This note is not part of the regulations, but is intended to indicate their general effect.
These regulations, which come into force immediately, change the setting process for the taxpayer's paying rate, which is the rate payable on unpaid tax.
The setting process as prescribed in February 2009 is that the rate must be set at the 90-day bank bill rate plus 450 basis points.
The new setting process is that the rate must be set at the floating first mortgage new customer housing rate series plus 250 basis points.
Section 120H of the Tax Administration Act 1994 provides that Orders in Council may be made to—
specify the criteria and other requirements by and against which interest rates will be set or reset and notified for the purposes of Part 7 of that Act. These regulations are made under that provision:
set the Commissioner's paying rate and taxpayer's paying rate. The actual rates are specified in the Taxation (Use of Money Interest Rates) Regulations 1998.
Date of notification in Gazette: 25 June 2009.
These regulations are administered by the Inland Revenue Department.