ATF Tax Update: A very good news has come out for the Indian aviation sector. Indian Airlines have got a big relief after Delhi and Maharashtra governments reduced the tax on aviation fuel (ATF) to 7%. According to financial institution HSBC, this decision will lead to huge savings of up to ₹ 1,500 crore for airline companies. Along with this, the Maharashtra government has directly reduced the VAT on aviation fuel from 18% to 7%. This decision is very significant because airports like Delhi, Mumbai and Nagpur handle about 37% of the total domestic air traffic of the country.

Airlines will get big benefits

The country’s largest airline, IndiGo (InterGlobe Aviation) is going to get the biggest benefit of this tax cut. According to HSBC estimates, IndiGo can make direct savings of ₹ 1,200 crore to ₹ 1,500 crore in its fuel bill. Similarly, Air India will also get a huge relief of around ₹800 crore to ₹1,000 crore. Apart from this, Akasa Air with new fleet may save ₹200 crore to ₹300 crore and SpiceJet which is facing financial crisis may save ₹100 crore to ₹200 crore.

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Share Rating and Market Outlook

HSBC has maintained its ‘Buy’ rating on IndiGo shares and has set its target price at ₹5,210, which represents an upside of about 21% from its current price. On the other hand, considering the internal financial condition of SpiceJet, it has been given a ‘Reduce’ rating and its target price has been kept at ₹5.30. Market analysts are now waiting for IndiGo’s upcoming fourth quarter results and the ‘Analyst Day’ to be held in June, where the company will unveil its future plans.

Amidst its good news, HSBC has warned that even though the governments have reduced the taxes, but if the prices of crude oil increase in the international market or the Indian Rupee weakens against the dollar, then this relief may be less. For example, if jet fuel prices increase by even just 5% globally, IndiGo’s operating profit (EBITDA) could fall by 11.1%. Similarly, a fall of just Re 1 in the rupee against the dollar can give a blow of about ₹ 450 crore to IndiGo.

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India Petrol Tax Rate: Petrol and diesel are outside the scope of GST in India, hence every state decides VAT i.e. Value Added Tax accordingly. For this reason, there is a big difference in fuel prices across the country. At some places the tax is very low and at other places it is very high and this has a direct impact on the pockets of common users.

Which are the states with the highest tax on petrol?

The highest VAT on petrol in the country is imposed in Telangana, which is 35.20 percent and it is the highest in the whole of India. After this, higher tax rates are also seen in many states like…

• Andhra Pradesh: 31 percent + ₹4 per liter + Road Development Cess
• Kerala: 30.08 percent + ₹1 per liter + other cess
• Karnataka: 29.84 percent
• Rajasthan: 29.04 percent + road development cess
• Madhya Pradesh: 29 percent + ₹2.50 per liter + 1 percent cess
• Odisha: 28 percent
• Maharashtra: 25 percent + ₹5.12 per liter additional tax
• West Bengal: 25 percent + cess
• Manipur: 25 percent

Which are the medium tax states?

• Assam: 24.77 percent or ₹18.80 per liter
• Chhattisgarh: 24 percent + ₹2 per liter
• Bihar: 23.58 percent + surcharge
• Nagaland: 21.75 percent
• Goa: 21.5 percent + green cess
• Delhi: 19.40 percent
• Uttar Pradesh: 19.36 percent or ₹14.85 per liter
• Haryana: 18.20 percent + additional tax

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Which are the lowest tax states?

• Tamil Nadu: 13 percent + ₹11.52 per liter
• Gujarat: 13.7 percent + cess
• Arunachal Pradesh: 14.50 percent
• Lakshadweep: 10 percent
• Andaman and Nicobar: 1 percent (lowest in the country)

Big tax difference between states

There is a lot of difference in tax on petrol and diesel between states. The difference between the states with the highest and lowest VAT is more than 34 percent. This clearly means that if at some place the base price of petrol is Rs 100, then at some places the tax reaches Rs 35, while at some places it remains only around Rs 1.

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US-Iran War: There has been tension between Iran and America for a long time, but now the announcement of a two-week ceasefire between the two countries has created a stir in the global market. Due to the ongoing tension for a long time, the whole world was troubled by inflation and supply chain problems, but now this decision has raised hopes of relief. According to reports, as soon as the news of reducing tension between the two countries came out, its biggest and positive impact has been on the crude oil market. There has been a decline of 13 percent to 17 percent in the prices of crude oil in the international market.

Homurz Strait plays an important role in this development, which is considered the main route for the supply of about 20 percent of the world’s oil and LPG. There was a danger on this route due to tension with Iran, but now after the ceasefire, the hope that the situation will become normal has increased. Due to smooth supply, energy prices start falling, which will impact the global economy and will also benefit countries like India, which import most of the oil they need. They can get direct benefit from this.

There will be a decline in the prices of petrol and diesel

If we look from India’s perspective, the first relief can be seen in the prices of petrol and diesel. But the change in prices in India does not happen immediately, because oil companies also take into account taxes and past losses. If still, international prices remain low then relief may come in the next 7 to 10 days. Not only here but good news can also be received on the LPG front.

LPG had become expensive due to supply disruption due to the ongoing tension with Iran, due to which the prices of domestic and commercial cylinders increased, but looking at the latest situation, it seems that if imports become cheaper then the prices of domestic LPG cylinders may come down. Due to this, food items in hotels and dhabas can also become cheaper.

This stuff can be cheap!

• petrol and diesel
• Vegetables and Fruits
• cooking oil
• pulses
• food items
• smart fone
• laptop-pc
• TV
• refrigerator
• washing machine
• vehicles
• clothes coming from abroad

There may be change in the price of air tickets

This news can also be a relief for air passengers. Because due to low price of crude oil, Aviation Turbine Fuel (ATF) becomes cheaper, which is a major part of the cost of airlines. In such a situation, there is a high possibility that the prices of air tickets will reduce in the coming time. The fall in oil prices also affects the everyday life of common people. Due to cheaper diesel, transportation costs reduce, due to which vegetables, milk, grains and other essential goods can become cheaper. Apart from this, the cost of things like plastic, packaging, tires and synthetic clothes is also expected to reduce.

However, it is important to understand that the effect of these changes is not immediately visible. It may take 1 to 3 weeks for the supply chain to normalize and the new prices to be implemented. Also, this ceasefire is temporary at present. If this turns into permanent peace and the government also gives relief in tax, only then the general public will be able to get its full benefit.

LPG Cylinder Booking Tax: Due to increasing tension in the Middle East, gas supply is being seriously affected. Its direct impact is visible on the prices of LPG in India. Recently, the government had increased the prices of domestic and commercial gas cylinders, due to which people are facing a lot of problems, but in the meantime, the Chamber of Trade Industry (CTI) has written a letter to Prime Minister Narendra Modi demanding to make LPG and PNG tax-free.

CTI says that if the tax on these is removed, then the prices of gas will fall, due to which the common people can get a lot of relief.

At present, 5 percent GST is levied on domestic LPG cylinders, while up to 18 percent GST is levied on commercial cylinders. If we talk about PNG, it is not yet under the purview of GST and state governments levy VAT on it at different rates, which ranges from about 3 percent to 14.5 percent. For example, 5 percent VAT is applicable on PNG in Delhi.

LPG will be cheaper after GST is removed

Domestic LPG Cylinder: Currently its price in Delhi is Rs 913. After removal of GST, it will remain around Rs 870, i.e. it will be cheaper by around Rs 43.

Commercial Cylinder: Its price in Delhi is Rs 2078. After removal of GST, it will become approximately Rs 1760, i.e. there will be a saving of around Rs 318.

People will get relief by removing GST

CTI Chairman Brijesh Goyal has appealed to the government that tax relief should be given in view of the current circumstances. He believes that this will not only benefit the common consumers but will also provide relief to small businesses. Other officials of the organization say that due to the increasing crisis in West Asia, there has been instability in the global oil and gas market, due to which the demand in India has also increased.

Especially in Delhi, a rapid increase in the number of PNG connections has been seen. While in February 2026, about 686 new connections were being added every day, by March this figure increased to about 2000 every day. Overall, if the government gives tax exemption on LPG and PNG, it will provide great relief to the general public.

Due to the ongoing crisis in the Middle East, oil prices have increased worldwide. Meanwhile, Australian Prime Minister Anthony Albanese has made a big announcement of 50 percent reduction in fuel tax to control the rising prices of petrol and diesel in the country.

The Australian PM posted on social media and informed that this relief will be effective for the next three months i.e. till June 30, 2026. This decision has been taken in view of the rising price pressure in the domestic market due to foreign conflicts.

National Fuel Security Plan
The aim of the Albanese government is to save expenses for working people and parents who drop their children off to school. Along with this, the government has also released the National Fuel Security Plan, so that uninterrupted supply of fuel can be ensured in the states and regions. He said that his priority is to take care of people in an Australian way amid uncertain global circumstances.

Along with this, Anthony Albanese has warned that those involved in illegitimate profiteering in oil prices will not be spared. The government has talked about heavy fines against such elements. Albanese said that no excuse for increasing profits at the expense of the public would be accepted. Officials have been instructed to keep a close watch on the market.

Petrol and diesel will be cheaper till June 30
Prime Minister Anthony Albanese has requested people to buy only as much fuel as they need. He said that Australians always take care of each other and can help the society by exercising restraint at this time. Petrol and diesel will be cheaper till June 30.

Australia’s central government is working closely with the states to prevent any disruption in fuel supply. Through the National Fuel Security Plan, it will be ensured that fuel continues to reach the places where it is needed most. In a time of global uncertainty, the government has taken this concrete step for domestic security and public convenience.

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