Service tax on brokerage houses and the securities transaction tax is likely to result in a bonanza of Rs 2,800 crore (Rs 28 billion) to the government this fiscal if the capital market maintains strong momentum, industry body Assocham said on Monday.The combined revenue of STT and the service tax on brokerage would be Rs 2,800 crore in 2005-06, according to an analysis carried out by Assocham Eco Pulse.
The trend of rising sensex, aided by further momentum in FII inflow ($8.5 billion so far) is likely to result in service tax mop up of over Rs 1,000 crore (Rs 10 billion) in the current financial year, Assocham president M K Sanghi said in a statement.
The trend from STT collections of Rs 770 crore (Rs 7.70 billion) upto August this year, shows that the realisation from this head will easily go up to Rs 1,800 crore (Rs 18 billion) by the end of this fiscal.
The government had realised Rs 679 crore (Rs 6.79 billion) through service tax on brokerage in last fiscal, he said.
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