https://v2.webnotes.in/tags/equity-etf-stt/Recent content in Equity ETF STT on WebNotesHugoen-INFri, 19 Jun 2026 00:00:00 +0000https://v2.webnotes.in/stt-on-etfs/Fri, 19 Jun 2026 00:00:00 +0000https://v2.webnotes.in/stt-on-etfs/<h2 id="overview">Overview</h2> <p>An exchange-traded fund (ETF) is a pooled investment fund whose units trade on a stock exchange like a share, tracking an index, a commodity such as gold, or a basket of debt instruments. Because ETF units change hands on a recognised exchange, <a href="https://v2.webnotes.in/securities-transaction-tax/">Securities Transaction Tax</a> (STT) can apply to the transaction. The rate, however, is not the equity-share rate, and for several ETF categories it is nil.</p> <p>The central fact is this: an equity-oriented ETF attracts STT only on the sell side, at 0.001 per cent, which is one hundredth of the 0.1 per cent that equity delivery shares pay on each of the buy and sell legs. Gold ETFs, silver ETFs, debt ETFs, gilt ETFs, liquid ETFs and international ETFs carry no STT at all. This article sets out how STT applies to each ETF type, why the equity ETF rate is so much lower than the share rate, and what the absence of STT means for non-equity ETFs.</p>