This is set out in a new British study, *The Putin Tax*, published on 7 October 2026. The authors consider this estimate to be conservative, as a significant portion of the damage remains unaccounted for, notes the UK Defence Journal.
What is “The Putin Tax” and who produced it?
The report “The Putin Tax” was prepared by Graeme Downie, a Labour Member of the British Parliament, and Dr Dominic Reed. Downie is the deputy chair of the All-Party Parliamentary Group (APPG) on Rearmament, which deals with issues of rearmament and defence policy.
The study is not a government assessment: the authors used open-source data, parliamentary questions, materials from the House of Commons Library, sector-specific research and information on specific incidents. That said, the study itself highlights the limitations of its methodology – the authors did not have access to classified intelligence, a dedicated analytical team or a specific research budget.
The authors describe their work as the first attempt to quantify the economic cost of Russia’s hostile activities against the UK.
By the ‘Putin Tax’, they do not mean a literal tax, but rather the total costs incurred by British companies, government bodies and taxpayers as a result of Russia’s actions.
What the estimate is based on
The main conclusion of the study is that Russian hostile activity imposes an annual burden of £2–2.5 billion on the British economy. The authors emphasise, however, that the actual figure may be significantly higher.
The calculation includes several main categories of expenditure.
Cyberattacks. The study estimates Russia-related cyber losses at approximately £1.47 billion per year, based on an assessment of the total damage to British businesses from cyberattacks and a conservative estimate of the proportion that may be attributable to Russian attacks. If the proportion is higher, the estimated damage could be even greater.
Major individual incidents. The authors estimate the average annual losses from major attacks that have been linked to Russia since 2022 at approximately £400–500 million. Examples cited by the report’s authors include attacks on Jaguar Land Rover, Royal Mail and suppliers to the UK’s National Health Service (NHS).
Underwater infrastructure. A further £250–500 million per year is estimated as the potential cost of damage and risks associated with underwater communication cables and other infrastructure. This refers specifically to an assessment of the potential impact, rather than proven annual losses of this magnitude.
Why the authors believe the actual damage is higher
One of the study’s central arguments is not so much the lack of data on individual attacks, but rather that the UK lacks a unified system for quantifying the economic damage caused by hostile actions by foreign states.
Information is currently scattered across government departments, regulators, security services, infrastructure operators, insurance companies and the private sector. As a result, no single government body is able to compile a comprehensive picture of the economic consequences, the authors emphasise.
They cite more traditional national risks – such as floods or fraud – as examples, the economic consequences of which the state attempts to assess systematically in order to make decisions on prevention and investment in protection.
According to the authors of *The Putin Tax*, the same approach is needed when it comes to the activities of foreign states.
What the study proposes
The report proposes four key steps.
The first is an annual report to the government and parliament. The Cabinet should publish an annual assessment of the economic cost of hostile actions by foreign states, indicating their presumed source where possible.
Second, regular assessments of cyber threats. The UK’s National Cyber Security Centre (NCSC) should annually assess cyberattacks linked to foreign states and their economic consequences.
Thirdly, a standardised methodology for assessing physical attacks. The Ministry of Defence is proposed to develop a methodology for calculating the damage caused by physical hostile actions against people, companies, infrastructure and British interests.
Fourthly, enhancing societal resilience. The authors propose a nationwide public information campaign on threats from foreign states, cyber security and infrastructure resilience.
The authors note, however, that their recommendations do not require any additional government spending.
A ‘tax’ that does not appear on your tax return
The authors use the term ‘Putin Tax’ to highlight the economic nature of hybrid attacks.
Unlike a conventional tax, this ‘tax’ is not paid directly to the state. It manifests itself when a company is forced to spend funds on recovery from a cyberattack rather than on investment in development, whilst government bodies allocate additional resources to protecting and enhancing the resilience of infrastructure.
To illustrate the scale of the issue, the authors have calculated that £2 billion is equivalent to the starting salaries of approximately 62,000 new qualified nurses or police officers.
This story was translated with the assistance of artificial intelligence.The translation was also reviewed by the Logos Press editorial team.
Follow our updates
Have information for the newsroom? Share it with Logos-Press
Comments
0No comments yet. You can start the conversation.
Comments are open to readers with a Logos Press account.
Sign in to comment