Applicability of Rate of Interest where interest rates have changed before tax/duty payment



Quick Summary
When paying tax or duty late, interest is usually charged at the rate applicable at the time of payment. However, a significant ambiguity arises when interest rates change between the original due date and the actual payment date. The law is currently silent on this, creating a 'grey area' with conflicting judicial interpretations. This article explores these differing viewpoints and highlights the need for clarification.

Applicability of Rate of Interest where interest rates changed before tax/duty payment - Gray Area for which Clarification required 1. In taxation, taxpayers have to pay tax/duty on or before prescribed due date and if tax/duty is being paid after due date, taxpayers have to pay interest at the r
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