Construction materials are placed outside the Luzhniki Stadium in Moscow July 14, 2014. [Photo/Agencies]

MOSCOW - Russia's budget for the 2018 World Cup is being cut by 4 percent by scrapping 25 luxury hotels.

The move would help to reduce the total cost from 664 billion rubles (12 billion dolars) to 637.6 billion, Sports Minister Vitaly Mutko told Russian news agency Tass on Tuesday.

"We don't want elite hotels built to FIFA's highest requirements to end up out of demand after the World Cup," he said.

As these hotels were to have been funded by regional government or by companies, Mutko said the savings will not reduce spending by the federal government on the tournament.

While the World Cup budget is almost entirely immune from 10 percent across-the-board cuts to federal spending this year, Mutko has previously said there will be a reduction in expenditure on staging costs and ceremonies.