When we purchase shares, we pay a number of taxes on it. These taxes are collected by the government from the market participants on the transactions they make. These taxes are levied when the market participants buy and sell the shares they hold.
Let’s look at the different taxes collected by the government on purchase and sale of shares:
Securities Transaction tax
Securities Transaction tax is charged on both purchase and sale of shares. STT is charged at 0.1% of the total transaction of both sides buy and sell for delivery. In the case of Intraday, STT is charged only on the sell side. For intraday, STT is around 0.025% for the selling party.