CTT hits turnover of MCX, NCDEX by up to 50% on first day
CTT of 0.01 percent has been made effective from July 1 on the futures trading of non-agri commodities and processed foods.
New Delhi: The turnover of top two commodity bourses -- MCX and NCDEX -- dropped by up to 50 percent on the first day of enforcement of commodity transaction tax (CTT).
CTT of 0.01 percent has been made effective from July 1 on the futures trading of non-agri commodities and processed foods. The CTT was announced in the 2013-14 Budget.
The analysis of the turnover data maintained by these two exchanges shows that business was affected as traders appear to be cautious in investing in those commodities that attracted CTT.
At MCX, where bullion and energy items are largely traded, the turnover fell by over 50 percent to Rs 34,685 crore on July 1, from Rs 72,162 crore on June 28.
At the NCDEX platform, where farm items are traders, the turnover declined by 44 percent to Rs 2,447 crore from Rs 4,397 crore in the review period.
A similar impact was seen in other commodity bourses as well.
The government has exempted 23 items from the CTT. They include wheat, barley, chana, cotton, potato, coriander, cardamom and guar seeds.
There are 22 commodity bourses in the country, of which six of them operate at national level. The combined turnover of these bourses stood at Rs 170,46,840 crore in 2012-13, down by six percent from the previous fiscal.