The BSE Sensex shaved off all its gains after Finance Minister Pranab Mukherjee hiked standard excise duty rate from 10% to 12%. Even he raised duty on large cars from 22% to 24%.
Service tax increased to 12% from 10%, which will yield Rs 18,660 crore for the government, FM says.
The BSE benchmark lost 90 points to 17,585.63 and the NSE benchmark fell 22 points to 5,358.05.
At 12:25 hours IST: Choppy Sensex trades higher; FM cuts STT by 20% to 0.1%
The BSE Sensex was extremely volatile during speech by Finance Minister Pranab Mukherjee. He said the government has reduced Securities Transaction Tax (STT) by 20% on delivery transactions to 0.1%.
He set fiscal deficit target 5.1% of GDP for FY13. He, during his Union Budget Speech, said income upto Rs 2 lakh exempted from tax. "Income from Rs 2-5 lakh - tax will be 10%; income from Rs 5-10 lakh - tax will be 20%; and above Rs 10 lakh - tax of 30%."
The Sensex was up 38 points at 17,714.11 and the NSE Nifty rose 17 points to 5,397.85.
Even the market breadth improved further; about 750 shares advanced while 696 shares declined on the National Stock Exchange.
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