Overview
- The Budget lifts STT to 0.05% on futures, 0.15% on options premium, and 0.15% on option exercise, effective April 1, 2026.
- Nirmala Sitharaman says the change is not a revenue exercise and is intended as a deterrent for risky retail derivatives activity.
- Traders and brokerages warn the higher levy sharply raises transaction costs, with several strategies turning uneconomical and per-trade costs roughly tripling.
- SEBI previously tightened margins, lot sizes, expiries and other rules, and its study reported over 90% of retail F&O participants incurred net losses totaling about Rs 1,05,603 crore in FY25.
- Analysts view the increase as a small, selective policy signal that could reduce volumes or liquidity and potentially push some activity offshore, with the full market impact unclear.