Effective April 30, 2014, Discount Rates have been changed pursuant to Regulation 74/2014. The Regulation changes the rates currently found in the Law And Equity Regulation, section 1(a) and (b) as follows:
(a) the former discount rate of 2 ½% per annum compound which is the future difference between the investment rate of interest and the rate of increase of earnings due to inflation and general increases in productivity is changed to 1 ½%
(b) the former discount rate of 3 ½% per annum compound which is the future difference between the investment rate of interest and the rate of general price inflation is changed to 2%
This will have a significant impact on cost of future care and cost of future earning calculations.
A link to the full Regulation is here.
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