MCX to make representation before FMC on CTT

NEW DELHI: Commodity exchange MCX today said it will make representation to various authorities including market regulator FMC to reconsider imposition of commodity transaction tax ( CTT) on non-agri items in Budget.

CTT of 0.01 per cent on non-agri futures traded on commodity exchanges has been proposed in Budget.

In a filing to the BSE, MCX said that its board discussed the issue of imposition of CTT on non-agricultural commodity derivatives contract as proposed in the Union Budget for the FY 2013-14 and the impact thereof on the Indian commodity derivatives markets.

"The Board has decided to make a detailed representation by a letter to the Sectoral regulator FMC as the Budget has given different treatment amongst derivatives, with different underlying assets, as also within commodities themselves, for the purpose of levy of CTT, which is inconsistent with the 'Horizontal Equity' principle of the canons of taxation," it added.

The Board has also decided to take all the requisite steps including making of relevant representations to various authorities for reconsideration and withdrawal of CTT on non-agri commodities.