Securities Transaction Tax (STT) is tax on the value of securities transacted through a recognized stock exchange. The tax is not applicable otherwise. STT was originally introduced by the then finance minister, Shri P. Chidambaram in 2004. STT for delivery based equity trading was 0.125% on the turnover which is now reduced to 0.1%. In case of intra-day transaction the rate is 0.025% on the turnover. In case of Futures and Options Transaction, the tax rate was 0.017% which is now reduced to 0.01% on the sell-side only.
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