On 1 July 1999, the penalty arrangements for late payment and other obligations were rationalised and simplified pursuant to Taxation Laws Amendment Act (No 3) 1999.

This has been done by the introduction of a uniform tax deductible general interest charge (GIC). The GIC applies to a range of penalties, including late payment penalty on outstanding amounts due to the Tax Office.

Section 8AAD of the Taxation Administration Act – 1953, determines the rate of the charge. The daily rate can be calculated by dividing this rate by the number of the days in a calendar year. The GIC when first introduced was based on the relevant 13 week Treasury Note rate plus 8 percentage points. But from 1 July 2001, the GIC is based on the 90 day Bank Accepted Bill plus 7 percentage points.

In the 2000 financial year, the GIC daily compounding rate only applied to PAYE, PPS, RPS & Sales Tax. A simple interest rate applied to other taxes.

The GIC compounding rate now extends to most other taxes, including income tax, fringe benefits tax and the new tax system taxes such as GST and PAYG (including IRW — Interest & Royalty Withholdings).

For some taxes Petroleum Resource Rent Tax, the Commissioner will exercise his discretion to apply a simple interest rate. The GIC is updated quarterly (refer table below), the figure for the March – May quarter should be available mid February.

Quarter GIC annual rate (simple interest) GIC daily rate (compounding)
July – September 1999 12.72% 0.03484931%
October – December 1999 12.73% 0.03487671%
January – March 2000 13.08% 0.0357377%
April – June 2000 13.65% 0.03729508%
July – September 2000 14.00% 0.03825137%
October – December 2000 13.86% 0.03786885%
January – March 001 13.86% 0.0379726%
April – June 2001 13.86% 0.0379726%
July – September 2001 11.89% 0.03257534%
October – December 2001 11.95% 0.03273973%
January – March 2002 11.28% 0.03090411%
April – June 2002 11.31% 0.0309863%
July – September 2002 11.84% 0.03243835%
October – December 2002 11.96% 0.03276712%
January – March 2003 11.84% 0.03243835%
April – June 2003 11.75% 0.03219178%
July – September 2003 11.78% 0.03227397%
October – December 2003 11.82% 0.03238357%
January – March 2004 12.31% 0.03363388%
April – June 2004 12.57% 0.03434426%

Last Modified: Tuesday, 9 March 2004