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15th Finance Commission to meet advisory council on May 17 Sources said the council might be asked to do research and study on terms of reference The 15th Finance Commission (FFC) will hold a meeting on next Thursday and it will be attended by members of the newly constituted advisory council on the contentious terms of reference (ToRs). Under pressure from states not ruled by the BJP to withdraw or amend some vexed ToRs, the FFC on Wednesday announced the setting up of the council. Its members include Arvind Virmani, former chief economic advisor; Surjit Bhalla, part-time member of the Economic Advisory Council to the Prime Minister; J P Morgan Chief India Economist Sajjid Chinoy; and Credit Suisse India Economist Neelkanth Mishra. Sources said the council might be asked to do research and study on ToRs. This is probably the first time that a Finance Commission has set up a council on ToRs. Meanwhile, former finance minister P Chidambaram tweeted that the council could not a...

Banks under taxman scanner for GST refund on ATM transactions   The indirect tax department’s investigation arm is scrutinising the GST credit availed by banks on taxes paid by their ATM vendors and could soon ask banks to cut the credit availed by them, two people with direct knowledge of the matter said.  The taxmen are examining whether banks are eligible to avail 100% of Goods & Services Tax (GST) credit on services provided by vendors such as ATM withdrawal when a majority of such transactions are not charged to consumers.  The scrutiny started after banks claimed 100% input tax credit on the amount paid to ATM vendors who are responsible for maintenance and cash supply to the machines.  The vendors charge per withdrawal and add GST on the bills submitted to banks. Now, the banks have claimed input tax credit on the amount paid to vendors but this practice has come under the scanner.  The tax officials believe that since banks don’t charge on ma...

Falling rupee to take FY19 trade deficit to 4-year high of 6.4 percent: Report  Continuing fall in the rupee will push trade deficit up to a four-year high of USD 178.1 billion or 6.4 per cent of GDP this fiscal year, says a report.  "Trade deficit will widen to a four-year high of 6.4 per cent of GDP in FY19," India Ratings said in a report today and blamed higher crude and gold imports.  In FY18, trade deficit had stood at USD 156.8 billion or 6 per cent of GDP.  The estimate comes amid a depreciation in the rupee against the dollar, wherein it has shed over 5 per cent to breach the Rs 67-mark to the dollar.  The agency said apart from the risk of wider trade deficit, escalation in commodity prices, particularly crude, coupled with expectation of the US Fed raising its rates further, is exerting pressure on the rupee.  The agency said contribution of trade as a percentage of GDP has slid to 40.6 per cent in FY18 from a high of 55.8 per cent in FY1...

Panel interviews 9 for RBI Deputy Governor's post  The Cabinet Secretary-headed panel today interviewed three senior bureaucrats and six bankers for the post of RBI Deputy Governor which fell vacant in July last after S S Mundra retired on completion of his three-year term.  Some of the bankers who appeared for the interview included IDBI Bank managing director M K Jain, UCO Bank executive director Charan Singh and SBI managing directors B Sriram and P K Gupta  Besides, K P Krishnan, Secretary Skill Development and Entrepreneurship, Yaduvendra Mathur Additional Secretary NITI Aayog and T V Somanathan, Principal Secretary in Tamil Nadu also appeared for the interview before Financial Sector Regulatory Appointment Search Committee (FSRASC), sources said.  Selected name from the interview will be sent to Appointments Committee of the Cabinet headed by the Prime Minister for final approval, sources added.  Besides Cabinet Secretary, other members of the panel ...