and higher transaction costs
for both public authorities and economic agents.
Enhancing the effectiveness of tax administration
without intensifying fiscal pressure on the formal
sector of the economy and consumers may be
achieved through the broader implementation of
a risk-based approach.
Regarding the expenditure component of the State
Budget, the key risk is the substantial restructuring of
expenditures marked by the overwhelming dominance
of defense and security spending, which is accompanied
by a reduction in development expenditures,
education financing, and selected social programs.
Over the medium term, this may generate delayed
negative effects associated with slower economic
recovery and declining human capital quality.
The observed trends demonstrate the emergence
of a specific model of State Budget functioning that
maintains the state's financial capacity during
wartime, but at the same time contributes to the
formation and accumulation of structural fiscal
imbalances. Without restoring the domestic revenue
base and revising expenditure priorities, the current
budgetary model may weaken long-term economic
growth and complicate post-war recovery.
CONCLUSIONS AND PROSPECTS
FOR FURTHER RESEARCH
Under wartime conditions, the State Budget of
Ukraine has become the central mechanism for
maintaining macro-financial stability, financing
defense needs, and supporting vulnerable popu-
lation groups.
During 2021—2025, Ukraine's State Budget
underwent profound structural changes driven by the
transition to a wartime economy model. These
transformations were manifested both in significant
changes to the revenue structure and in the
restructuring of expenditure priorities, ultimately
leading to the formation of multiple fiscal imbalances.
Fiscal security indicators reveal increasing
pressure on Ukraine's public finance system during
the wartime period. The most significant trends
included a sharp increase in the State Budget deficit
relative to GDP, the expansion of GDP redistri-
bution through the budgetary system, and the
strengthening dependence of the budget on
international financial support. At the same time,
the relative stabilization of public debt servicing
expenditures within budget revenues was achieved
through the outpacing growth of revenues sup-
ported by external financial assistance. Although
external financial assistance helped preserve short-
term fiscal stability, it simultaneously increased the
vulnerability of the budgetary system to reduc-
tions in external support.
The wartime fiscal model intensified several
major risks, including growing dependence on
external financing, contraction of the domestic
revenue base, and the dominance of defense ex-
penditures within the expenditure structure.
Maintaining financial sustainability in the post-war
period will require a gradual reduction of the
budget deficit, restoration of domestic revenue
capacity, enhancement of tax administration effi-
ciency, and a reorientation of budget policy toward
supporting economic development and streng-
thening social capital. Additional priorities include
improving the effectiveness of public expenditures,
increasing transparency in the use of budgetary
resources (including combating corruption
schemes), reducing the dependence of public
finances on external funding sources, limiting
shadow economic activity, and expanding the use
of digital instruments in public finance management.
Ukraine's future budget policy should gradually
shift from financing wartime needs toward supporting
long-term economic recovery and development. This
would create the basis for economic recovery, human
capital development, and stronger financial
sustainability in the post-war period.
Future research should examine the long-term
consequences of State Budget transformation
under wartime conditions on financial security and
macroeconomic stability, the evaluation of the
effectiveness of defense expenditures, the impact
of increasing public debt burdens on budget
sustainability, and the risks associated with
maintaining a high degree of fiscal centralization.
Particular attention should also be devoted to
studying mechanisms for the gradual transition
from a wartime fiscal mobilization model to a
budget policy framework aimed at socio-eco-
nomic recovery and long-term development.
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Commons Attribution License 4.0 (https://creativecommons.org/licenses/by/4.0/).
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Отримано редакцією журналу / Received: 09.05.26
Прорецензовано / Revised: 15.05.26
Дата публікації / Published: 21.05.26
|
| id | www_nayka_com_ua-article-10308 |
| institution | Agrosvit |
| keywords_txt_mv | keywords |
| language | Ukrainian |
| last_indexed | 2026-06-09T01:00:54Z |
| publishDate | 2026 |
| publisher | ДКС Центр |
| record_format | ojs |
| resource_txt_mv | wwwnaykacomua/0d/331b073a9ea75d1f04710961575e210d.pdf |
| spelling | www_nayka_com_ua-article-103082026-06-08T07:46:11Z THE STATE BUDGET OF UKRAINE UNDER WARTIME CONDITIONS: STRUCTURAL TRANSFORMATIONS, FISCAL IMBALANCES, AND CHALLENGES TO FINANCIAL SECURITY ДЕРЖАВНИЙ БЮДЖЕТ УКРАЇНИ В УМОВАХ ВІЙНИ: СТРУКТУРНІ ТРАНСФОРМАЦІЇ, ФІСКАЛЬНІ ДИСБАЛАНСИ ТА ВИКЛИКИ ФІНАНСОВІЙ БЕЗПЕЦІ Бачо, Р. Й. Сочка, К. А. Кокош, П. ДКС Центр 2026-05-21 Article Article application/pdf https://www.nayka.com.ua/index.php/agrosvit/article/view/10308 10.32702/2306-6792.2026.10.138 Журнал "Агросвіт"; № 10 (2026): АГРОСВІТ; 138-145 Agrosvit; No. 10 (2026): AGROSVIT; 138-145 2306-6792 10.32702/2306-6792.2026.10 uk https://www.nayka.com.ua/index.php/agrosvit/article/view/10308/10453 Авторське право (c) 2026 Журнал "Агросвіт" |
| spellingShingle | Бачо, Р. Й. Сочка, К. А. Кокош, П. ДЕРЖАВНИЙ БЮДЖЕТ УКРАЇНИ В УМОВАХ ВІЙНИ: СТРУКТУРНІ ТРАНСФОРМАЦІЇ, ФІСКАЛЬНІ ДИСБАЛАНСИ ТА ВИКЛИКИ ФІНАНСОВІЙ БЕЗПЕЦІ |
| title | ДЕРЖАВНИЙ БЮДЖЕТ УКРАЇНИ В УМОВАХ ВІЙНИ: СТРУКТУРНІ ТРАНСФОРМАЦІЇ, ФІСКАЛЬНІ ДИСБАЛАНСИ ТА ВИКЛИКИ ФІНАНСОВІЙ БЕЗПЕЦІ |
| title_alt | THE STATE BUDGET OF UKRAINE UNDER WARTIME CONDITIONS: STRUCTURAL TRANSFORMATIONS, FISCAL IMBALANCES, AND CHALLENGES TO FINANCIAL SECURITY |
| title_full | ДЕРЖАВНИЙ БЮДЖЕТ УКРАЇНИ В УМОВАХ ВІЙНИ: СТРУКТУРНІ ТРАНСФОРМАЦІЇ, ФІСКАЛЬНІ ДИСБАЛАНСИ ТА ВИКЛИКИ ФІНАНСОВІЙ БЕЗПЕЦІ |
| title_fullStr | ДЕРЖАВНИЙ БЮДЖЕТ УКРАЇНИ В УМОВАХ ВІЙНИ: СТРУКТУРНІ ТРАНСФОРМАЦІЇ, ФІСКАЛЬНІ ДИСБАЛАНСИ ТА ВИКЛИКИ ФІНАНСОВІЙ БЕЗПЕЦІ |
| title_full_unstemmed | ДЕРЖАВНИЙ БЮДЖЕТ УКРАЇНИ В УМОВАХ ВІЙНИ: СТРУКТУРНІ ТРАНСФОРМАЦІЇ, ФІСКАЛЬНІ ДИСБАЛАНСИ ТА ВИКЛИКИ ФІНАНСОВІЙ БЕЗПЕЦІ |
| title_short | ДЕРЖАВНИЙ БЮДЖЕТ УКРАЇНИ В УМОВАХ ВІЙНИ: СТРУКТУРНІ ТРАНСФОРМАЦІЇ, ФІСКАЛЬНІ ДИСБАЛАНСИ ТА ВИКЛИКИ ФІНАНСОВІЙ БЕЗПЕЦІ |
| title_sort | державний бюджет україни в умовах війни: структурні трансформації, фіскальні дисбаланси та виклики фінансовій безпеці |
| url | https://www.nayka.com.ua/index.php/agrosvit/article/view/10308 |
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