September 22, 1983

You inquire as to the current rate of interest payable on refunds of state taxes.

General Laws Chapter 62C, Section 40 states that interest on refunds shall be paid "at the rate of twelve per cent per annum, or such adjusted rate as is established under section thirty-two…."

Section 32 of Chapter 62C, prior to its recent amendment by St. 1983, c. 233, s. 34, imposed interest on delinquent taxes at 12% "or such adjusted rate as is hereinafter established under section sixty-six hundred and twenty-one of the Federal Internal Revenue Code."

Effective July 1, 1983, Section 32 of Chapter 62C was amended by Chapter 233 to delete reference to the adjusted rate under Internal Revenue Code Section 6621 and to impose interest on unpaid taxes at 18% per year.

Section 40 of Chapter 62C, relating to refunds, was not amended. However, Section 94 of Chapter 233 of the Acts of 1983 states:

"With respect to taxes remaining unpaid on July first, nineteen hundred and eighty-three, the provisions of sections thirty-two, thirty-four and forty-six shall apply from said date to the date of payment of such taxes or with respect to a refund of any overpayment of a tax, the rate of interest established under said section shall apply only with respect to any applicable period from July first, nineteen hundred and eighty-three to the date of payment."

Therefore, the interest rate on refunds is 18% effective July 1, 1983.

Very truly yours,

/s/Ira A. Jackson

Ira A. Jackson
Commissioner of Revenue

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LR 83-74