India waives excise duty on petrol with higher ethanol

India's government is giving consumers a break by waiving excise duty on petrol. This move is tied to the increased use of ethanol blended into the fuel, encouraging a greener approach to transportation and potentially lowering prices at the pump ...

By ET Online | Updated: Jun 12, 2026, 12.03 PM IST

Higher ethanol blends beyond E20 unlikely for now amid vehicle compatibility concerns

India, the world's third-largest oil importer and consumer, on Wednesday abolished central excise duty on petrol blended with higher levels of ethanol.

A Ministry of Finance (Department of Revenue) notification extended central excise duty exemptions to petrol blended with 22%, 25%, 27%, and 30% ethanol. The nil excise duty rate will apply to all four blends, provided they conform to Bureau of Indian Standards specification IS 19850.

Also read: E85 fuel to sell at Rs 20/litre discount to drive ethanol adoption: Oil Minister Hardeep Singh Puri

The notification, issued under the Central Excise Act, 1944, amends an earlier government notification from June 30, 2017. It adds new entries — 5E, 5F, 5G, and 5H — to the existing table under that notification, covering blends of 78%, 75%, 73%, and 70% motor spirit mixed with 22%, 25%, 27%, and 30% ethanol, respectively.

For each blend, the exemption applies on the condition that appropriate duties of excise, Central tax, State tax, Union territory tax, or Integrated tax have been paid on the ethanol used.