Now Reading: Centre notifies MMDR Act, states plan Supreme Court challenge
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Centre notifies MMDR Act, states plan Supreme Court challenge
The central government on Saturday notified the Mines and Minerals (Development and Regulation) Amendment Act, 2026, restricting states' powers to levy taxes on mineral rights and mineral-bearing lands. The act, passed in…
The central government on Saturday notified the Mines and Minerals (Development and Regulation) Amendment Act, 2026, restricting states' powers to levy taxes on mineral rights and mineral-bearing lands. The act, passed in the monsoon session, was gazetted on August 22.
Karnataka, Kerala and Telangana plan to challenge the legislation in the Supreme Court. The centre said states levy around 14 types of taxes on minerals, and some impose up to 20% tax on mineral-bearing lands, inflating input costs.
The government argued the act provides a stable tax structure to attract investment and reduce import reliance. Around 725 mineral blocks have been auctioned so far, with 105 operational.
Indian Opinion Analysis
The amendment reverses the July 2024 Supreme Court ruling that gave states the power to tax mining activities retrospectively. Mining states like Odisha, Jharkhand and Chhattisgarh stand to lose thousands of crores in annual revenue if the act is upheld. Karnataka and Telangana are among the highest mineral-bearing states, and their fiscal autonomy is now curtailed. The centre's argument on cascading taxes echoes industry concerns, but states see it as a federal overreach. The Supreme Court will decide whether Parliament can retroactively strip states of a tax power the court had affirmed. Watch for the listing of petitions in the coming weeks.
Source: thehindubusinessline.com
This story was synthesised by AI from the source linked above.
