Short Take: Treasury Increases Prompt Payment & Contract Disputes Interest Rates, Effective 1/1/16
January 18, 2016
The Treasury Department has announced that the Prompt Payment Act interest rate is being increased to 2-1/2% per annum for the period of January 1, 2016 through June 30, 2016. Federal Register Notice. This interest rate is used to calculate the interest penalty paid by the Government when it fails to timely pay contractors for goods and services, as well as interest due under the Contract Disputes Act. The prior interest rate was set at 2-3/8 %, so this new rate reflects a one-eighth (0.125) percent interest rate increase.
For an updated list of the established interest rates for all periods since January 1, 1980, see http://www.fms.treas.gov/prompt/rates.html
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