The National Stock Exchange of India Ltd (NSE) has directed its trading members, including brokers and sub-brokers, to furnish details of excess securities transaction tax (STT) collected from clients but not remitted to the government for FY23-24 and preceding years, following instructions from the income tax (I-T) department.
Acting on the tax authority’s instruction, the Exchange asked its members to submit details of such excess collections under the caption 'Excess STT Retained – NSE'.
Members have been asked to comply with the circular within seven days of its publication and remit the excess tax collected along with interest.
According to the notification, brokers and sub-brokers must deposit the retained amount along with interest at 1% for every month of delay to the NSE. The Exchange will then transfer the amount to the government account.
NSE also asked members to furnish details of excess STT collected and retained for FY23-24 and preceding financial years, including amounts outstanding as of 31 March 2023.
The latest directive follows an earlier circular issued by the NSE on 19 March 2025 which had addressed excess STT retained by members for FY22-23 and earlier years.
In its communication, the exchange had said the I-T department had advised it to draw the attention of market participants to cases where excess STT collected from investors had not been deposited with the government.
Accordingly, members have now been asked to disclose the retained amounts and remit them immediately.
Securities transaction tax-STT is a levy imposed on the purchase and sale of securities traded on recognised stock exchanges in India. The tax is collected by brokers from investors at the time of executing trades and is subsequently remitted to the government through the exchange mechanism.
Failure to deposit the collected tax effectively means that amounts deducted from investors have not reached the government treasury.
The directive from NSE also comes against the backdrop of recent changes to STT rates announced in the Union Budget 2026 by finance minister Nirmala Sitharaman.
Under the revised structure, STT on futures transactions has been increased from 0.02% to 0.05%.
Similarly, the tax on options premium and the exercise of options has been raised to 0.15%, compared with the earlier rates of 0.1% and 0.125%, respectively.
The revised rates are scheduled to come into effect from 1 April 2026.
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