The Centre-states tussle over the Mines and Minerals Bill, Pg12

Key Highlights:

• The Mines and Minerals (Development and Regulation) Amendment Bill, 2026 was passed in Parliament, sparking a Centre-state dispute.
• The Bill restricts states from imposing specific levies on mineral rights and mineral-bearing land.
• This move aims to counter state-level taxation that followed the Supreme Court’s 2024 ruling upholding states' power to tax mineral rights.
• States like Jharkhand and Kerala have opposed the amendments, citing potential revenue loss and concerns over India's federal structure.

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Detailed Insights:

• The amendments seek to address what the Centre perceives as excessive cess and other levies imposed by some states.
• The Bill will extinguish unpaid or unrecovered dues from such levies imposed before its enactment, estimated at around Rs 2 lakh crore.
• The Centre argues that unchecked state levies could increase the cost of key minerals, contributing to inflation and infrastructure costs.
• The Supreme Court’s 2024 ruling had overruled the 1989 India Cement Ltd v. State of Tamil Nadu judgment.
• The 1989 ruling had held that royalty was a tax and states lacked legislative competence as the subject falls under the Union List.
• Jharkhand Chief Minister Hemant Soren stated that mining revenue accounts for approximately 84.9% of the state’s non-tax revenue in 2024-25.
• The Mineral Bearing Land Cess alone was projected to generate around Rs 11,000 crore annually for Jharkhand.
• Industry experts believe the amendments will provide fiscal certainty for mining companies by preventing multiple and excessive levies.
• Existing levies such as royalty, District Mineral Foundation contributions, and National Mineral Exploration Trust contributions will remain.

Key Concepts Involved:

• Mines and Minerals (Development and Regulation) Amendment Bill, 2026: Legislation restricting states from imposing certain levies on mineral rights and land.
• Federal Structure: A system of governance where power is constitutionally divided between a central authority and constituent political units.
• Union List: A list in the Seventh Schedule of the Indian Constitution detailing subjects on which only the Parliament can legislate.
• District Mineral Foundation: A non-profit trust established in mining-affected districts to work for the benefit of persons and areas affected by mining.
• National Mineral Exploration Trust: A non-profit body established to promote mineral exploration in India.