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First and foremost, for understanding the securities transaction tax, one can explain it as the tax charged on the increases from securities. These gains can be such as options, futures done on the domestic stock exchange and equities. Thus, one can infer that securities transaction tax is a direct tax levied and collected by the Central Government.
P. Chidambaram, the Former Finance Minister, in the year 2004 introduced the Securities transaction Tax. This can be referred to as STT. The aim of introducing this tax was avoidance of tax evasion when it comes to capital gains. As we move forward, we shall discuss the Banking Cash Transaction Tax and how the banking cash transaction tax got abolished along with other significant topics.
Banking Cash Transaction Tax
To understand Securities Transaction Tax, it can be said that the tax that is imposed while the purchase is being done and the sale of securities on stock exchanges in India can be referred to as the Securities Transaction Tax. STT can be the short form used for the Securities Transaction Tax. The governance of STT is done by the Securities Transaction Tax India, that is, the STT Act.
The Securities Transaction Tax is mainly imposed on certain specific securities that are taxable such as derivates and equity. The Government can decide upon the STT rate. The rate might vary such that depending based on the security that is traded if the contract made is of sale or purchase. Thus, one may understand that securities Transaction Tax refers to the tax charged as well as collected by the Central Government. It was in the year 2004 that STT was introduced. The STT can be imposed on the securities’ sale and purchase despite the transaction’s loss or profit.
It was in the year 2005 that the Finance Act introduced the banking transaction tax was introduced from the 1st of June, 2005 to prevent generation as well as black money laundering. Banking Cash Transaction Tax can also be referred to as BCTT. According to the BCTT, zero-point one per cent for withdrawing cash is more than a sum of rupees twenty-five thousand on one day.
To learn more about the banks taxed in India one may shed light on how it is required by the banks to deduce tax when interest income from deposits is greater than a sum of rupees forty-thousand for a year held by all the branches of the bank as a whole. If the PAN details are accessible then ten per cent of the TDS is deducted.
Conclusion
As observed from the above discussion, it can be understood that various significant concepts such as the Banking Cash Transaction Tax, Securities Transaction Tax etcetera have been clearly and comprehensively mentioned. The concept regarding the securities transaction tax, the purpose of this tax along with other details such as who introduced it is also very well mentioned above. Apart from this, the concept regarding the banking cash transaction tax, who introduced it, what was the purpose and the abolishment of this tax are also discussed in the above-mentioned sections. Thus, it can be concluded that the various crucial topics related to banking such as securities transaction tax in India, the Banking cash Transaction tax introduced in India and by Banking cash Transaction tax abolished have been discussed above in a comprehensive manner.
