VPS Share - Good broker... Better plans... Best pricing...
- Thread starter Qreous
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Hi, VPS
Another discount broker is saying completely different thing than your view, although I think your opinion is correct as more brokers are charging Stamp Duty according to your opinion.
Still one question arises is it possible that state can claim the differences later from broker or client. In that case which one broker or client is responsible to pay the difference? This is very important as some State has very high Stamp duty like Rs 1000 or Rs 500, than Rs 200/ Crore.
Please give us the correct legal opinion.
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Here is another discount broker's view which is completely different and they have attached a doc for supporting their claim.
------------------
Best Wishes to VPS.
Another discount broker is saying completely different thing than your view, although I think your opinion is correct as more brokers are charging Stamp Duty according to your opinion.
Still one question arises is it possible that state can claim the differences later from broker or client. In that case which one broker or client is responsible to pay the difference? This is very important as some State has very high Stamp duty like Rs 1000 or Rs 500, than Rs 200/ Crore.
Please give us the correct legal opinion.
--------------------
Here is another discount broker's view which is completely different and they have attached a doc for supporting their claim.
Here you go guys, just that there is no confusion that we are doing this because of opening support office in Chennai, from the IG of Stamps!! They were very clear to us, if we don't start, they will come back and charge us with retrospective, that means if a client has done turnover and stopped trading, they can come back to us later and demand for the difference. This is clearly something that can kill the business for low margin businesses like ours.
TN govt is in a cash crunch and they are pulling everything possible to increase their revenue. We didn't want to be in a situation where tomorrow, we risk ourselves or our clients, better safe than sorry.
TN govt is in a cash crunch and they are pulling everything possible to increase their revenue. We didn't want to be in a situation where tomorrow, we risk ourselves or our clients, better safe than sorry.
------------------
Best Wishes to VPS.
Dear Sir,
Legally Stamp Duty is subject of state and legal position is that it should be deposited to the state exchequer for all those clients who are resident of that state. Keeping this in mind when we launched our online services we also wrote with our brokerage calculator that we will be charging Stamp Duty as per various state depending upon domicile status of client. But there is administrative constraint for a broker who has very few clients from various states to arrange and deposit stamp duty in every state. So what we have stated earlier is the practice that is followed, however, state government has all the right to serve such notice to any broker as they deem fit.
Does it stand to logic that just because you are resident of a particular state
your transaction cost will go up substantially. If your are in business of trading this may make all the difference. But this is what it is - stamp duty remain a state subject and there are differences.
As a broker to be fair we deposit to state exchequer what we charge from clients.
best wishes,
Team VPS
Legally Stamp Duty is subject of state and legal position is that it should be deposited to the state exchequer for all those clients who are resident of that state. Keeping this in mind when we launched our online services we also wrote with our brokerage calculator that we will be charging Stamp Duty as per various state depending upon domicile status of client. But there is administrative constraint for a broker who has very few clients from various states to arrange and deposit stamp duty in every state. So what we have stated earlier is the practice that is followed, however, state government has all the right to serve such notice to any broker as they deem fit.
Does it stand to logic that just because you are resident of a particular state
your transaction cost will go up substantially. If your are in business of trading this may make all the difference. But this is what it is - stamp duty remain a state subject and there are differences.
As a broker to be fair we deposit to state exchequer what we charge from clients.
best wishes,
Team VPS
Dear VPS,
An interesting link for you, please go through that.
Stock brokers get relief in Tamil Nadu stamp duty case
Sanjay Vijayakumar, ET Bureau Jul 16, 2013, 05.00AM IST
--------------
CHENNAI: The Mumbai-based Association of National Exchanges Members of India, the country's premier stock broker lobby, has won an interim injunction against recent changes in the stamp duty structure in Tamil Nadu that it believes will hurt business. This comes even as Tamil Nadu is poised to move away from the Indian Stamp Act of 1899, under which those changes took effect, and adopt its own Stamp Duty Act that prescribes even higher duties for stock transactions.
The association, comprising more than 800 members, moved the Madras High Court after figuring out that the stamp duty changes would make Tamil Nadu-linked business unviable for its brokers.
Tamil Nadu, in the past one-and-a-half years, has increased stamp duties on stock market transactions by 50% to 6 for every 1 lakh worth of transactions, which is, however, in line with what neighbours Karnataka and Andhra Pradesh charge. But what's really bothering brokers is that the state has done away with an upper limit.
Earlier, the stamp duty on a stock transaction would have a cap of 50. Not anymore, unlike its neighbours. So, a transaction for 1 crore would attract a stamp duty of 50 in Karnataka or Andhra Pradesh and 600 in Tamil Nadu. This will become 1,000, if and when a new Stamp Act is introduced in the state. The argument put forward by brokers is that this isn't justifiable because stock transactions could lead to a loss or a profit. In other words, it isn't the same as dealing in real assets.
When Tamil Nadu first communicated the duty changes in November 2011, six months after J Jayalalithaa took over as chief minister, the broker association wrote to Dharmendra Pratap Yadav, Inspector General of Registration, urging him to reconsider the rates and fix an upper ceiling.
In the letter, the association pointed to how stock broking companies were struggling to survive in the wake of intense competition, which was forcing down brokerage rates to 0.1% for delivery and 0.01% for intraday transactions. In comparison, it said, the Tamil Nadu stamp duty on these transactions is 0.006%, which is over and above the various taxes the brokers are already paying.
Even in Gujarat and Maharashtra, which dominate stock transactions in India, stamp duty rates are lesser than in Tamil Nadu, the letter further stated. According to estimates shared by investment experts, Gujarat and Maharashtra together would account for 60% of the stock market transactions in India while Tamil Nadu manages about 5%.
Leading brokerage houses such as Aditya Birla Money, Geojit BNP Paribas Financial Services, Kotak Securities and Sharekhan have a presence in TN. Five members of the Association of National Exchanges Members of India told ET on condition of anonymity that it would be unviable to continue operations in the state if the upper ceiling on duties isn't reinstated.
They said it would make more sense for brokers and clients to move to neighbouring Karnataka and Andhra to avoid such high duties. In the petition filed before the court, the broker association focused largely on a technicality.
----------
Best Wishes.
An interesting link for you, please go through that.
Stock brokers get relief in Tamil Nadu stamp duty case
Sanjay Vijayakumar, ET Bureau Jul 16, 2013, 05.00AM IST
--------------
CHENNAI: The Mumbai-based Association of National Exchanges Members of India, the country's premier stock broker lobby, has won an interim injunction against recent changes in the stamp duty structure in Tamil Nadu that it believes will hurt business. This comes even as Tamil Nadu is poised to move away from the Indian Stamp Act of 1899, under which those changes took effect, and adopt its own Stamp Duty Act that prescribes even higher duties for stock transactions.
The association, comprising more than 800 members, moved the Madras High Court after figuring out that the stamp duty changes would make Tamil Nadu-linked business unviable for its brokers.
Tamil Nadu, in the past one-and-a-half years, has increased stamp duties on stock market transactions by 50% to 6 for every 1 lakh worth of transactions, which is, however, in line with what neighbours Karnataka and Andhra Pradesh charge. But what's really bothering brokers is that the state has done away with an upper limit.
Earlier, the stamp duty on a stock transaction would have a cap of 50. Not anymore, unlike its neighbours. So, a transaction for 1 crore would attract a stamp duty of 50 in Karnataka or Andhra Pradesh and 600 in Tamil Nadu. This will become 1,000, if and when a new Stamp Act is introduced in the state. The argument put forward by brokers is that this isn't justifiable because stock transactions could lead to a loss or a profit. In other words, it isn't the same as dealing in real assets.
When Tamil Nadu first communicated the duty changes in November 2011, six months after J Jayalalithaa took over as chief minister, the broker association wrote to Dharmendra Pratap Yadav, Inspector General of Registration, urging him to reconsider the rates and fix an upper ceiling.
In the letter, the association pointed to how stock broking companies were struggling to survive in the wake of intense competition, which was forcing down brokerage rates to 0.1% for delivery and 0.01% for intraday transactions. In comparison, it said, the Tamil Nadu stamp duty on these transactions is 0.006%, which is over and above the various taxes the brokers are already paying.
Even in Gujarat and Maharashtra, which dominate stock transactions in India, stamp duty rates are lesser than in Tamil Nadu, the letter further stated. According to estimates shared by investment experts, Gujarat and Maharashtra together would account for 60% of the stock market transactions in India while Tamil Nadu manages about 5%.
Leading brokerage houses such as Aditya Birla Money, Geojit BNP Paribas Financial Services, Kotak Securities and Sharekhan have a presence in TN. Five members of the Association of National Exchanges Members of India told ET on condition of anonymity that it would be unviable to continue operations in the state if the upper ceiling on duties isn't reinstated.
They said it would make more sense for brokers and clients to move to neighbouring Karnataka and Andhra to avoid such high duties. In the petition filed before the court, the broker association focused largely on a technicality.
----------
Best Wishes.
Hi,
Yes, it can be done. SL that is put is required to be put within the 3% of market order price. While the trade is open one can amend the SL but it has to remain within the 3% bracket, e.g. one buys nifty at 6000 then SL can be anywhere between 6000 to 5820 and while trade is open one can amend the SL. Editing of SL is possible but cancelling of SL is not permitted in Cover Order.
happy trading,
Team VPS
Yes, it can be done. SL that is put is required to be put within the 3% of market order price. While the trade is open one can amend the SL but it has to remain within the 3% bracket, e.g. one buys nifty at 6000 then SL can be anywhere between 6000 to 5820 and while trade is open one can amend the SL. Editing of SL is possible but cancelling of SL is not permitted in Cover Order.
happy trading,
Team VPS
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