Government cuts diesel export tax, raises petrol levy from 16 October

• Diesel export duty cut to Rs 8.50 per litre from Rs 16 for the fortnight beginning 16 October

• Petrol export duty raised to Rs 2.50 per litre; aviation turbine fuel levy unchanged at Rs 10.50

• Existing duty rates on petrol and diesel supplied for domestic consumption remain unchanged

The government on Friday reduced the windfall tax on diesel exports and increased the levy on petrol shipments overseas for the fortnight beginning 16 October, leaving the export duty on aviation turbine fuel (ATF) unchanged.

The combined levy of Special Additional Excise Duty (SAED) and road and infrastructure cess on diesel exports has been cut from Rs 16 to Rs 8.50 per litre. The duty on petrol exports has been increased to Rs 2.50 per litre from Rs 0.50, according to a Finance Ministry notification.

ATF exports will continue to attract a duty of Rs 10.50 per litre during the fortnight.

The ministry said the revised rates take effect on 16 October. Existing duty rates on petrol and diesel cleared for domestic consumption remain unchanged.

The export levies were introduced amid the conflict in West Asia to encourage refiners to prioritise domestic supplies. They were also intended to curb the incentive to sell fuel overseas as rising global crude prices widened opportunities for exporters to benefit from price differences.

The government first imposed export duties on diesel and ATF on 27 March and has reviewed the rates every fortnight. Petrol exports were brought under the levy from 16 May.

The latest revision reduces the tax burden on diesel shipments overseas while increasing it on petrol exports, as the government continues to use fortnightly adjustments to support domestic fuel availability.

With PTI inputs