3 weeks ago
India Bill Bars States From Taxing Mines and Mineral Rights
India's government wants to change a rule about digging for rocks and minerals.
Some states were charging extra taxes on land that contains minerals.
The central government says this makes mining too expensive.
So it wrote a new bill that stops states from charging these taxes.
Now only the central government can decide about these taxes.
The bill was brought to the Lok Sabha, where India's lawmakers meet.
Some lawmakers from the opposition did not like the bill and protested.
They said it takes away power from the states.
The government says the change will help mining companies invest more and keep things predictable.
If a state already collected such taxes before the new rule, it does not have to give the money back.
The Mines and Minerals (Development and Regulation) Amendment Bill, 2026 was introduced in the Lok Sabha on Monday by Union Coal and Mines Minister G Kishan Reddy.
The bill bars states from imposing any tax, cess, or other levy on mineral rights or mineral-bearing lands, except under conditions prescribed by the Central Government.
It inserts new Section 9D in the MMDR Act and extends the Centre's regulatory control to mineral-bearing land defined by central parameters.
The proposal follows the Supreme Court's July 25, 2024 ruling affirming states' rights to tax mines and minerals, holding that royalty was not a tax.
Opposition members protested; RSP MP NK Premachandran said the bill violates federalism, while the bill clarifies that levies already collected will not be refunded.
- Who
- The Government of India, with Union Minister of Coal and Mines G Kishan Reddy introducing the bill; opposition members, including RSP MP NK Premachandran, protested against it.
- What
- Introduction of the Mines and Minerals (Development and Regulation) Amendment Bill, 2026, which bars states from imposing taxes, cess, or levies on mineral rights and mineral-bearing lands and gives the Centre greater regulatory control.
- Where
- Lok Sabha, India's Parliament.
- When
- Monday, when the bill was placed in the Lok Sabha; the proposal follows the Supreme Court's July 25, 2024 ruling on states' taxing powers.
- Why
- To reduce the financial burden on mining operations, make them commercially attractive for investment, and provide certainty, stability, and predictability in the mineral sector's fiscal regime.
States' Rights
Central Control
Mineral taxation authority
States' Rights
States should keep the right, affirmed by the Supreme Court on July 25, 2024, to tax mines and minerals since royalty is not a tax; RSP MP NK Premachandran said the bill is against the principles of federalism.
Central Control
State-imposed taxes, cesses, and levies burden mining operations and reduce commercial attractiveness; a single central framework will reduce financial burden, boost investment, and provide certainty, stability, and predictability.
Regulation of mineral-bearing land
States' Rights
The Supreme Court ruling and federal principles support states' control over land-related levies, which is why opposition members protested the bill's introduction.
Central Control
The legal distinction between mining activity and the underlying land leaves room for varying state interpretations, so the Centre needs explicit regulatory control over mineral-bearing land, which the bill defines by central parameters.
Key facts
- Bill
- Mines and Minerals (Development and Regulation) Amendment Bill, 2026
- Introduced by
- G Kishan Reddy, Union Minister of Coal and Mines
- House
- Lok Sabha
- Key provision
- New Section 9D in the MMDR Act barring state taxes, cess, or levies on mineral rights and mineral-bearing lands, subject to conditions prescribed by the Central Government
- Legal backdrop
- Supreme Court ruling of July 25, 2024 affirmed states' power to tax mines and minerals, holding that royalty is not a tax
- Grandfathering clause
- Levies paid to or collected by states before the provisions take effect will not be refunded
- Government rationale
- Reduce financial burden on mining, make it commercially attractive for investment, and provide certainty, stability, and predictability in the fiscal regime
- Opposition reaction
- Opposition members protested; RSP MP NK Premachandran said the bill is against the principles of federalism
Quotes
NK Premachandran
Revolutionary Socialist Party MP
“no tax, cess or such other levy shall be imposed by the State Government on mineral rights or mineral bearing lands, except in accordance with such conditions or restrictions as may be prescribed by the Central Government.”
telegraphindia.com
“The amendments seek to provide certainty, stability and predictability in the fiscal regime in the mineral sector”
scroll.in
Supreme Court
Supreme Court ruling
“The court held that the royalty collected by state governments under Section 9 of the 1957 Mines and Minerals Development & Regulation Act is not a tax”
scroll.in
Sources
Related news
India Bill Bars States From Taxing Mineral Rights and Land
Centre Bars States From Levying Taxes on Mineral Rights
Parliament passes Minerals Bill barring state taxes on mineral leases
India's mining tax overhaul reignites Centre-state tussle over revenue
Mineral Rights Amendment Bill Sparks States' Revenue Concerns
Rajya Sabha Passes Amendment Bill Curbing States' Mineral Taxes
Two Years After RG Kar Doctor's Rape-Murder, Case Remains Unresolved
ED widens Chhattisgarh probes with two arrests and searches
Delhi High Court Orders Madhya Pradesh to Pay Advocate Dues
Haryana sanitation workers’ strike puts BJP government under pressure
Orissa High Court Says Brothel Customers Cannot Face Trafficking Charges
