Finance Minister Nirmala Sitharaman on Sunday announced an increase in STT (Securities Transaction Tax) on futures and options, which may affect derivatives trading costs. Sensex and Nifty rallied after the announcement and conclusion of Sitharaman’s budget speech.
Finance Minister Nirmala Sitharaman shows the digital tablet encased in a traditional red ‘bahi-khata’ style pouch in Parliament (PTI)The government will tax buyback proceeds for all types of shareholders as capital gains, announced FM Sitharaman.
Finance Minister Nirmala Sitharaman presented the 2026-27 Union Budget in Parliament on Sunday, unveiling the government’s fiscal strategy for the coming year. Track live updates of the budget speech here
Raised in STT Options Trading- Increased STT to 0.05% on futures
– Increased STT to 0.15% on options
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The Finance Minister’s announcement means that the Securities Transaction Tax (STT) charged on futures trading has increased from 0.02 per cent to 0.05 per cent of the transaction value, making futures trades slightly more expensive.
STT is a government tax levied on market transactions, so this increase directly increases costs for traders, especially those who trade frequently or in large volumes.
While the increase may help curb excessive short-term speculation and increase tax revenue, it also reduces net profits for active futures traders.
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Budget 2026 focuses on three ‘duties’ or duties, Nirmala Sitharaman began her speech by saying. The three tasks he stated were: accelerating and sustaining economic growth while building resilience to volatile global dynamics; meet the motivation and capacity building of our people; and ensure that every family, community, region and sector has access to resources, facilities and opportunities.
An STT option hike means the government has increased the securities transaction tax charged on option trades, which increases the cost of buying or selling options in the stock market.
This directly affects option traders—especially frequent and short-term traders—by reducing their net profit per trade.
