New Delhi:The finance minister, P Chidambaram, has called a meeting of brokers associations, the Bond Dealers Association, primary dealers and foreign institutional investors (FIIs) on Monday and Tuesday in New Delhi to listen to their grouses and consider their suggestions.

According to finance ministry sources, the main issue pertains to trading in government securities where off-market trades under the Negotiated Dealing System are legal, unlike in the equities segment where off-market transactions are illegal. "This creates a distortion and needs to be addressed," a source said.

"NDS accounts for almost 35 per cent of the bond market trading," said the source, adding that these trades were spared from the 0.15 per cent transaction tax.

However, bond deals in the wholesale debt market in the NSE and BSE, which account for 65 per cent of the total trade, are subject to the 0.15 per cent tax on transactions.

The ministry is aware that the margins even in long-term government securities are low and it also acknowledged that the transaction tax would hit short-term bond deals.

An option could be to restrict the transaction tax to the equities market and let the present system continue for the debt market, sources said.

Another option, according to sources, was to have two different transaction tax rates, the 0.15 per cent tax per transaction for the equity segment and a much lower one for the debt segment.

Senior finance ministry officials had to intervene today and call up bankers and primary dealers when they saw that there was nil trading in the wholesale debt market (WDM) segment of the National Stock Exchange and the Bombay Stock Exchange, as well as the NDS till about 2 pm.