Windfall tax on diesel, ATF exports hiked from June 16
Synopsis
India's Finance Ministry has raised the windfall tax on diesel exports by ₹0.5 per litre and on ATF exports by a sharper ₹3 per litre — a 32% jump — effective 16 June, as the Centre continues its fortnightly calibration of export levies first introduced in March amid the West Asia conflict. Domestic fuel prices remain untouched.
Key Takeaways
The Finance Ministry raised the SAED on diesel exports to ₹14 per litre from ₹13.5 per litre , effective 16 June .
The SAED on ATF exports was hiked more sharply to ₹12.5 per litre from ₹9.5 per litre — a rise of ₹3 per litre .
Petrol export duty remains unchanged at ₹1.5 per litre ; domestic fuel rates are also unaffected.
Export duties on diesel and ATF were first imposed in March following West Asia tensions and elevated global crude prices.
In April , the diesel export duty was raised by ₹34 per litre to ₹55.5 per litre ; a separate cess on diesel was set at ₹36 per litre .
The Centre on Tuesday, 16 June raised the windfall gains tax on diesel and aviation turbine fuel (ATF) exports, while leaving the levy on petrol unchanged for the fortnight beginning that day. The revision, notified by the Finance Ministry through a special additional excise duty (SAED) order, takes effect immediately.
Revised Export Duty Rates
The SAED on diesel exports has been raised to ₹14 per litre from ₹13.5 per litre — a modest but directional increase. The steeper hike came on ATF exports, where the duty jumped to ₹12.5 per litre from ₹9.5 per litre, a rise of ₹3 per litre or roughly 32%. The SAED on petrol exports remains unchanged at ₹1.5 per litre. Domestic consumption rates for both petrol and diesel have also been left untouched.
How the Rates Have Evolved
The previous fortnightly revision, effective 1 June, had set duties at ₹1.5 per litre on petrol, ₹13.5 per litre on diesel, and ₹9.5 per litre on ATF. Before that, in April, the Centre sharply increased excise duties on petroleum products: the export duty on diesel alone was raised by ₹34 per litre — from ₹21.5 per litre to ₹55.5 per litre. A separate notification also increased the Road and Infrastructure Cess on diesel to ₹36 per litre under the Finance Act, 2018.
Why the Windfall Tax Was Introduced
Export duties on diesel and ATF were first imposed in March, following escalating tensions in West Asia triggered by the US-Israel attack on Iran and subsequent retaliatory strikes. Elevated global crude prices made exporting refined products more profitable than supplying the domestic market, prompting refiners to divert output. The windfall tax was designed to correct that incentive and improve domestic availability of petroleum products.
What This Means for Refiners and Consumers
Private sector refiners with significant export exposure — including Reliance Industries and Nayara Energy — are the primary entities affected by SAED revisions. The fortnightly review mechanism, introduced to reflect rapidly shifting global crude and product prices, means margins on export-oriented refining operations can shift materially within a single month. Domestic pump prices, however, remain insulated for now, as the government has held those rates steady. The sharper hike on ATF is notable given the aviation sector's sensitivity to fuel costs, though the levy applies to exports rather than domestic airline supply.
What to Watch Next
The next fortnightly review is due in late June. Markets will track crude oil price movements and any further escalation in the West Asia conflict, both of which have historically driven the Centre's SAED calibration. A sustained easing in global crude prices could prompt a rollback; renewed supply disruptions could push levies higher still.
Point of View
And Tuesday's revision shows the Centre is still leaning hawkish on petroleum exports. The ATF hike — 32% in a single fortnight — stands out: it signals concern about refined-product diversion at a time when domestic aviation demand is climbing. What the revision does not address is the longer-term question of whether sustained export levies are discouraging refinery capacity expansion. India's refining margins story has been a rare bright spot for private players; if SAED volatility becomes the norm, investment calculus for new capacity could shift in ways the Centre has not publicly modelled.
NationPress
7 Aug 2026
Frequently Asked Questions
What is the windfall tax on diesel and ATF exports in India?
The windfall tax, implemented as a Special Additional Excise Duty (SAED), is a levy on exports of petroleum products including diesel and aviation turbine fuel (ATF). It was introduced in March to discourage exports at elevated global crude prices and improve domestic fuel availability amid the West Asia conflict.
What are the new SAED rates effective 16 June?
From 16 June, the SAED on diesel exports stands at ₹14 per litre (up from ₹13.5), the duty on ATF exports is ₹12.5 per litre (up from ₹9.5), and the levy on petrol exports remains at ₹1.5 per litre. Domestic fuel rates are unchanged.
Why was the ATF export duty hiked more steeply than diesel?
The Finance Ministry notification does not explicitly state a reason for the differential, but the ATF duty was raised by ₹3 per litre — about 32% — compared to ₹0.5 per litre for diesel. This suggests authorities assessed a greater risk of ATF being diverted to export markets at the current global price levels.
Who is most affected by the SAED hike on petroleum exports?
Private sector refiners with significant export operations — primarily Reliance Industries and Nayara Energy — bear the direct impact of SAED revisions, as the levy applies to exported volumes. Domestic consumers and airlines sourcing fuel within India are not directly affected by this particular revision.
When is the next windfall tax review due?
The SAED is reviewed fortnightly, so the next revision is expected in late June. The rates will be calibrated based on prevailing global crude prices and the domestic supply situation, particularly as the West Asia conflict continues to influence global energy markets.
