The securities transaction tax has run into rough weather within a month of its implementation. Brokers are calculating the tax on their own and reporting the dues in contract notes.

Complications arise when the data computed by brokers do not match with the amount determined by exchanges.

The problem springs from the time at which exchanges generate detailed broker-wise statements of transactions and the tax due.

Brokers say exchanges send these files very late, while they have to issue contract notes to clients much earlier.

Typically, brokers have to send out contract notes to clients before 5 p.m. to give them enough time to reconcile accounts, while exchanges send detailed files only after 6.30 p.m.

The time mismatch is forcing brokers to calculate the tax on their own. Brokers add that exchanges issue data files separately for trade-to-trade and rolling settlement transactions.

However, for the purpose of the tax they issue one consolidated figure per client, causing a problem. Brokers then have to break up the figure as they usually issue different contract notes for trade-to-trade and other transactions.

Brokers say they forsee problems in terms of income tax audits at the end of the year, if the figures fail to match consistently.

Some brokers told Business Standard they would be more comfortable if the tax were to be collected on a consolidated basis at the end of a month or even fortnightly.

Exchange officials were unavailable for comment, though sources confirmed that generating the detailed files took time.

Says an institutional broker on conditions of anonymity: "We get the files very late, while the institutions want contract notes much earlier. We have to calculate the tax on our own and make the contract notes. Later, when we get the files from exchanges, we try to tally the figures but sometimes they do not match."

He, however, added that these were mostly teething problems and hopefully would be sorted out soon. The securities transaction tax is being calculated on the volume-weighted average price of the traded security.