The Russian government plans to significantly boost its military spending in 2027, according to documents obtained by the news agency Reuters. The proposed defense budget for that year is set at 17,100 billion rubles, which is approximately 178 billion euros based on current exchange rates. This would mark a 32% increase from the 2026 budget, which was around 134 billion euros. The proposed 2027 defense budget would be nearly three times the size of France's planned military spending for the same year, estimated at 63.4 billion euros. The budget draft must be submitted to the Duma, Russia’s lower house of parliament, by October 1. However, its approval is expected to be routine, as the Duma largely functions as a formal approval body. Following recent elections, President Vladimir Putin's political party, United Russia, holds 355 out of 450 seats in the Duma, far exceeding the constitutional majority of 300 seats. Other parties in the Duma are considered part of the "systemic opposition," meaning they support the government's policies, including its military actions. Reuters reports that the government has raised its deficit forecast for 2026 from 1.6% to 3.2% of GDP. This increase is largely due to the ongoing military conflict, which is being funded more heavily through debt. Interest payments on this debt amount to nearly 4,000 billion rubles annually, or around 10% of total federal spending—more than what is spent on Education and Health combined. With foreign investors excluded due to international sanctions, the Russian government now depends on domestic banks to manage its debt, but these banks are struggling with liquidity issues. The Central Bank has kept its key interest rate at 14%, but it has warned that a larger-than-expected deficit could force it to adopt a more restrictive monetary policy, which would hurt investment. To address the financial shortfall, the government has introduced several new taxes, aiming to collect 200 billion rubles annually from the exceptional profits of companies in the metallurgy and mining sectors. Economist Vladislav Inozemtsev noted that Russia is likely to allocate more than 10% of its GDP to military spending in 2024, the highest proportion since the Soviet era. This level of investment highlights the growing economic and financial burden of the ongoing military campaign.