Terming as "counter productive" the proposed transaction tax on commodity trading, exchanges, regulator and brokers today hit out at Finance Minister P Chidambaram saying the move will kill the futures markets.

"CTT will have an adverse impact on the futures markets. It would virtually kill the growth story of 23 commodity exchanges in the country," FMC chairman B P Khatua told PTI.

"Introducing CTT on a four year old commodity market, which is just one sixth of the size of stock market on par with STT is not fair," he said, adding this might encourage investors to get into grey market.

The finance minister on Friday proposed Commodity Transaction Tax on the same line of securities transaction tax on options and futures.

National Commodities and Derivatives Exchange CEO and managing director P H Ravikumar said, "CTT is likely to bring down the investors participation in the exchanges."

MCX, the leading commodity exchange, deputy managing director Joseph Massey said: "The imposition of CTT will make the commodity market inefficient as commodities are global product and the users are sensitive to cost of trading."

"Introduction of CTT is a slightly negative stance, which could affect the strong investors' interest in the commodities trading," brokerage firm SMC Global vice president Rajesh Jain said.

"Commodity markets would be affected and they have to bear the brunt", Asika Brokers Research Head Paras Bodhra said.