New Delhi, Feb. 1 -- The Income Tax Department on Sunday clarified about the new STT rules on F&O announced by Finance Minister Nirmala Sitharaman in Budget 2026.

Presenting her ninth consecutive Budget on Sunday, 1 February, FM Nirmala Sitharaman proposed to hike the Securities Transaction Tax (STT) on futures and options (F&O) trading.

"I propose to raise the STT on Futures to 0.05% from present 0.02% options premium and exercise of options are both proposed to be raised to 0.15% from the present rate of 0.1% and 0.125% respectively," she said during her Budget 2026 speech today.

Shortly after FM Nirmala Sitharaman's speech, the income tax department explained the STT hike on F&O trading while giving clarification on why it was incre...