Victorian Consolidated Legislation

Penalty Interest Rates Act 1983 - SECT 2

Penalty interest rate

2. Penalty interest rate



(1) The penalty interest rate is the interest rate expressed as a percentage
fixed by the Attorney-General from time to time by notice published in the
Government Gazette.





(2) The Attorney-General must determine the penalty interest rate to be fixed
by-

   (a)  obtaining from time to time a recommendation from the Treasurer as to
        an appropriate institutional rate of interest, which must be a rate-

   (i)  which is charged for loans or paid for borrowings by a public or
        commercial institution; and

   (ii) which, in the opinion of the Treasurer, reflects prevailing commercial
        rates of interest; and

   (b)  determining, after consultation with the Treasurer, whether the
        recommended institutional rate should be adjusted to include a penalty
        element, and, if so, the nature and size of the adjustment; and

   (c)  adding or subtracting the adjustment (if any) to or from the
        institutional rate.

(3) If there is any change to the percentage of the institutional rate, the
Attorney-General may fix a new penalty interest rate to take account of the
change and may do this without complying with subsection (2).



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