Date | Jun 19, 2015:
Even though the amended Mines and Minerals (Development and Regulation) Amendment Act was notified three months ago, the Centre is yet to prescribe miners’ contribution towards the proposed district mineral foundations (DMF).
While mining industry, already reeling under heavy tax burden, wants the DMF outgo to be minimal, states have been demanding a robust DMF fund as they would need more money to support the project-affected people.
Under the Act, miners of iron ore, bauxite, limestone and manganese ore will be required to pay up to 100% of the royalty on the mineral as their contribution towards the DMF, meant to support the project-affected people.
On other hand, the DMF outgo on firms that would get fresh mining lease (through the auction route) will not exceed 33% of the royalty. The Centre, however, has a discretion to decide the exact quantum of payment towards DMF.
Revisable every three years, the royalty on iron ore was raised to 15% from 10% in August last year. With the higher royalty — the new DMF impost of 2% National Mineral Exploration Trust levy — the burden on miners will only rise.
“While we do not want to miss on the opportunity to give more to the project-affected people, we also do not want to put excessive burden on miners and create a situation where mining become more strenuous. We are trying to strike a balance,” said a mines ministry official.
He, however, exuded confidence rates would be fixed soon. Consultation with the states on the issue is over, he added.
Industry has made several representation to the ministry urging it to keep the rate as minimum as possible as paying an equal outgo on the royalty would make mining unviable for many players.
(Source: http://www.financialexpress.com/)