Govt imposes Special Additional Excise Duty on petrol, cuts tax on diesel, aviation fuel
PTC News Desk: The government on Friday introduced a windfall tax of Rs 3 per litre on petrol exports and reduced the levy on diesel exports to Rs 16.5 per litre and on aviation turbine fuel (ATF) to Rs 16 per litre, with effect from May 16.
In a notification, the Finance Ministry said the road and infrastructure cess on exports of petrol and diesel would remain nil. It also clarified that there would be no change in the current duty structure for petrol and diesel meant for domestic consumption.
The special additional excise duty (SAED) of Rs 3 per litre on petrol has been imposed for the first time since the West Asia conflict began. Earlier, on March 26, the government had imposed export duties of Rs 21.50 per litre on diesel and Rs 29.5 per litre on ATF. These were increased to Rs 55.5 per litre and Rs 42 per litre, respectively, during the April 11 review, before being reduced to Rs 23 per litre and Rs 33 per litre in the April 30 review.
The windfall tax was introduced to boost domestic fuel availability amid the ongoing conflict involving the United States, Israel and Iran. The government also aimed to prevent exporters from profiting excessively from global price disparities as crude oil prices surged following the outbreak of the war.
The conflict escalated after the US and Israel carried out military strikes on Iran on February 28, prompting strong retaliation from Tehran. Since then, crude oil prices have climbed sharply, remaining above USD 100 per barrel over the past week compared to around USD 73 per barrel before the conflict.
According to the ministry, the export duty was intended to discourage fuel exports and ensure sufficient domestic supply of petroleum products during the West Asia crisis. As part of the latest revision, the export duty on diesel has been cut from Rs 23 per litre to Rs 16.5 per litre, while the levy on ATF has been reduced from Rs 33 per litre to Rs 16 per litre.
- With inputs from agencies
