New Delhi, Aug 13 — The recently enacted Mines and Minerals (Development and Regulation) Amendment Bill, 2026 will modernise India's mineral governance, strengthen mineral exploration, critical mineral security and sustainable resource development through a stable and uniform fiscal regime, an official factsheet said on Thursday.
The bill would restrict state governments from imposing new taxes on mineral rights and mineral‑bearing lands without conditions prescribed by the Central government, a statement said.
The bill, which has been passed by both houses of Parliament, addressed a heavy and unpredictable tax burden that had made mining commercially unviable in several instances and discouraged extraction.
“No tax, cess or other levy, by whatever name called, shall be imposed by a State Government on mineral rights or mineral-bearing lands. This covers levies based on mineral quantity, mineral value, royalty or any other basis,” the statement said.
Any levy not paid or collected by the State before the Amendment applies will be treated as invalid. However, amounts already deposited or recovered before such commencement shall not be liable to be refunded.
The legislation curbs the unpredictable introduction of taxes, cesses and other levies after operations have commenced.
Further, it addresses the problem of multiple levies on production or dispatch of minerals; non‑uniform rates among states; and retrospective imposition of charges.
Additional and unpredictable costs affected small and medium-scale mining operators disproportionately. High and uneven levies pushed industries to avoid local supply chains, creating weaker markets, higher transport costs, and more pollution.
Costlier domestic supply also created a risk of higher mineral imports, despite sufficient local mineral resources.
Multiple and inconsistent taxes caused a cascading tax effect and high compliance costs, slowing down economic growth.
An excessive tax burden at the extraction stage ultimately raises the cost of goods and services for the common citizen.