Latest Expert Exchange Queries

GST Demo Service software link: https://ims.go2customer.com
Username: demouser Password: demopass
Get your inventory and invoicing software GST Ready from Binarysoft info@binarysoft.com
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing | GST - Goods and Services Tax
 
 
 
 
Popular Search: empanelment :: VAT RATES :: Central Excise rule to resale the machines to a new company :: ACCOUNTING STANDARD :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: ARTICLES ON INPUT TAX CREDIT IN VAT :: due date for vat payment :: list of goods taxed at 4% :: TDS :: articles on VAT and GST in India :: ACCOUNTING STANDARDS :: form 3cd :: VAT Audit :: cpt :: TAX RATES - GOODS TAXABLE @ 4%
 
 
General »
 Exemption From Capital Gains On Sale Of Agricultural Land
 FinMin wants RBI to lower rates, boost domestic demand
 Employees may have to bear the GST burden on benefits
 Advance tax payout by top cos grows just 2% in Sept quarter
 Why abolishing personal income tax may not be a good idea
 Questions about the GST cess
 How to prepare for the looming tax-extension deadline
 Income tax: Gratuity for employees raised to Rs 20 lakh; here is how you will benefit
 Haryana to set up scrutiny panel on GST benefits
 Waive certain taxes for companies in insolvency proceeding
 I-T department to appoint 7600 more tax return preparer scheme to cover entire country

Commodity exchange officials oppose stock exchanges' tax parity call
February, 13th 2013

It's not unusual for stock exchanges to make a case for a removal or a cut in securities transaction tax at this time of the year. Neither is their demand for imposition of a similar tax on the nine year-old commodity futures market. But this time round, with the government desperate to offset its ballooning expenditure, such calls have been combated more vehemently by commodity exchange officials.

The stock exchanges argue that a transaction cost such as STT inhibits growth of their market by leading to a shift in volumes to the commodity exchanges, which do not impose such a levy. Stock exchanges are demanding tax parity to stop the shift to "speculative" trades.

"If you see the volume trends of equity derivatives and commodity futures, equity derivatives have seen a fall in volumes over the past few years, whereas commodity futures markets have seen consistent growth. Both the markets face different costs based on differential taxation and the cost structure is not favourable to equity derivatives," an NSE official told ET.

But commodity exchange officials contest this. They say transaction costs, currently at around Rs 2 per lakh, will jump eight-fold to Rs 16 a lakh if a tax like STT is imposed on commodity futures trades. This will kill the market and shift volumes to the illegal dabba market to bucket shops or dabba markets, where nobody pays margins or taxes.

"Volumes have shifted from the equity and index futures, where STT is charged on contract value, to equity and index options where the levy is imposed on premium, which is much less," said Rajnikant Patel, CEO of Reliance ADA-promoted ICEX.

"How can stock exchanges demand parity when the two markets are so unalike," asked Ahmedabad-based commodity exchange NMCE's chief executive Anil Mishra.

"Our market is used for hedging and stock markets are for investing. Further, even income is treated differently for tax purpose. But since gains or losses from commodity futures trades are treated as speculative, they cannot be offset against business income or loss."

A BSE spokesperson said, "To remove discrimination against the investment in securities markets, it is important to look at removing STT altogether. However, if it is not possible to remove STT, it is suggested to levy a tax similar to STT imposed on transaction in all organised markets except for spot markets in agricultural commodities, which need not be taxed given their importance to Indian economy."

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - Sitemap

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions