Security Transaction Tax (STT)

  • Security Transaction Tax (STT) was first introduced in the Union Budget 2004.
  • The idea of STT was born after it was found that there were cases of capital gains taxes evasion through real and fictitious losses. Thus, STT came into being as a way of realizing the actual potential of taxing the stock markets. So, while long-term capital gains (LTCG) tax was exempted, STT was introduced to make sure there was no tax evasion. And then, LTCG too made a comeback in 2019.

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New mechanism to reward whistle-blowers and other informants for sharing information about insider trading: SEBI

  • Insider trading refers to the trading of securities while in possession of Unpublished Price Sensitive Information (UPSI) about the particular securities.

  • Under the new framework, it would be mandatory to disclose the source of information, besides, confidentiality regarding the identity of the informant would be protected
  • SEBI said the reward would be given in case the information provided leads to disgorgement of at least Rs 1 crore in accordance with the PIT (Prohibition of Insider Trading) Regulations

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