Windfall tax on diesel, ATF hiked: How it affects you?
12 Apr 2026

The Indian government has hiked the export duty, or windfall tax, on diesel and aviation fuel (ATF).

The new rates are ₹55.5 per liter for diesel and ₹42 per liter for ATF. The hike comes into immediate effect, according to a notification from the finance ministry.

Earlier this year, an export duty of ₹21.50 per liter was imposed on diesel and ₹29.5 per liter on ATF to boost domestic fuel availability amid the West Asia conflict.

Export duty hike aims to curb refined fuel exports
Duty

The latest hike in export duties is not aimed at increasing government revenue but preventing exporters from exploiting price differences.

This move is part of a broader strategy to curb refined fuel exports at the cost of domestic availability, especially amid volatile global energy prices.

Notably, the export duty on petrol remains unchanged at nil, indicating that domestic supplies are currently sufficient.

Financial relief for central government
Financial impact

The windfall tax hike is expected to ease the financial burden on the Centre, which has been losing ₹5,500 crore every fortnight due to excise duty cuts.

The move also aims to protect the aviation sector from potential price shocks.

After increasing the windfall tax on ATF, officials are reviewing tax structures to prevent rising fuel costs from impacting airfares.

Broader framework for fuel export levies
Tax structure

The windfall tax hike is part of a broader framework where the government periodically revises levies on fuel exports to balance refiner profitability with local market needs.

Notably, this windfall will not apply to fuel refined in Special Economic Zones (SEZ).

The move is aimed at stabilizing ticket prices for passengers and protecting airline margins amid ongoing volatility in global oil markets.