Kerala to oppose Centre's MMDR Act amendments restricting state powers on mineral taxes

Bengaluru: Kerala on Thursday said it would oppose politically and legally the Centre’s amendments to the Mines and Minerals (Development and Regulation) Act, 1957, arguing that the move to curb states’ powers to levy taxes and cess on mineral-bearing land would erode their constitutional powers and cause significant revenue losses.

Chief Minister VD Satheesan said the state would formally register its protest and explore legal remedies if the Centre moves to enforce the amended law.

Read more: Parliament passes MMDR Amendment Bill 2026 to boost critical mineral exploration


Both Houses of Parliament have passed the Mines and Minerals (Development and Regulation) Amendment Bill, 2026. A contentious provision in the legislation inserts a new Section 9D, restricting states from imposing any tax, cess or other levy on mineral rights or mineral-bearing land based on the quantity or value of minerals, royalty payable or any other such criteria, except subject to conditions or restrictions prescribed by the Centre.

The amendment also seeks to invalidate state levies imposed before its commencement but not yet deposited or recovered.

Satheesan described the provision as a “serious encroachment” on the constitutional powers of states and a threat to India’s federal structure.

Read more: Centre proposes to curb powers of states to tax minerals

“The Union government is seeking to expand its jurisdiction by defining land as mineral-bearing land,” Satheesan told reporters in Thiruvananthapuram after a cabinet meeting. He argued that land is a state subject under Entry 18 of the State List and that the Centre cannot use its powers over mineral development to override states’ legislative authority over land.

The dispute comes against the backdrop of a broader constitutional tussle over the fiscal powers of states in relation to mineral resources. While Parliament has powers over regulation of mines and mineral development under the Union List, states have traditionally exercised powers over land and imposed certain levies linked to mineral-bearing areas.

Satheesan also objected to the absence of an explicit exclusion for forests and coastal areas in the proposed framework, saying the Centre could potentially widen its jurisdiction over land falling within state domains.

Kerala plans to formally communicate its objections to the Centre and examine judicial options to challenge the provisions. The state government said the issue was not merely about revenue but also about preserving the division of powers between the Centre and states envisaged under the Constitution.

The Centre, meanwhile, has maintained that the amendments are aimed at bringing greater uniformity and certainty to the regulatory framework governing mineral resources and preventing overlapping levies.