The windfall tax levied by the federal government on the export of petrol, diesel, and aviation turbine fuel (ATF) has been reduced. These revised rates have become effective from June 1. According to a finance ministry notification, the windfall tax on petrol exports is currently ₹1.5 per liter, which is half of what it used to be earlier. The duty on diesel exports has been reduced to ₹13.5 per liter, and that on ATF to ₹9.5 per liter.

The notification states that the Road and Infrastructure Cess (ROI) on petrol and diesel exports will remain zero. The government has clarified that there has been no change in the existing duty rates on petrol and diesel exported for domestic consumption.

The Special Additional Excise Duty (SAED) on petrol on May 16 was ₹3 per liter. Following the review after two weeks, it has been reduced to ₹1.5 per liter from June 1. Similarly, the SAED on diesel exports has been reduced to ₹13.5 per liter. Similarly, the duty on ATF has been reduced from ₹16 per liter to ₹9.5 per liter.

On March 26, the government imposed an export duty of ₹21.50 per liter on diesel and ₹29.5 per liter on ATF. In the April 11 review, these were increased to ₹55.5 and ₹42 per liter, respectively.

Subsequently, in the April 30 review, these were reduced to ₹23 and ₹33 per liter. On May 16, the duty and tax were reduced to ₹16.5 and ₹16 per liter, respectively. The government imposed this windfall tax to ensure fuel availability in the country amid the conflict between the US, Israel, and Iran in West Asia.

It was also intended to prevent exporters from taking undue advantage of the price differential caused by rising global crude oil prices. On February 28, the US and Israel launched military strikes on Iran, prompting Tehran to retaliate.

Before the war began, crude oil prices were around $73 per barrel, while for the past week, they have remained above $100 per barrel. According to the Finance Ministry, this windfall tax was imposed to maintain domestic availability of petroleum products and discourage exports in the backdrop of the West Asia crisis.