Fuel taxes change from July 1: Here's what the government has revised

India has reduced the windfall tax on diesel and aviation turbine fuel (ATF) exports while increasing the export duty on petrol, according to a government order issued on Monday, according to a report by Reuters.

The revised tax rates will come into effect from July 1, following a sharp fall in global crude oil prices.

The duty on diesel exports has been cut to ₹8.5 per litre, down from ₹14 per litre. The export tax on aviation turbine fuel has also been reduced to ₹7.5 per litre from ₹12.5 per litre.

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At the same time, the government has increased the export duty on petrol to ₹4 per litre, up from ₹1.5 per litre, to ensure adequate domestic supplies.

New export duty rates

The revised export duties are:

Diesel: ₹8.5 per litre (earlier ₹14 per litre)
Aviation turbine fuel (ATF): ₹7.5 per litre (earlier ₹12.5 per litre)
Petrol: ₹4 per litre (earlier ₹1.5 per litre)

The new rates will apply from July 1.

Why the government changed the tax

The decision comes as global oil prices have fallen sharply from highs of more than $126 per barrel. Prices have eased after geopolitical tensions reduced and shipping through the Strait of Hormuz returned to normal, lowering concerns over prolonged supply disruptions.

Economists and analysts now expect Brent crude to average $84.50 per barrel in 2026, compared with the earlier forecast of $90.44 per barrel made last month.

When the export levy was first introduced, the government exempted exports of petrol, diesel and aviation turbine fuel made by public sector oil companies to Nepal, Bhutan, Bangladesh and Sri Lanka. The exemption continues.