The finance ministry may go ahead with its proposal to lower the Securities Transaction Tax (STT) despite about 18% drop in its collections during April-October 2011-12.
"We are confident that we would be able to lower STT and we strongly believe it would lead to higher volumes in the stock market," said an official in the department of economic affairs.
Collection from the STT declined to Rs 2,958 crore in the April-October in the current fiscal year, mainly because of lower transactions on bourses. It was Rs 3,602 crore in the corresponding year-ago period.
The Capital Markets division of the DEA has been pushing for lowering of STT. The stock exchanges had also asked the finance ministry to abolish STT.