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What is Securities Transaction Tax and why its hike in Budget worries traders?
short by Dharini Mudgal / on Sunday, 1 February, 2026
Budget 2026 raised Securities Transaction Tax on Futures contracts to 0.05%. STT is tax charged on value of securities traded on recognised Indian stock exchanges. It applies to transactions involving shares, equity mutual funds, futures and options. It's charged at time of the transaction, regardless of profit or loss. Traders are worried because it adds to overall cost of trading.