Centre hikes petrol export tax to ₹3.5 from ₹2.5 in response to Iran conflict

Why in news

The Centre hiked windfall taxes on fuel exports to manage domestic supply and price volatility triggered by the Iran conflict.

Background

The export duty on petrol increased from ₹2.5 to ₹3.5 per litre. Diesel export duty rose from ₹15.5 to ₹25.5 per litre, and Aviation Turbine Fuel (ATF) rose from ₹14.5 to ₹22 per litre.

Facts for Prelims

• FactPetrol export duty hike: ₹2.5 to ₹3.5 per litre
• FactDiesel export duty hike: ₹15.5 to ₹25.5 per litre
• FactATF export duty hike: ₹14.5 to ₹22 per litre
• BodyWindfall tax is a levy on 'excess' profits from commodities like oil and coal.

For Mains

Q. Discuss the role of fiscal instruments like windfall taxes in ensuring energy security and stabilizing domestic markets during global geopolitical conflicts.

Dimensions to cover in your answer

• Energy security
• Fiscal policy as a stabilizer
• Impact of geopolitical volatility on domestic inflation

Keywords: Windfall tax · Energy security · Fiscal policy · Market volatility · Supply-side management

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