Marketsregulator Sebi plans to rationalise brokerage limits aims to make investing more cost-efficient and transparent, ensuring investors pay only for the value they receive and not twice for the same services, according to industry experts.

The comments came a day after Sebi released a consultation paper aimed at reducing brokerage costs, improving fee transparency, and simplifying the way investors are charged. As part of the proposal, the Securities and Exchange Board of India (Sebi) has suggested that the total expense ratio (TER) should exclude all costs, including brokerage and taxes, and that a detailed break-up of such expenses be disclosed to investors. “The rationalisation of brokerage limits ensures that investors do not end up paying twice for research and advisory, thereby aligning costs with actual value delivered,” Feroze Azeez, Joint CEO of Anand Rathi Wealth, said. Explaining the rationale, Azeez said that keeping statutory levies such as GST, STT, and stamp duty outside the TER “adds clarity and makes it easier to compare the true cost of investing across different schemes”. Echoing a similar view, Trivesh D, Chief Operating Officer at discount broking platform Tradejini, noted that “by not including statutory charges such as GST and STT in TER, Sebi is preventing fund houses from being disproportionately affected by tax changes, which brings more transparency in cost disclosures.”