India: Govt exempts 22% to 30% ethanol blended petrol from central excise duty

The Indian government has extended central excise duty exemptions to petrol blended with ethanol at various percentages, specifically for blends containing 22%, 25%, 27%, and 30% ethanol. This fiscal measure, detailed in official notifications from the Ministry of Finance, aims to incentivize the use of biofuels.

Fuel blends that conform to the Bureau of Indian Standards (BIS) specification IS 19850 will now qualify for a nil excise duty rate. The notifications outline precise composition rules for each blend level. For instance, 22% ethanol-blended petrol must consist of 78% motor spirit (petrol) and 22% ethanol, with appropriate taxes paid on both components.

Similar structural parameters and volume requirements apply to the higher percentage fuel mixtures. The "appropriate duties of excise" referenced in the notifications include duties leviable under the Central Excise Act, 1944, the Finance Act of 2018, the Finance Act of 2002, and the Agriculture Infrastructure and Development Cess introduced by the Finance Act of 2021.