MMDR Amendment Bill aims to bring long-term stability to major minerals sector
New Delhi, August 16
The Mines and Minerals Amendment Bill, 2026, passed by both Houses of Parliament on August 13, aims to bring greater certainty and stability to India's major minerals sector by creating a more predictable fiscal regime and encouraging investment in domestic mining, the Ministry of Mines said in a press release.
The Ministry said the amendment does not take away any rights of states over land and minerals or their power to levy taxes on minerals, the ministry said. Around 90 per cent of the taxes and statutory payments from mining currently accrue to states, and this arrangement will continue under the amended framework. The amendment will also not affect states' powers to regulate and tax minor minerals.
The government said the changes are intended to provide certainty and predictability in the fiscal regime, which could give a boost to investment in mining and support the objectives of Aatmanirbhar Bharat and the vision of Viksit Bharat 2047.
The ministry highlighted the importance of domestic mineral production, noting that minerals are critical for infrastructure, manufacturing, energy security and broader economic development. India imported minerals worth Rs 10.12 lakh crore in FY26, and the government said steep and unbalanced taxation could make domestic minerals less competitive, prompting greater reliance on imports and increasing the burden on the exchequer.
States currently impose around 14 types of taxes, charges, fees and other levies on mining operations, including royalty, auction premium, dead rent, contributions to the District Mineral Foundation, GST and transit fees.
Between FY16 and FY26, major mining states received more than Rs 5 lakh crore from mining, while the Centre's revenue stood at Rs 82,000 crore, according to the ministry. This distribution of revenue, it said, will remain unchanged following the amendment.
The ministry also pointed to auction premiums as a major source of additional state revenue since the auction regime was introduced in 2015. Between FY21 and FY26, major mining states collected more than Rs 96,000 crore in auction premiums, over and above revenues from royalty, DMF and GST.
Given that mineral resources are finite and geographically concentrated in a limited number of states, the ministry said their management requires a cohesive national approach. It argued that uneven state-level taxation can raise domestic costs, weaken the competitiveness of locally available minerals and encourage imports despite the availability of domestic resources.
— ANI
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