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DMF / NMET mining levies
What it is
Two statutory contributions on top of royalty. The District Mineral Foundation, under Section 9B of the MMDR Act, takes 10% of royalty for leases granted after Jan 2015 and funds local development through PMKKKY; the National Mineral Exploration Trust takes 2% to fund exploration
Both are calculated as a percentage of royalty, which is itself a percentage of average sale price
Impact on industries
- Compounds the effective levy - royalty plus DMF plus NMET makes India's combined mineral take among the higher rates globally
- DMF funds are non-lapsable and directed at mining-affected districts, which buys the social licence that keeps operations running
- Utilisation has been patchy across districts, so the community benefit that justifies the levy is not always delivered
- Because both are royalty-linked, any royalty revision multiplies through all three levies at once