MMDR Amendment Brings Cost Relief to Tamil Nadu Cement Manufacturers

Cement manufacturers across the South, particularly those operating in Tamil Nadu, have received significant cost relief following the cessation of the Mineral Bearing Land Tax on limestone in the state.

The relief comes following the passage of the MMDR Amendment Bill, 2026, which was cleared by both Houses of Parliament on August 13, 2026. The legislation amends the Mines and Minerals (Development and Regulation) Act, 1957, with the primary objective of establishing long-term stability across the major minerals sector.

The Tamil Nadu government had earlier imposed the Mineral Bearing Land Tax at a rate of Rs 160 per tonne of limestone, effective from April 4, 2025. The withdrawal of this levy on limestone, an essential raw material for cement manufacturing, provides critical cost savings for producers who have been managing pressures from elevated global crude oil and fuel prices.

The statutory changes under the amendment preserve key financial and regulatory powers of the states. The amendment does not take away states' rights over land and minerals, nor does it affect taxes on minerals already collected by state administrations. Currently, around 90 percent of total taxes and statutory payments generated from mining accrue directly to the states, an arrangement that will remain in place.

Additionally, the amendment leaves the power of state governments to regulate and impose taxes on minor minerals completely intact, allowing state authority over those resources to continue as before.