This amendment is the central government’s legislative answer to a 2024 Supreme Court ruling that let states levy their own taxes on mineral rights and mineral bearing land, and allowed them to recover such dues going back years. Mining companies faced very large retrospective demands from several mineral rich states, and the industry warned that project economics across steel, cement, aluminium and coal would be rewritten.
The Bill does three things. First, it widens the central government’s regulatory reach so that it covers mineral bearing land itself and not only mines and mineral development. Second, it bars state governments from imposing any tax, cess or other levy on mineral rights or mineral bearing land except in accordance with conditions or restrictions that the central government prescribes. Third, it deals with the past: state levies that were imposed before the Act commenced but have not actually been collected are treated as void, while amounts already recovered do not have to be refunded.
The practical effect is to shift the balance of fiscal power over mining decisively toward the Union. Mining states, several of which are among India’s poorer regions and had counted on this revenue, lose a source they had just won in court. The Bill passed the Lok Sabha without debate amid opposition protests.