Government raises windfall tax on diesel and ATF exports, petrol levy unchanged

New Delhi, June 16 : The Centre has increased the windfall gains tax on exports of diesel and aviation turbine fuel (ATF) while keeping the levy on petrol exports unchanged for the fortnight beginning Tuesday, according to a notification issued by the Finance Ministry.

Under the revised rates, the Special Additional Excise Duty (SAED) on diesel exports has been raised to Rs 14 per litre from the earlier Rs 13.5 per litre. The duty on ATF exports has witnessed a sharper increase, climbing to Rs 12.5 per litre from Rs 9.5 per litre.

However, the export duty on petrol remains unchanged at Rs 1.5 per litre. The revised tax structure came into effect immediately from Tuesday.

The government has also maintained the existing duty rates on petrol and diesel intended for domestic consumption, indicating that the latest revisions are aimed specifically at exports rather than local fuel supplies.

The changes come amid continued concerns over global crude oil price volatility and supply disruptions arising from geopolitical tensions in West Asia. Policymakers have been closely monitoring developments in the region, which remain a key determinant of international energy markets.

Earlier in May, the government had revised export duties for the fortnight beginning June 1. At that time, the SAED was fixed at Rs 1.5 per litre for petrol exports, Rs 13.5 per litre for diesel exports and Rs 9.5 per litre for ATF exports.

The windfall tax mechanism was originally introduced to ensure adequate domestic availability of petroleum products during periods of elevated global prices. By imposing higher duties on exports, the government seeks to discourage excessive overseas shipments and safeguard local fuel supplies.

In March, export duties on diesel and ATF were imposed amid escalating tensions in West Asia following military developments involving the United States, Israel and Iran. The resulting uncertainty in energy markets led to a spike in crude prices, prompting the government to take measures aimed at insulating domestic consumers from global disruptions.

The Centre has periodically revised these levies based on changes in international crude prices, refining margins and domestic supply considerations.

Separately, the government had increased excise duties on petroleum products in April. During that revision, the export duty on diesel was raised significantly by Rs 34 per litre to Rs 55.5 per litre from Rs 21.5 per litre.

In another notification issued under provisions of the Finance Act, 2018, the government had also raised the Road and Infrastructure Cess on diesel to Rs 36 per litre.

The latest adjustments reflect the government’s continuing effort to balance export incentives with domestic energy security, especially at a time when global oil markets remain sensitive to geopolitical developments and supply chain uncertainties.

Team Maverick.