Govt raises petrol export duty, cuts diesel levy
NEW DELHI: The government has raised the export duty on petrol fivefold to Rs 2.5 per litre from Rs 0.5, while cutting the levy on diesel to Rs 8.5 per litre from Rs 16. The revised rates came into effect on October 16.The export duty on aviation turbine fuel (ATF) remains unchanged at Rs 10.5 per litre, according to a finance ministry notification issued on Friday.The revised rates cover the Special Additional Excise Duty (SAED), with no road and infrastructure cess (RIC) applicable on exports of petrol, diesel and ATF. The changes follow the previous revision, which took effect on October 1.Export duties on the three petroleum products are reviewed every fortnight, with rates determined by average international prices of crude oil and the respective fuels during the period since the last review.
The latest revision changes the levies on petrol and diesel in opposite directions, while leaving the ATF duty unchanged.The revised export duties will not affect the existing excise duty rates on petrol and diesel sold for domestic consumption.India initially introduced windfall taxes on fuel exports in July 2022, before withdrawing them two years later. The government brought the levy back in March 2026 as crude oil prices surged during the US-Israeli war on Iran.
The tax was intended to discourage exports and protect domestic supplies of petroleum products amid the conflict in the Middle East. It was also aimed at preventing exporters from benefiting unduly from differences between domestic and international prices as global crude oil prices rose.The government imposed export duties on diesel and ATF on March 27, 2026, and introduced the levy on petrol exports from May 16. Rates have since been reviewed every fortnight.