In the Finance Bill of 2023, the following amendments were made in Finance Act (No 2) 2004 pertaining to Securities Transaction Tax (STT):
| A |
B |
C |
D |
| a |
Sale of an option in securities |
0.0625 per cent |
Seller |
| b |
Sale of an option in securities, where option is exercised |
0.125 per cent |
Purchaser |
| c |
Sale of a futures in securities |
0.01 per cent |
Seller |
- Value of taxable securities transaction relating to an "option in securities" shall be the option premium, in case of sale of an option in securities.
- Value of taxable securities transaction relating to an "option in securities" shall be the settlement price, in case of sale of an option in securities, where option is exercised.
The following procedure is adopted by the Exchange in respect of the calculation and collection of STT:
- STT is applicable on all sell transactions for both futures and option contracts.
- For the purpose of STT, each futures trade is valued at the actual traded price and option trade is valued at premium. On this value, the STT rate as prescribed is applied to determine the STT liability. In case of final exercise of an option contract STT is levied on settlement price on the day of exercise if the option contract is in the money.
- STT payable by the clearing member is the sum total of STT payable by all trading members clearing under him. The trading member's liability is the aggregate STT liability of clients trading through him.