Politics
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Lok Sabha curbs state taxes on mineral land
ThePrint··13 Aug
The Lok Sabha on August 12 passed the Mines and Minerals Amendment Bill 2026, restricting states from levying tax or cess on mineral rights and mineral-bearing land except on conditions the Centre prescribes. Coal and Mines Minister G Kishan Reddy moved the Bill, passed without debate amid opposition protests. Unrecovered state levies would be deemed invalid once the Act begins.
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What It Means For You
- If you live in a mineral-rich state, this Bill would limit new state taxes on mineral rights unless they fit conditions the Centre later notifies.
- Mining companies and PSUs can note that unpaid or unrecovered state levies would be treated as invalid from commencement, while money already paid stays with the state.
- State budget watchers in Karnataka, Jharkhand and Tamil Nadu can recall those states had moved fresh mining taxes after the 2024 Supreme Court verdict.
What's Happening
- On August 12 the Lok Sabha passed the MMDR Amendment Bill 2026 by voice vote without a debate, amid opposition protests.
- Section 9D would bar state tax, cess or similar levies on mineral rights and mineral-bearing land except under Central conditions or restrictions.
- Any such levy not deposited with or recovered by a state before the amendment begins would be deemed invalid at all material times.
Why 2024 Court Ruling Triggered This Bill
- A nine-judge Supreme Court bench in 2024 held that states could levy tax on mineral rights under Entries 49 and 50 of the State List, separate from MMDR royalty.
- The 1957 MMDR Act already declared Union control over mines and mineral development; the 2026 Bill adds mineral-bearing land defined by Central parameters.
- RSP MP Premachandran N K told reporters that tax on land and buildings is a state subject and argued the restriction cannot be done without a constitutional amendment.
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