Govt eyes higher Securities Transaction Tax for next fiscal

But for current year, has lowered STT target to Rs 5,497 crore from Rs 6,720 crore

Missing the tax collection target from securities, the government is looking to raise close to Rs 6,000 crore through Securities Transaction Tax (STT) in the next fiscal, says the Interim Budget presented today.

The government has also lowered its STT target to Rs 5,497 crore from Rs 6,720 crore for the current fiscal.

According to the Interim Budget unveiled by Finance Minister P Chidambaram today, the government has fixed its collection from STT to Rs 5,992 crore in 2014-15. This is 9 per cent more than the revised target of Rs 5,497 crore for the current financial year.

The government had garnered Rs 4,996.86 crore from STT in the 2012-13 fiscal.

Introduced in 2004, STT is levied on the sale and purchase of equities in the capital markets. Going by estimates, the tax accounts for a substantial part of the overall transaction costs in the stock market.

A majority of the market participants have been demanding removal or lowering of this tax.