Securities Transaction Tax (STT) is the 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 the case of intra-day transactions, 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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