Mining industry in India is still the highest taxed in the world despite the government's decision to slash corporate tax rate, mining body FIMI said on Monday.
While addressing the media here, FIMI Vice President Rajib Lochan Mohanty said there was a need for rationalising the taxation structure in mining sector for sustainable development and deriving long-term benefits in terms of sustained raw material security for industries.
"The government needs to realise that the taxation regime for mining in India affects all downstream industries and employment opportunities in the economy, while fuelling the already skewed balance of payment through additional import of minerals," Mohanty said.
Now, the effective tax rate in India works out to be 58 per cent for existing mines and 54 per cent for new mines granted through auction. These taxes include corporate tax, District Mineral Fund and National Mineral Exploration Trust, he explained.
All levies, payments to the government make domestic raw materials costly, resulting in costlier finished products in the economy and leading to import and reduced GDP in mining, he said.
Mohanty further said many of the existing private non-captive working mines will expire in March next year and it is apprehended that such blocks may not resume operations in next two-three years even after their successful auction.
"This Federation earnestly requests that the tenure of the non-captive mining leases (merchant mines) be extended till March 31, 2030.
There have been job losses of 12.8 lakh people--both direct and indirect -- in mining sector in Goa and Karnataka due to ineffective regulatory mechanism and subsequent adverse decisions by Supreme Court, Federation of Indian Mineral Industries (FIMI) said.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)