Q. Securities Transaction Tax in India is a direct tax levied on:

[A] All over-the-counter trades in unlisted securities

[B] Purchase and sale of equity shares, derivatives, and units of equity-oriented mutual funds on recognized stock exchanges

[C] Transactions in government bonds and treasury bills

[D] Currency derivatives traded on commodity exchanges

Answer: B
Notes:

Explanation: Securities Transaction Tax (STT) applies to the value of specified securities transacted through recognized stock exchanges, excluding commodities and currency, and is collected on both buy and sell sides for equity delivery at 0.1%.

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