India Changes Fuel Export Taxes From September 1: Petrol, Diesel, ATF Get New Rates; Check Latest Windfall Tax

The Centre has revised the windfall tax structure on petroleum product exports with effect from September 1, bringing petrol exports back under the tax net and increasing the levy on diesel shipments. At the same time, the government has provided a small reduction in the export duty on aviation turbine fuel (ATF).

Windfall Tax on Petrol, Diesel and ATF Revised From September 1

Under the revised rates, petrol exported from India will attract a duty of Rs 1.5 per litre. The levy on petrol had been reduced to nil during the previous fortnightly review on August 15, but the latest revision has brought the fuel back under the export tax framework.

Windfall Tax Changes: Petrol Levy Returns, Diesel Duty Increased to Rs 25/Litre

The government has also raised the levy on diesel exports to Rs 25 per litre from Rs 24 per litre earlier. The revised duty includes Rs 24 per litre as Special Additional Excise Duty (SAED) and Re 1 per litre as Road and Infrastructure Cess.

In contrast, the duty on aviation turbine fuel exports has been reduced slightly. ATF shipped overseas will now attract a levy of Rs 19 per litre, compared with Rs 19.5 per litre under the previous structure.

The changes are part of the government's regular review of taxes imposed on petroleum products exported from India. The rates can be revised depending on movements in international crude oil prices and refining margins.

Petrol exports will now attract a levy of Rs 1.5 per litre after being exempt from the tax during the previous review. Diesel exports will face a higher duty of Rs 25 per litre, while the tax on ATF exports has been reduced to Rs 19 per litre.

These revised rates apply only when petroleum products are exported from India. Petrol and diesel sold within the country are not covered by these changes, and the existing excise duty structure for domestic fuel sales remains unchanged.

Impact of Revised Duties On Oil Refiners

The revised export levies could influence the earnings of Indian refiners that sell petroleum products in overseas markets. A higher duty means a portion of the revenue generated from exports goes towards taxes, which can affect the profitability of international fuel sales.

For the government, windfall taxes provide a mechanism to collect part of the additional gains earned by exporters during periods of favourable global energy prices. The periodic revisions also allow authorities to respond to changing conditions in international oil and fuel markets.

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