STT Charges On Futures Options Trading: Another major change taking effect from April 1, 2026, is the Budget announcement of higher Securities Transaction Tax (STT) on F&O trading. STT is collected by the Union government.

The higher STT is aimed at curbing speculative bets being placed on shares in the F&O segment of equity markets and is intended to protect small investors from heavy losses in speculative trades.

STT Charges On Futures Options Trading

STT on futures contracts will rise to 0.05 per cent from 0.02 per cent.

STT on options premiums and exercise of options will be hiked to 0.15 per cent from the present rate of 0.1 per cent and 0.125 per cent, respectively.

STT Charges On Futures Options Trading

Many brokers and traders are concerned that the sharp increase in STT on F&O trading will impact the volumes.

However, experts said that the STT hike on F&O trading may not act as a big negative. It will, hover, impact high-frequency and derivative-focused global funds.

Analysts said the impact on long-only, fundamentally driven FPIs is likely to be limited, as their investment decisions are guided more by earnings visibility, currency stability, and policy predictability.

STT Charges On Futures Options Trading: Analyst View

“The increase in STT announced in the budget and becoming effective from April 1 did come as a surprise to some market participants. Hike will impact retail and high-frequency traders as their transaction costs will go up substantially. Transaction cost changes may influence certain trading strategies at the margin; the broader participation trend remains intact," Shrey Jain, CEO, Stocko by InCred Money

The number of unique individual investors trading in the equity derivatives (F&O) segment was 1.06 crore in FY25, which dropped to about 75.43 lakh in FY26 (up to December 30, 2025).

As per a SEBI study titled 'Comparative study of growth in equity derivatives segment vis-a-vis cash market', individual investors incurred net losses of over Rs 1.05 lakh crore in FY25.