John Brassil (Kerry, Fianna Fail) | Oireachtas source

I thank the Revenue Commissioners for attending the committee meeting. This is a hot issue, particularly in County Kerry which I represent. There are several issues which I wish to raise to tease out the issue and come to a satisfactory conclusion for the 400 people affected.

In his presentation, Mr. Charlie Phelan stated it was not a change of policy. Patronage shares have been around for 20 years. It is not that the Revenue was not aware of them. They have been returned in tax returns by compliant tax farmers as long as they have had them. They have never been requested to pay income tax on them. They would see it is a change of policy. Over time, shareholders have transferred patronage shares from family members, for example. They have sought advice on the value of them and were given advice that they were to be treated at the value of €1.27. A compliant taxpayer got advice from the Revenue Commissioners, made his returns on that basis but then got this letter in the post. That was very unexpected.

Is it not normal procedure to advise tax consultants and accountants that there is an issue which must be teased out so as to arrive at an agreed position? I agree with Senator Kieran O'Donnell that this letter seems to have come out specifically to get the 2011 assessments. Is that being fair? Approximately 400 letters have gone out. How many other patronage shareholders were not contacted? When will they be contacted? How many other patronage shareholders are there in every other co-operative? I know the situation exists with Glanbia and Dairygold. There is much broader issue at stake. Under the Taxes Consolidation Act, taxpayers are to be treated equally. Unless the Revenue Commissioners get everything out to all those affected in other co-operatives by the end of this year, I would argue the 400 farmers in question are not being treated equally. They will come in under the 2011 assessment while the rest will not.

If the Revenue's assessment was 100% correct, then the 2011 shares are based on the 2010 milk yield. Does that bring it outside the four-year rule? That is another issue that needs to be teased out.

A stop should be put to this and the test case needs to be heard. All taxes and penalties should be suspended until we get full clarification of this issue. The letter the 400 farmers received stated, "To enable you to avail of the opportunity to make such a disclosure, please respond with your computation of the tax liability together with the appropriate payment". To anybody that reads like a demand for payment. It would be only fair after this meeting and everything has been clarified that each of the people involved is written to and informed of the decisions made to take the pressure off. As was stated in the submission, it has been a difficult year. People would have made financial decisions based on investments, not realising there was a €20,000 or €50,000 tax bill around their necks. We are all human beings in business. That is a difficult position to be in. One makes an investment on the basis one has a certain income and ability to pay it back but is then hit with this.

At what level was the decision to pursue this made? Was it at the very top or at regional or local level? I would like to know why 400 people in Kerry seem to have received this treatment but no one else did.