Star Cement: MMDR 2026 ends mineral cess burden

What Star Cement said, and why it matters

Star Cement has stated it is no longer required to pay mineral cess following the MMDR Amendment Act 2026. The development is tied to a wider regulatory change that restricts state governments from imposing certain levies on mineral rights and mineral-bearing land. For mining and mineral-linked industries, the change matters because it alters what taxes or cesses states can impose going forward. It also changes the treatment of dues that were levied earlier but not collected. The clarification is especially relevant for companies that source key inputs such as limestone. For the cement industry, regulatory costs on limestone can directly influence input costs.

Relief for Tamil Nadu cement makers as MBLT ends

Cement makers in the South, particularly those focused on Tamil Nadu, have welcomed the cessation of the Mineral Bearing Land Tax (MBLT) in the state. The MBLT was set at Rs 160 per tonne of limestone, and limestone is a key raw material for cement production. The Tamil Nadu government imposed this tax with effect from April 4, 2025. The end of this levy is described as being in line with the MMDR Amendment Bill, 2026, passed by both Houses of Parliament on August 13, 2026. The article links the withdrawal to the new central framework that limits how states can impose such charges. The cost relief is framed as particularly important amid elevated global crude oil and fuel prices.

What Parliament passed on August 12-13, 2026

The Mines and Minerals (Development and Regulation) Amendment Bill, 2026, cleared Parliament in mid-August 2026. The Rajya Sabha passed the amendment on August 12, 2026, and Parliament passed the Bill on August 13, 2026. The article also notes that the Bill was passed in the Lok Sabha in under 10 minutes without discussion. The amendment is positioned as an effort to bring long-term stability to the major minerals sector. It seeks to curb a complex tax regime that had made mining commercially unviable, according to the context provided.

The core change: restrictions on state-level levies

A key feature is the restriction on levies by states. The Bill prohibits a state government from imposing specified levies except in accordance with conditions or restrictions prescribed by the central government. This restriction applies to any tax, cess, or other levy on mineral rights or mineral-bearing lands, whether the charge is based on mineral quantity, mineral value, royalty, or any other basis. The text repeats that states cannot levy fresh taxes on mineral rights and mineral-bearing lands except within conditions prescribed by the Centre. For companies, the practical outcome is that certain state-imposed mineral-related charges may no longer be payable unless they fall within centrally prescribed conditions.

New Section 9D and the treatment of past dues

The amendment inserts Section 9D into the MMDR Act, 1957. Section 9D states that no tax, cess, or other levy, by whatever name called, shall be imposed by a state government on mineral rights or mineral-bearing lands. It explicitly covers levies computed on mineral quantity, mineral value, royalty payable, or otherwise. Such levies may be imposed only as per conditions or restrictions prescribed by the Central Government. The amendment also sets out how past levies are handled. Any levy not deposited with or recovered by a state before commencement will be treated as invalid. However, amounts already deposited or recovered before commencement will not be refunded.

What remains with states: minor minerals and existing collections

The amendment is described as not taking away states' rights over land and minerals or taxes on minerals already collected by them. The article states that around 90% of total taxes and statutory payments from mining currently accrue to the states, and that this arrangement will continue. It also says the amendment does not affect the power of states to regulate and impose taxes on minor minerals. States retain authority over these minerals as before. Union Minister for Coal and Mines G. Kishan Reddy is cited as saying states would retain rights over 49 minor minerals. The distinction between major minerals and minor minerals is central to how the change is expected to operate.

Major minerals and the defined state list mentioned

According to the article, the amendment covers only major minerals such as coal, lignite, iron ore, graphite, cobalt, lithium, and nickel. It also references a defined list of major minerals in eleven states. The states named are Andhra Pradesh, Chhattisgarh, Gujarat, Jharkhand, Karnataka, Madhya Pradesh, Odisha, Rajasthan, Uttar Pradesh, Goa, and one more implied by the count but not explicitly listed beyond those named in the provided text. The law is stated to apply retrospectively in the sense that uncollected state levies from before the amendment takes effect are invalidated. At the same time, already collected amounts are protected from being reversed.

Key facts at a glance

Market impact: cost lines and regulatory certainty

The immediate market relevance in the article is cost relief where levies such as the MBLT applied to a key input like limestone. At Rs 160 per tonne, any state-level levy on limestone can materially influence input economics for cement makers. The change is also presented as a broader shift toward regulatory stability for major minerals by limiting overlapping state levies. The retrospective invalidation of uncollected dues reduces the risk of companies facing demands for unpaid, older state levies that were not recovered before the amendment commenced. At the same time, the protection of already collected amounts indicates there is no automatic rollback of historical payments.

Analysis: why Section 9D is a material regulatory shift

Section 9D matters because it narrows the scope for states to impose taxes, cesses, or similar charges on mineral rights and mineral-bearing lands, unless permitted under centrally prescribed conditions. The article notes that this change created significant political uproar because it reduces states’ independent ability to tax minerals, while preserving their role on minor minerals. It also draws a clear line on the treatment of legacy disputes by invalidating unpaid or unrecovered dues, while keeping previously collected amounts intact. In practical terms, companies will likely track central rules under the amended Section 13 as the Centre frames conditions for any permissible state levies. For investors, the change is most relevant where mineral-linked taxes were a meaningful operating cost or a recurring source of regulatory uncertainty.

Conclusion: what to watch next

Star Cement’s statement reflects how companies are beginning to interpret the MMDR Amendment Act 2026 in their own compliance and cost structures. For cement makers, the withdrawal of the Rs 160-per-tonne MBLT on limestone in Tamil Nadu is a clear near-term relief item cited in the article. The next practical step will be how rules are framed under the amended Section 13, which enables the Centre to prescribe conditions under which states may impose any such charges. Stakeholders will also watch for how states apply the new framework across minerals and how companies disclose the impact in future updates.