The Centre is expecting to collect more taxes from levies imposed on securities trading, after Union finance minister Nirmala Sitharaman's Budget 2025 estimated over 40% jump in such collection to cross $9 billion next year, Bloomberg reported.
Purchase and sale of securities like stocks and derivatives attract a securities transaction tax (STT) for both parties involved in the transaction. Given the boom in the country’s equity market and a surge in trading volumes, India has witnessed a sharp growth in mop-up from this levy, the Bloomberg report added.
For the next fiscal year starting April 1, the government is expecting to collect over ₹78,000 crore ($9 billion) through taxes on securities trading.
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This compares with a revised estimate of ₹550 billion collected this year and follows the government’s recent decision to raise STT on equity options and futures.
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Centre cuts borrowing target to ₹11.54 lakh crore
During her budget speech, finance minister Sitharaman announced that the government has reduced its borrowings estimate for next financial year to ₹11.54 lakh crore on net basis as it expects an improvement in tax collection.
{{/usCountry}}During her budget speech, finance minister Sitharaman announced that the government has reduced its borrowings estimate for next financial year to ₹11.54 lakh crore on net basis as it expects an improvement in tax collection.
{{/usCountry}}The government has to borrow by issuing dated securities to meet its fiscal deficit target.
However, gross market borrowings have now been revised upward to ₹14.82 lakh crore from ₹14.01 lakh crore estimated for the current financial year.
"Coming to 2025-26, the total receipts other than borrowings and the total expenditure are estimated at ₹34.96 lakh crore and ₹50.65 lakh crore respectively. The net tax receipts are estimated at ₹28.37 lakh crore," PTI quoted Sitharaman as saying.
"To finance the fiscal deficit, the net market borrowings from dated securities are estimated at ₹11.54 lakh crore. The balance financing is expected to come from small savings and other sources. The gross market borrowings are estimated at ₹14.82 lakh crore," she said.
(With PTI, Bloomberg inputs)