The Finance Bill 2026 introduces an increase in Securities Transaction Tax (STT) rates on derivatives, specifically options and futures, effective from April 1, 2026, as under:
- Sale of options in securities: increased from 0.10% to 0.15% of the option
premium; - Sale of options where exercised: increased from 0.125% to 0.15% of the intrinsic
value; - Sale of futures in securities: increased from 0.02% to 0.05% of the traded price
Proposed increase in rates for STT is brought in to discourage F&O trading in the market as it adversely impacts trading costs and market liquidity, particularly affecting high-frequency and derivative traders.
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