New Delhi, Jan 8 (SocialNews.XYZ) The government has notified uniform stamp duty rates "much lower than earlier" across states for trading in stocks, derivatives, currencies and commodities.
It will become operational on January 9 and help curb the problem of varied stamp duty collection rates.
The notification also makes it easier for consolidated payments through the exchanges where the products are traded.
At present, brokers have to comply with stamp duty payments under the rates levied by states.
The new rate will benefit the currency traders most as it will come down from Rs 200 to just Rs 10 per Rs 1 crore of trade.
According to Corporate law site 'Corporate Proefessionals', with the amendments to the Stamp Act, the central government aims to bring sale or transfer of securities through electronic mode within the ambit of stamp duty and create additional revenue to the state governments and also lay at rest certain ambiguities in the law.
The single rate and centralised system will help streamline the entire process, reduce the cost of collection and plug revenue leakage.
But it will lead to increase in cost of trading in securities as transactions specifically on stock exchanges are subject to the securities transaction tax.
"It's also important to bring the state governments on board with respect to stamp duty rates on issuance of securities, the subject that falls under List II of the Constitution and on which the state governments are only empowered to legislate," it said.
Most states charged between Rs 200 and Rs 300 for non-delivery (intra-day) trades in the equity segment. This will now be at a uniform rate of Rs 300.
For all delivery-based trades, the rate will be Rs 1,500.
The new rates will be lower for active equity traders from states, like Tamil Nadu and Goa, and Union Territories, such as J&K and Ladakh.
Also for equity investors, the new rate is Rs 1,500 per Rs 1 crore of trades, to be paid by buyers only. Earlier both, buyers and sellers, paid stamp duty.
Many states levied stamp duty of around Rs 250-300 on Rs 1 crore intra-day and derivative trades. This has now been fixed at Rs 300 for intra-day, and Rs 200 for derivative per Rs 1 crore.
On delivery based trades, the stamp duty has been fixed at Rs 1,500 per crore on the buy side. It's now Rs 750 on each buy and sell side.
The same for options trading is Rs 300 and Rs 10 for currency segment trading on every crore.
Also, brokers will no longer have to worry about depositing stamp duty to states, that will now be done by stock and commodity exchanges.
The move was announced in the budget by Finance Minister Nirmala Sitharaman this year but is being implemented only now.
Source: IANS
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