Government approves draft bill reducing interest rate on late tax payments/refunds

On 30 March 2022, the German government approved a draft bill providing for a reduced interest rate on late tax payments and refunds, which was published by the Ministry of Finance (MoF) on 22 February 2022.

The draft bill proposes a reduced interest rate of 0.15% per month (i.e., 1.8% per year) on late tax payments and refunds with retroactive effect as from 1 January 2019. The draft bill also proposes that the interest rate be evaluated every three years, with the first evaluation occurring in 2026. The draft bill notes that changes are not anticipated in any other cases (e.g., interest on deferrals, interest applied to pension accruals discounting, etc.)

Source Deloitte

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