Special Additional Excise Duty (SAED)
the "Windfall Tax" Mechanism
SAED is the legal instrument through which India taxes windfall profits earned by energy companies from unusually high international crude oil prices or refining margins, rather than from operational efficiency.
- First imposed on 1 July 2022, when a surge in global crude prices following the Russia-Ukraine conflict inflated refiners' export margins; initial rates were ₹6/litre on petrol and ATF and ₹13/litre on diesel exports, plus a windfall tax on domestic crude production above a $75/barrel threshold.
- Levied under the Central Excise framework as an additional excise duty (distinct from the regular excise duty on fuel), applicable separately to (a) domestically produced crude oil and (b) exports of petrol, diesel, and ATF.
- Withdrawn on 2 December 2024 as international crude prices softened, then reintroduced on 26 March 2026 after renewed price volatility linked to Middle East tensions and disruptions to global crude trade.
- Rates are recalibrated roughly every fortnight by the Finance Ministry based on average international crude prices and refining "crack spreads" (the margin between a refined product's export price and the cost of the crude used to make it) over the preceding two weeks.
● Tracked since May 15, 2026 · last seen September 17, 2026 · updates as the daily brief publishes
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