Following STT Hike, SEBI Chair Signals No Near-Term Plans for F&O Market Restrictions

The Securities and Exchange Board of India confirmed that it will maintain the existing regulatory framework for futures and options after the Budget announced higher Securities Transaction Tax. 

SEBI Stance on Derivatives Market 

Chairperson Tuhin Kanta Pandey stated that the regulator will continue with the current rules and is not planning any immediate measures.  

He highlighted a data driven approach and said decisions will be based on market statistics. The existing framework will remain in place for the time being. 

Details of STT Increase 

The 2026 Budget raised the STT on futures from 0.02% to 0.05% and increased the tax on options premiums from 0.1% to 0.15%.  

The change adds to transaction costs for participants in the derivatives segment. Market participants have noted that the higher levy could affect trading volumes and cost structures. 

Read More: SEBI Simplifies Legacy Share Claims: Direct Demat Now Allowed Without Letter of Confirmation! 

Market Reaction and Weekly Expiry Rumours 

Following the tax hike, some traders expressed concern that the regulator might tighten other aspects such as the weekly expiry contract.  

Pandey clarified that there is no plan to discontinue the weekly expiry and that the status quo will continue. His comments aim to provide stability while the market adjusts to the new tax rates. 

Conclusion 

SEBI’s announcement confirms that no new restrictions will be imposed on the futures and options market immediately after the STT increase. The regulator will monitor market data and retain the current framework, allowing participants to adapt to the higher transaction tax. 

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