MMDRA Amendment Bill tabled in Lok Sabha: Why it matters
What's the story
The Mines and Minerals (Development and Regulation) Amendment Bill, 2026 (MMDRA Bill), was tabled in the Lok Sabha today. The proposed legislation seeks to regulate states' authority to impose taxes, cesses, or other levies on mining rights and mineral-bearing lands. Under the bill, the Indian government will have the power to set conditions for such impositions by states.
Legal context
Bill follows Supreme Court's 2024 ruling
The MMDRA Bill comes after a landmark 2024 Supreme Court ruling.
A nine-judge Constitution Bench had upheld states' authority to tax mineral rights, separately from the royalty payable under the MMDR Act.
The court clarified that royalty under the Mines and Minerals (Development and Regulation) Act isn't a tax and doesn't restrict states' legislative power to levy taxes on mineral rights.
Proposed changes
Key provisions of the MMDRA Bill
The MMDRA Bill aims to provide a legislative framework for imposing restrictions on states' power to tax mineral rights.
It also proposes the cancellation of pending tax demands under earlier provisions, including those not yet recovered.
Additionally, the bill suggests a review of rules governing cess levied on the mining sector.
Clarity sought
Bill addresses state-level taxes and levies
The proposed legislation seeks to clarify the framework for future state-level taxes and levies on mining. It also addresses certain demands arising under existing provisions.
The 2024 SC judgment had settled a long-standing debate over whether royalty on minerals could be considered a tax and if states could impose additional levies on mineral rights.