Views of Mr. Narinder Wadhwa, President, CPAI on STT on Options has increased by nearly 25%
High Cost of Transactions on equity and Commodity Trade May led to a drop in Volume and Liquidity. Fall in volumes, affected liquidity, increased impact cost and is a dampener for Hedgers Steep increase in STT on options and futures Will affect the volumes of HFT players in the short term .. they will have to tweak their strategies to adjust higher STT and impact cost.
Presently, we have very high transaction costs as compared to other foreign jurisdictions by way of CTT, GST, stamp duty, and Exchange Charges besides the levy of applicable Capital Gain Tax/Income To make India a price setter for most of the commodities being produced/consumed in India, we have to keep our transaction cost low. To be a price setter in the world markets we need high volume with a low impact cost, only then the large hedgers/traders will be attracted.
