Consider the following statements about the Securities Transaction Tax STT It is a type of an indire...........

Economic Affairs Tax System

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Consider the following statements about the Securities Transaction Tax (STT).

It is a type of an indirect tax.
It is levied on purchase or sale of securities that are listed on the Indian stock exchanges.
Off-market share transactions are also covered under it.

Select the correct answer using the codes below.

1 and 2 only

2 and 3 only

2 only

1 and 3 only

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Explanation:

STT is a type of direct tax payable on the value of taxable securities transaction done through a recognized stock exchange in the country. The securities on which STT is applicable are shares, bonds, debentures, derivatives, units issued by any collective investment scheme, equity based government rights or interests in securities and equity mutual funds. Off-market share transactions are not covered under STT. For equity transactions that are delivery-based, STT for purchase and sale is 0.1% of turnover and for intra-day transactions, STT for purchase is nil and sale is 0.025% of the turnover.