The MCA branch in Victoria warned that without urgent policy changes, the mining sector would languish without fresh investment from the private sector.
The mining industry is not identified as a "priority sector" by the Victorian government.
MCA also claimed the state's Earth Resources department was underfunded.
The industry body outlined five areas for change ahead of the next state budget.
Adding the minerals industry to the priority sector list and properly funding the resources department and regulator were two pragmatic changes proposed.
The MCA also demanded the Victorian government reintroduce a co-funded exploration drilling initiative, something most other states offer to encourage exploration activities.
MCA state director James Sorahan noted gold, base metals and mineral sand explorers invested a record high $220 million in exploration in 2021.
"Victoria needs to give investors the confidence that record spending on exploration can lead to new mines with the support of the community," Sorahan said.
In Western Australia, South Australia and Queensland, their respective co-funding grants return significant economic benefits for state economies.
Victoria scrapped its program in 2019.
Other financial measures the state could make to encourage investment and project development included changing the gold royalty scheme and reinvesting royalties to properly fund Earth Resources.
"Reform to Victoria's flawed gold royalty, which was imposed in 2020 with no consultation, will be required to ensure the uncompetitive royalty does not result in mines closing in times of lower gold prices," Sorahan said.
More immediate short-term incentives for industry include improving approvals timeframes and giving companies more time to conduct exploration activities on their licences.
Delays in approvals to site works and work plans due to time-consuming referrals to different bureaucratic agencies within the state government are costing explorers and project developers, according to the MCA.
Removing some of this red tape, including duplication of paperwork and other inefficacies have been done by WA's and Queensland's governments, but not Victoria's.
There is also a need to change exploration licence terms, which stipulate a licence is relinquished if all work program activities are not completed within a certain time frame.
The MCA called it an ineffective and blunt instrument designed to speed up exploration spending rather than improve exploration programs.
"The compulsory relinquishment requirements and short licence periods do reflect Victoria's geological characteristics and approvals process timeframes," Sorahan said.
