The Treasury Department has announced in the Federal Register Notice that the Prompt Payment Act interest rate is being decreased to 1-7/8% per annum for the period of July 1, 2016 through December 31, 2016. 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 2-1/2 %, so this new rate reflects a five-eighths (0.625) percent interest rate decrease.
For an updated list of the established interest rates for all periods since January 1, 1980, see:
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