Now Reading: Centre’s MMDR Bill curbs state mineral taxes, sparks federalism debate
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Centre’s MMDR Bill curbs state mineral taxes, sparks federalism debate
The Union government on Monday introduced the Mines and Minerals (Development and Regulation) Amendment Bill, 2026 in Lok Sabha, seeking to bar states from imposing additional taxes, cesses or levies on mineral…
The Story in Brief
The Union government on Monday introduced the Mines and Minerals (Development and Regulation) Amendment Bill, 2026 in Lok Sabha, seeking to bar states from imposing additional taxes, cesses or levies on mineral rights. The Bill would give the Centre tighter control over mineral-bearing lands, including royalty parameters. This directly contradicts a 2024 Supreme Court judgment that upheld states' power to tax mines and minerals. Mineral-rich states face significant revenue loss, with royalty collections rising from ₹9,695.88 crore in 2016-17 to ₹38,840.48 crore in 2021-22. The Centre argues the Bill will boost investor confidence and reduce dependence on imported critical minerals. States may challenge the law in court.
The Indian Opinion
The narrative that this Bill will purely catalyse investment ignores the real tension with cooperative federalism. States have a legitimate case after the 2024 Supreme Court verdict. But the Centre's claim of sovereignty over minerals is constitutionally sound. The real test will be whether mineral-rich states like Odisha and Jharkhand file a constitutional challenge, or negotiate a revenue-sharing formula.
Source: energy.economictimes.indiatimes.com
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