MMDR Amendment Bill 2026: Limits on State Mineral Taxes
Why in the news
A Bill in Parliament seeks one national tax framework for mining and aims to curb differing state levies on minerals.
Key facts
- Bill: Mines and Minerals (Development and Regulation) Amendment Bill, 2026, amending the MMDR Act, 1957.
- Aim: a uniform, Centre-directed fiscal framework; stop multiple, cascading state levies.
- Trigger: the Supreme Court’s 2024 nine-judge Constitution Bench verdict in Mineral Area Development Authority (MADA) v. SAIL, which upheld states’ power to tax mineral rights and lands and held that royalty is not a tax.
| Provision | Effect |
|---|---|
| Section 2 amendment | Central regulation extends to mineral-bearing lands |
| New Section 9D | States cannot levy tax, cess or levy on mineral rights or lands (by quantity, value or royalty) except within central conditions |
| Retrospective invalidation | Unpaid or unrecovered earlier state dues are deemed invalid |
| No refunds | Amounts already paid by mining companies are not returned |
| Section 13 | Centre may frame executive rules setting parameters, conditions and ceilings |
Concerns
- Section 9D keeps the state power to tax but makes it depend on central permission.
- The Bill names no ceilings; real limits will appear later through rules, not legislation.
Exam angle
- Key sections: 2, 9D and 13.