STT collections surge in buoyant market;
Buoyancy in the stock markets has helped the government collect a record amount from the securities transaction tax (STT) in 2017-18.
According to an official with the income tax (I-T) department, the STT collection for the fiscal year stood at Rs 111.23 billion, an increase of 24 percent over 2016-17. The amount is also 43 percent higher than the Revised Estimates of Rs 77.7 billion.
Introduced in 2004, the STT is levied on all stock market transactions. The tax is in the range of 0.017 percent and 0.125 percent of the transaction amount.
The increase in STT collection is because of a high trading turnover, particularly in the derivatives segment. Derivative volumes on the National Stock Exchange (NSE) jumped 75 percent in 2017-18 over the previous fiscal year. Combined cash volumes on the NSE and the BSE, too, rose 38 percent in 2017-18.
The market has largely been on the up move between April 2017 and January 2018. In the past two months, however, stocks have entered a correction mode. Despite the correction, trading turnover has been on the rise.
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