Investing in stocks will be cheaper now with Finance Minister P Chidambaram proposing a cut in the securities transaction tax, or STT. He proposed to make the following reductions in the rates of tax:
Equity futures: from 0.017% to 0.01 percent
MF/ETF redemptions at fund counters: from 0.25 to 0.001 percent
MF/ETF purchase/sale on exchanges: from 0.1 to 0.001 percent, only on the seller
He also proposed to introduce Commodities Transaction Tax (CTT) on non-agricultural commodities futures contracts at the same rate as on equity futures, that is, at 0.01 percent of the price of the trade. Trading in commodity derivatives will not be considered as a 'speculative transaction' and CTT shall be allowed as deduction if the income from such transaction forms part of business income. Agricultural commodities will be exempt.
Worries about a prolonged stand-off between investors and Maruti Suzuki Ltd(NSI:MARUTI.NS - News) sent the automaker's shares down as much as 4.2 percent on Tuesday. The company's shares, which recovered later, have underperformed the broader index ever since Suzuki Motor Co, which owns 56 percent of Maruti, in January announced plans to invest $488 million on a new plant in India and shelved an earlier plan for Maruti to set up the factory itself. A group of 16 big fund managers said in a …