Currently, the filter provides Top level terms only and Auto toggle child terms. I propose adding a new option: Child terms only.
When enabled, selecting a parent term in terms: include/exclude will display only its immediate child terms (one level down), instead of all descendants.
This would allow more precise control over taxonomy filters, especially when users want to limit visibility to direct child categories without expanding deeper levels.
Current Limitation:
At present we have to add each child terms manually. When new child terms are added, we have to go to edit template and manually add it again.