Lok Sabha passes bill to amend mines and minerals law without debate

The Lok Sabha on Wednesday passed the Mines and Minerals (Development and Regulation) Amendment Bill, 2026, without a debate, amid protests by opposition members.

The Bill, introduced by Coal and Mines Minister G Kishan Reddy, seeks to amend the Mines and Minerals (Development and Regulation) Act to prevent states from imposing additional taxes or levies on mineral rights.

It also proposes to bring the regulation of mineral-bearing lands containing mineral resources under the Centre’s control, based on parameters prescribed under the Act.


"This is in addition to the existing provision which declares the Union's control over the regulation of mines and the development of minerals," according to the Bill's Statement of Objects and Reasons.

The proposed amendments state that "no tax, cess or such other levy (by whatever name called) shall be imposed by the state government on mineral rights".

The restriction would also cover mineral-bearing lands, whether taxes or levies are based on mineral quantity, value, royalty or any other criteria, except under conditions or restrictions prescribed by the Centre. The Bill proposes inserting a new section in the MMDR Act for this purpose.

It further provides that any tax, cess or other levy that was not deposited with or recovered by a state government before the MMDR (Amendment) Act, 2026, comes into force would be deemed invalid.

"However, any such tax, cess or other levy on mineral rights or on mineral-bearing lands, already deposited with the state government or recovered by it before such commencement, shall not be liable to be refunded," the Bill said.

Reddy, citing the Statement of Objects and Reasons, said the proposed changes seek to bring greater certainty, stability and predictability to the fiscal regime governing the mineral sector. He said this would support national economic growth, the objectives of Atmanirbhar Bharat and the vision of a Viksit Bharat by 2047.

The minister said regional disparities in the fiscal burden on minerals could hurt public interest. He argued that steep and uneven taxes and levies could push the industry to bypass local supply chains, resulting in inefficient market development, higher transportation costs and increased pollution.

"There is also a risk of an increase in imports of minerals despite having sufficient local mineral resources as domestic mineral supply becomes expensive," the minister said.

Reddy also pointed to problems arising from the uneven taxation of mineral rights and mineral-bearing lands by state governments in the absence of reasonable limits.

"An excessive tax burden at the extraction stage or otherwise may ultimately increase the cost of goods and services and, consequently, the cost of living for the common citizen in the country. Further, any retrospective imposition of taxes would cause legal uncertainty and erode investors' trust," Reddy said.

RSP leader N K Premachandran opposed the introduction of the Bill, arguing that it was against the principles of federalism.

(With PTI inputs)