| Applicability of Securities Transaction Tax (STT) post implementation of Interoperability among Clearing Corporations |
This is with reference to the interoperability among Clearing Corporations pursuant to the SEBI Circular No. CIR/MRD/DRMNP/CIR/P/2018/145 dated November 27, 2018.
In this regard, clarification was sought with respect to the applicability of STT on trades done on the multiple stock exchanges which are settled under interoperability framework including the applicability of STT on trades which are settled otherwise than by actual delivery across multiple stock exchanges / clearing corporations.
The Central Board of Direct Taxes vide their letter dated June 6, 2019 has issued the following clarification:
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Under the provisions of STT, it is not material to the charge and levy of STT as to whether the settlement of trade takes place within the same stock exchange / clearing corporation or across multiple stock exchanges / clearing corporations. Accordingly, interoperability of clearing corporations shall have no impact on the incidence of STT on securities and STT at a lower rate shall continue to apply for trades / transactions settled otherwise than by delivery of shares even under the interoperable framework.
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In view of the above, the trading members may kindly note that the STT on trades done on the multiple stock exchanges which are settled under interoperability framework shall continue to be levied as at present at rates as applicable for delivery trades and non-delivery trades respectively, as per the provisions of section 98 of the Finance (No. 2) Act, 2004.
It thus stands clarified that the STT on trades done on multiple stock exchanges which are settled under interoperability framework and are settled otherwise than by actual delivery shall be levied at the rate of 0.025 per cent, payable by the Seller, as per Sr. No. 3 of the table under section 98 of the Finance (No. 2) Act, 2004.
Trading Members are requested to take note of the above
In case of any clarification, trading members may contact the following official on the telephone number and email id given below.
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NAME
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TELEPHONE NUMBER
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EMAIL ID
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Mr. Harihara Subramanian
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022-22728522
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For BSE Limited
Girish Amesara
Financial Controller |