New Delhi/Ranchi/Thiruvananthapuram: Parliament on Thursday passed the Mines and Minerals (Development and Regulation) Amendment Bill, 2026, that seeks to curb taxation of minerals by state governments, prompting a warning of a “massive agitation” by the chief minister of mineral-rich Jharkhand.
The bill, which amends the Mines and Minerals (Development and Regulation) Act, 1957, cleared Rajya Sabha after a truncated debate on the last day of the Monsoon session on Thursday, with Opposition MPs saying it infringes on states’ rights and curbs their fiscal autonomy. It was passed by the Lok Sabha, where it saw little debate , a day earlier. It will become law after receiving the President’s assent.
Responding to the debate in the Rajya Sabha, Union Mines Minister G Kishan Reddy said that the legislation standardizes national mineral rates without infringing on state autonomy or revenues. Under the bill, the Centre will regulate major minerals (coal, limestone, iron ore, copper, manganese), while states will retain control over 49 minor minerals, he said.
“Unbalanced imposition of steep taxes and levies will prompt the industry to completely bypass local supply lines, leading to sub-optimal development of markets, increased transportation costs and the resultant pollution load,” says the statement of objects and reasons of the bill.
{{/usCountry}}“Unbalanced imposition of steep taxes and levies will prompt the industry to completely bypass local supply lines, leading to sub-optimal development of markets, increased transportation costs and the resultant pollution load,” says the statement of objects and reasons of the bill.
{{/usCountry}}The bill was passed via voice vote after the House rejected an amendment by DMK’s Tiruchi Siva to refer it to a select committee. Chairman C P Radhakrishnan declined requests for a division of votes, saying it could not be taken up due the din caused by Opposition MPs protesting police action against students at Jantar Mantar and alleged Ram Temple donation thefts.
The amendment bill introduces a new section that says that “no tax, cess or such other levy (by whatever name called) shall be imposed by the state Government on mineral rights; or mineral bearing lands, either based on mineral quantity or mineral value or royalty payable…except in accordance with such conditions or restrictions as may be prescribed by the Central Government..”
The bill also proposes to expand the central government’s powers to regulate mines to mineral bearing lands having ore content in accordance with the parameters prescribed under the MMDR Act.
The proposed amendments are the fallout of a July 2024 ruling by the Supreme Court that upheld the power of states to levy taxes on mineral rights and and mineral-bearing lands. The verdict was hailed as a major fiscal victory for mineral-rich states such as Jharkhand, Odisha, Chhattisgarh and Rajasthan, potentially yielding a revenue windfall, but it deeply unsettled mining companies facing retrospective taxation.
The new section in the bill invalidates state levies that are uncollected or undeposited as of the amendment Act coming into force. Levies already deposited or collected would be not liable for refunds.
Hemant Soren, the chief minister of Jharkhand, which holds nearly 40% of India’s mineral reserves, said the amendment bill undermines the state’s rights over its mineral resources and entitlements. “The Centre passed it in haste, tying Jharkhand’s hands and feet. Jharkhand will launch such a massive agitation to oppose it that the entire nation would see,” Soren said in a post on X. Soren pointed out that the amendment bill will curb fiscal space for social welfare schemes, saying Jharkhand will have to stop all its programmes providing social security to millions.Soren said he has written to the President against the bill.
A week after the Supreme Court ruling, the Jharkhand assembly passed a bill which provided for varying degrees of tax on different minerals mined in the state on a per-metric-tonne basis. The Act was further amended in the 2025 budget session to increase the cess on mined minerals in the state by up to four times. Officials said the state government projected revenue of ₹14,656 crore from the Mineral Bearing Land Cess in the 2026-27 budget and had earmarked these funds for welfare schemes.
Kerala chief minister V.D. Satheesan said the amendment bill effectively transfers states’ rights and authority over land under Schedule 18 of the State List of the Constitution to the jurisdiction of the Union government, which was against federal principles.The legislation, by defining land as mineral-bearing, does not even exclude forests and coastal areas, he said.
In the debate in the Rajya Sabha, the mines minister cited Entry 54 of the Union List, which empowers Parliament to regulate mines and mineral development in public interest, and said taxation was an important tool for regulating and developing the sector. He said the Centre receives only about 11 per cent of mineral revenue, with 88 per cent going to states, and asserted that no state would suffer any revenue loss because of the amendments.
Biju Janata Dal (BJD) MP Manas Mangaraj while opposing the bill during the debate, said it raises concerns over states’ rights, fiscal autonomy and the interests of mining-affected communities. He said for a state like Odisha – which accounts for the largest share of India’s mineral output--revenue from mineral resources was crucial for funding healthcare, education, roads, rehabilitation and environmental restoration.
Congress MP Sasikanth Senthil, representing Tiruvallur in Tamil Nadu, who had on Monday written to the Lok Sabha speaker calling for the bill to be referred to the Department-related Parliamentary Standing Committee on Coal, Mines and Steel for a detailed scrutiny, slammed the way the bill was passed.
“I had written to the Hon’ble Speaker at the time of introduction of the Mines & Minerals Amendment Bill, 2026, urging its referral to the DRSC for detailed scrutiny. Instead, the Bill was rushed through Parliament with barely any meaningful debate. If Standing Committees, parliamentary scrutiny and debate can simply be bypassed, what exactly is Parliament being reduced to a rubber stamp?,” Senthil said on X.
(with inputs from PTI)