New Delhi, Feb. 1 -- In a blow to the futures and options (F&O) traders in the Indian stock market, Finance Minister Nirmala Sitharaman on Sunday announced a hike in Security Transaction Tax (STT) on Futures & Options (F&O) transactions. In her Budget 2026 speech, Sitharaman proposed to increase STT by a massive 150% on futures transactions and by 50% on options transactions.

As per the Budget proposal, STT on futures will be hiked to 0.05% from 0.02% at present, and STT on options transactions will be raised to 0.15% from 0.01% earlier.

"To provide reasonable course correction in F&O segment in the capital market and generate additional revenues for the Government, it is proposed to raise the STT on Futures to 0.05% from present 0.02%....