No Change in Coal Royalty Rate, Confirms Central Government

The Central government has indicated that it will not revise the existing 14% ad-valorem coal royalty rate. This decision, confirmed by Minister of Coal and Mines G. Kishan Reddy, supports maintaining domestic coal's competitiveness and aligns with a 2014 Study Group recommendation.

The Central government, represented by Minister of Coal and Mines G. Kishan Reddy, has informed the Rajya Sabha that it has no plans to alter the current 14% ad-valorem rate of royalty on coal. This announcement came in response to a question from Rajya Sabha member Sasmit Patra regarding Odisha's coal royalty.

The current royalty rate, calculated based on the coal's invoice price minus taxes and other charges, ensures increasing state collections with the rise in coal prices, according to the minister. This system helps states benefit from any uptick in coal prices.

The minister highlighted that raising the royalty rate could disadvantage domestic coal against imported alternatives. He also noted that a Study Group's 2014 recommendation against raising the coal royalty rate was approved by the government, reinforcing the decision to maintain the status quo.

(With inputs from agencies.)