The central government has lowered windfall-related export levies on petrol, diesel and aviation turbine fuel (ATF), providing relief on shipments of key petroleum products from India. The revised rates have been introduced for the 15-day period beginning September 16, 2026.
According to the government order cited in the source, the Special Additional Excise Duty (SAED) and Road and Infrastructure Cess applicable to diesel exports have been reduced to ₹20 per litre from the earlier ₹25 per litre.
Export duties on ATF and petrol have also been lowered. The move comes only weeks after the government revised these levies at the beginning of September.
Importantly for consumers, the latest decision relates to export duties. The source states that the existing duty rates applicable to petrol and diesel released for domestic consumption have not been changed.
How Much Has the Tax on Diesel Exports Been Reduced?
Diesel has received the biggest reduction among the three petroleum products in absolute terms.
The combined SAED and Road and Infrastructure Cess on diesel exports has been brought down from ₹25 per litre to ₹20 per litre. This represents a reduction of ₹5 per litre from the previous rate.
The revised levy applies from September 16, according to the Finance Ministry notification cited in the report.
Petrol Export Duty Falls to ₹0.50 Per Litre
The government has also sharply reduced the duty applicable to petrol exports.
Petrol exports were previously subject to a levy of ₹1.50 per litre. Under the latest revision, that amount has been reduced to ₹0.50 per litre, translating into a reduction of ₹1 per litre.
The change is notable because the government had raised the levy on petrol exports from zero to ₹1.50 per litre from September 1.
ATF Export Levy Cut by ₹4 Per Litre
Aviation turbine fuel, which is primarily used to power aircraft, has also received a reduction.
The duty on ATF exports has been lowered from ₹19 per litre to ₹15 per litre. This means the applicable export levy has fallen by ₹4 per litre under the latest revision.
The government had already reduced the SAED on ATF earlier in September, bringing it down from ₹19.50 per litre to ₹19 per litre from September 1.
What Changed on September 1?
The September 16 revision reverses some of the increases introduced at the start of the month.
From September 1, the government had increased the combined SAED and Road and Infrastructure Cess on diesel exports from ₹24 per litre to ₹25 per litre.
For petrol, the export duty had been raised from zero to ₹1.50 per litre. ATF moved in the opposite direction, with its SAED reduced from ₹19.50 to ₹19 per litre.
The latest revision has now brought the respective levies to ₹20 per litre for diesel, ₹0.50 per litre for petrol and ₹15 per litre for ATF.
Will Petrol and Diesel Prices Become Cheaper for Consumers?
The latest announcement should not be interpreted as a direct cut in petrol or diesel retail prices at fuel stations.
According to the information in the source, the Finance Ministry said there had been no change in the existing duty rates on petrol and diesel released for domestic consumption.
The newly announced reductions specifically concern levies associated with exports. Therefore, consumers should not assume that the decision automatically translates into an equivalent reduction in pump prices.
Retail petrol and diesel prices depend on a range of other factors and should be checked separately for the latest city-wise rates.
What Is a Windfall Gains Tax?
A windfall gains tax is designed to capture part of the unusually high profits that energy companies can earn when global oil and petroleum-product prices or refining margins rise sharply.
According to the framework described in the source, the levy on domestically produced crude oil is linked to prices above a specified threshold. For exports of diesel, ATF and petrol, the levy is linked to refining or product margins crossing prescribed levels.
The applicable rates are reviewed periodically based on average oil prices and market conditions over the preceding period. This allows the government to raise or lower the levy as energy-market conditions change.
Crude oil extracted from onshore and offshore fields is processed at refineries to produce fuels and petroleum products such as petrol, diesel and ATF.
India First Introduced the Levy in 2022
India originally introduced the windfall gains tax in July 2022 as exceptionally strong international energy prices generated higher margins for some oil producers and refiners.
According to the supplied source, the levy was subsequently withdrawn in December 2024. It states that the tax was introduced again in March 2026 after a sharp rise in crude oil prices amid geopolitical tensions.
Since these levies can be revised periodically, the rates may change again depending on global crude prices, refining margins and government policy.
For the current 15-day period beginning September 16, the key takeaway is that export levies have been reduced across all three petroleum products: diesel to ₹20 per litre, ATF to ₹15 per litre and petrol to ₹0.50 per litre.
For ordinary consumers, however, the distinction remains important—the notification cited in the source changes export-related levies and does not itself announce a reduction in domestic petrol or diesel pump prices.
