Presenting her first Budget, Finance Minister Nirmala Sitharaman announced restrictrion of Security Transaction Tax (STT) to the difference between settlement and strike price in exercise of options.Addressing the Lok Sabha, Sitharaman said: "I propose to give relief in levy of Securities Transaction Tax (STT) by restricting it only to the difference between settlement and strike price in case of exercise of options." STT was introduced in India in 2004. Commenting on the announcement, Romesh Tiwari, Head of Research, CapitalAim, said the proposal to restrict the STT to the difference between settlement and strike price will make equity option traders happy with less tax and allow them to lock-in to the gains up to the settlement price of the option."We can see increased volumes in equity derivative trading in the near future," he added.Amit Gupta, CEO of TradingBells, noted that STT levy has been streamlined, and the STT for exercised options will now be applied only to the difference between settlement and exercise price."That's a relief since now traders won't have to be worried about compulsorily squaring off in-the-money options before expiry," Gupta said.