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TMI BlogWidening the scope of Commodity Transaction Tax (CTT).X X X X Extracts X X X X X X X X Extracts X X X X ..... aded in recognised associations. The intention behind introducing CTT was to bring parity 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 de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... otified a number of goods for the purpose of its definition in clause (bc) of section 2 of the 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 a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are, therefore, proposed in Chapter VII of the Finance Act, 2013, to align the provisions of CTT with the changes in commodity 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 pric ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of taxable commodities transaction in clause (7) of section 116 is proposed to be amended to (i) include the transactions of sale 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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