Government Increases Windfall Tax on Petrol Exports, Reduces Diesel Duty
The Indian government has raised the windfall tax on petrol exports while cutting the duty on diesel exports, effective immediately.
New Delhi, October 16 (Daily Kiran) : The Indian government has announced an increase in the windfall tax on petrol exports, raising it to ₹2.5 per liter. This change, effective immediately, comes alongside a reduction in the export duty on diesel, which has been cut from ₹16 to ₹8.5 per liter.
According to a notification from the Finance Ministry, the new tax rates took effect on October 16, 2026. Previously, the windfall tax on petrol was set at ₹0.5 per liter.
The government regularly reviews these export duties every fortnight, adjusting them based on fluctuations in international crude oil and petroleum product prices. This latest adjustment follows a period of volatility in global oil prices exacerbated by geopolitical tensions.
In September, the government had lowered the windfall tax and export duties on petrol, diesel, and aviation turbine fuel (ATF). At that time, the export duty on petrol was reduced to ₹0.5 per liter, which included a special additional excise duty (SAED) of the same amount.
Earlier revisions included a drop in diesel export duties from ₹3 to ₹1 per liter, and a decrease in the windfall tax from ₹24 to ₹19 per liter. In August, the government had increased the petrol export duty from ₹2.5 to ₹3.5 per liter, while raising diesel duties significantly.
The windfall tax was first introduced in July 2022 in response to soaring global crude oil prices following the Russia-Ukraine conflict. It was reinstated in March 2026 during a spike in prices due to the conflict between the U.S.-Israel and Iran.
