Fuel Export Tax Shake-Up: Centre Hikes Diesel, ATF Duty, Cuts Petrol Levy

The Centre has once again revised windfall taxes on petroleum exports, increasing the levy on diesel and aviation turbine fuel (ATF) while reducing the duty on petrol exports, as higher global crude oil prices improve refining margins. The revised rates, notified by the Finance Ministry, came into effect on Thursday and reflect the government's periodic review of export duties in line with movements in international oil prices and refining economics. Diesel, ATF Export Duties Increased According to a Finance Ministry notification, the export duty on diesel has been increased to Rs 15.5 per litre from Rs 8.5 per litre. Similarly, the levy on aviation turbine fuel (ATF) exports has been raised to Rs 14.5 per litre, up from Rs 7.5 per litre. In contrast, the government has lowered the export duty on petrol to Rs 2.5 per litre from Rs 4 per litre. The revised rates became effective from July 16, the notification stated. Higher Oil Prices Trigger Fresh Duty Review The latest revision comes against the backdrop of elevated crude oil prices following the escalation of hostilities between the United States and Iran. Global oil markets witnessed heightened volatility earlier this week after US President Donald Trump reimposed a naval blockade on Iranian ports, prompting retaliatory strikes by Iran on US infrastructure in the region. The sharp rise in crude prices has improved refining margins, prompting the government to recalibrate windfall taxes on petroleum exports. The Centre periodically reviews the Special Additional Excise Duty (SAED) on domestically produced crude oil and exports of petroleum products to keep pace with changes in international crude prices and refining profitability, according to the Finance Ministry. ALSO READ: Gautam Adani Files Sworn Affidavit, Denies Any Deal Behind US DOJ Indictment Dismissal Another Revision Within Weeks This is the second revision in the windfall...