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Informist, Wednesday, Aug. 12, 2026

 

NEW DELHI – The Lok Sabha Wednesday passed the Mines and Minerals (Development and Regulation) Amendment Bill, 2026, which allows shifting of the regulation of mines and mineral-rich lands to the Centre from the states. The bill curbs the power of states to levy tax, cess, or any other duty on mineral-bearing lands. The aim is to ease the financial costs of investing in the industry and to improve the investment climate in the country.

 

The bill was tabled by Coal and Mines Minister G. Kishan Reddy and passed by the Lower House without discussion amid a din. "No tax, cess or such other levy (by whatever name called) shall be imposed by the State Government on (a) mineral rights; or (b) mineral bearing lands, either based on mineral quantity or mineral value or royalty payable or otherwise, except in accordance with such conditions or restrictions as may be prescribed by the Central Government," as per the bill.

 

According to the government, excessive fiscal burden makes mining operations commercially unviable, discourages mineral extraction, adversely affects mineral production and, in some cases, leads to closure of mines. "Any additional and unpredictable costs disproportionately may lead to adverse impact on small and medium-scale mining operators," it said.

 

The amendment can dent states' revenues--especially for mineral-rich states like Odisha, which collect a significant amount of taxes as royalty, fees, and taxes on mines and minerals activity.

 

"Mineral resources are finite and concentrated in a few States, and their extraction and management have to be guided by long-term national goals of sustainable, equitable and uniform development integrated into the overall strategy of the country's economic development," as per the bill. "Any regional disparity in fiscal impositions on minerals impacts public interest."

 

As per the government, unbalanced imposition of steep taxes and levies will prompt industry to bypass local supply lines, leading to sub-optimal development of markets, increased transportation costs, and the resultant pollution load. "There is also a risk of an increase in imports of minerals despite having sufficient local mineral resources as domestic mineral supply becomes expensive," it said. 

 

"The above amendments strive to provide certainty, stability, and predictability in the fiscal regime in the mineral sector, thereby giving impetus to national economic growth which would facilitate the aims of Atmanirbhar Bharat and ultimately attaining the vision of Viksit Bharat 2047," the government said.  End

 

Reported by Astha Oriel and Priyasmita Dutta

Edited by Rajeev Pai

 

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