What does STT mean in STOCK EXCHANGE
Securities Transaction Tax (STT) is an Indian financial market tax imposed by the Government of India on all transactions done in the secondary (or trading) market, which includes both equity and debt instruments. It is applicable on transactions between buyers and sellers in the stock market. STT came into force with effect from October 1, 2004 after the Finance Act, 2004 was passed by the Parliament of India. The main objective behind introducing this tax is to encourage people to invest in long-term investments instead of short term ones. The rate of STT varies based on several factors such as nature of security, type of transaction and mode of transfer.
STT meaning in Stock Exchange in Business
STT mostly used in an acronym Stock Exchange in Category Business that means Securities Transaction Tax
Shorthand: STT,
Full Form: Securities Transaction Tax
For more information of "Securities Transaction Tax", see the section below.
Essential Questions and Answers on Securities Transaction Tax in "BUSINESS»STOCKEXCHANGE"
What is Securities Transaction Tax?
Securities Transaction Tax (STT) is a tax imposed by the government of India on all transactions carried out on a recognized stock exchange. It is paid by both buyer and seller of the security at the time of its purchase or sale, respectively. STT helps in promoting the overall market efficiency and liquidity.
Who pays the Securities Transaction Tax?
Both buyers and sellers are liable for paying STT at the time of purchase or sale of securities.
How much do you need to pay as Securities Transaction Tax?
The amount payable as STT depends on what type of transaction is being conducted – whether it's equity delivery trading, intraday trading or futures & options trading. Equity delivery trading attracts 0.1%, intraday trades attract 0.025% and futures & options attract 0.05%.
Is there any exemption from paying Securities Transaction Tax?
Yes, transactions between family members are exempt from STT. Additionally, certain types of transactions as prescribed under exempt list issued by Government of India are also not subject to payment of STT.
Where can I find an up-to-date list of exempted securities from Securities Transaction Tax?
You can find an updated list on the official website for Government e-Marketplace operated by Department Of Economic Affairs (DEA).
Who collects and administers the collection and deposit of Securities Transaction Taxes?
The Stock Exchanges collect and administer collection and deposit of STT for Government. They then submit it to Central Board Of Direct Taxes (CBDT).
Is it necessary to pay interest if Securities Transaction Taxes are paid late?
Yes, late payments will attract a penalty as prescribed under applicable Income Tax Act 1961 which can be up to 30% along with applicable interest charges per annum until full payment is made..
Can I claim back taxes against my profits on sale/purchase in stock exchange?
No, You cannot claim back taxes against your profits as they are only levied at sales point but not on capital gains earned by individual investors through investment in securities listed in recognised exchanges.
Final Words:
Securities Transaction Tax (STT) is an important financial market taxation instrument implemented by Government of India in order to promote investing in longer terms so that investors may ensure fruitful returns over time rather than quick profits through speculation or short term trading with high risk involved. Although there exist exemptions in certain cases, generally this tax applies steadily across all trades done within stock markets either equities or debt instruments at varied rates per different transaction specific characteristics like nature/type/transfer modes etc.
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