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Widening the scope of Commodity Transaction Tax (CTT).

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..... rity between the derivative trading in the securities market and the commodity market. The CTT was levied at the rate of 0.01 per cent, which was also the rate of Securities Transaction Tax (STT) levied on sale of futures (a contract, which derives its value from an underlying asset and is settled by physical delivery) in securities. Subsequently, the scope of CTT was expanded vide the Finance Act .....

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..... SCRA. These goods included cereals and pulses, oil seeds/ oil cakes and oils, spices, metals, precious metals, gem and stones, fibres, energy, sweeteners, plantation, dry fruits and others. Presently, as per SCRA regulations, derivative trading in commodities is limited only to commodity futures and option on commodity futures . The underlying asset in the option on commodity futures is a commodi .....

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..... ity derivative market. Moreover, in order to encourage the commodity transactions , settled by physical or actual delivery of goods, it is proposed to charge CTT on the new commodity derivative products at following rates: - • Sale of a commodity derivative based on prices or indices of prices of commodity derivatives at the rate of 0.01 per cent payable by the seller, which is the same rate .....

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..... le of option in goods and sale of commodity derivatives based on prices or indices of prices of commodity derivatives and (ii) substitute recognised stock exchange in place of recognised association . (b) The reference to FCRA in clause (8) of section 116 is proposed to be changed to SCRA. (c) The table in section 117 to be amended to incorporate the taxable commodities transactions referred to in .....

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