While penny stock punters, among others, are feeling the heat in a very volatile market, there is one positive outcome from the recent nervous trading that is likely to bring a smile to Finance Minister P Chidambaram.On Wednesday, the turnover on Indian bourses was over Rs 40,000 crore—which senior market watchers reckon is the highest in the world. Breaking records apart, such a high turnover means that the government’s collections on Securities Transaction Tax (STT), introduced by Chidambaram in the last budget, for Wednesday alone would be close to Rs 80 crore.The STT is charged at 0.15 per cent of a delivery-based equity transaction (split between the buyer and the seller).From April 2005 till August 2005, the revenue collected by the government under the Securities Transaction Tax, has crossed Rs 800 crore. If the heightened volumes over the last few weeks are factored in, these collections could have easily swollen to over Rs 1,000 crore by now.At this rate, if the markets remain choppy and volumes continue to be as high as we are seeing currently, then collections from the STT could easily cross Rs 2,500-3,000 crore.Even if the market turnover starts declining from here, a Rs 2,000 crore collection in the STT kitty by March 2006, seems easily achievable.
