Niall Collins (Limerick County, Fianna Fail) | Oireachtas source

I thank the Ceann Comhairle for selecting this matter for discussion. This is an important issue for me and the farming community I represent in County Limerick. My colleagues and I fully respect the work and independence of the Revenue Commissioners who have a difficult job which they do professionally. Equally, however, we are fully within our rights in raising this issue and querying the actions of the Revenue Commissioners.

The issue we are discussing must be viewed against the backdrop of what farm families have been experiencing in recent years. I am sure the Minister of State in the Department of Finance, Deputy Eoghan Murphy, is aware of the background. Milk and beef prices have been substantially suppressed in recent years. This has impacted directly on the margins and incomes of many farm families, thousands of whom rely on the family income supplement and survive from hand to mouth. The Common Agricultural Policy has been reformed, milk quotas have been eliminated and the prospect of Brexit has created considerable uncertainty which is impacting on the agriculture sector and caused great worry for farmers and their families. In addition, the farming community has expressed fear and concern about proposed international trade agreements such as the Transatlantic Trade and Investment Partnership, TTIP, and the Canada-European Union Comprehensive Economic and Trade Agreement, CETA, both of which are causing uncertainty in terms of increased competition and price suppression.

Against this backdrop, it was also revealed recently to the Fianna Fáil Party spokesperson on agriculture, Deputy Charlie McConalogue, that only 50% of the funding allocated under the rural development programme had been paid out to farm families this year. Of the €494 million provided across the various schemes, including the agri-environmental options scheme, the green low-carbon agri-environment scheme, GLAS, and the rural environmental protection and early retirement schemes for farmers, only €256 million has been paid out thus far this year.

This is the context in which farm families are operating. In recent days Revenue dropped a bombshell in seeking to change the treatment of patronage shares which suppliers and members of Kerry Co-op have received during the years. Farmers are not trying to evade or avoid tax. They are happy to pay tax, but they need to be given a degree of certainty. Patronage shares have always been treated under the capital gains tax code. Revenue has changed tack and appears to be seeking to treat these shares under the income tax code and, moreover, to do so retrospectively. This has caused immense upset among people who have been asked to find significant sums to pay Revenue and meet their obligations. Farmers have already made their cashflow management plans for the coming years and will have made commitments to purchase machinery, make repayments on investments in buildings and engaged in general business planning. As with all other businesses, farms must be managed on the basis of plans. Has Revenue changed its interpretation of the tax code in respect of patronage shares? If so, people need to know the reason it has done so. As Deputy John Brassil stated, people have been given tax clearance following Revenue audits.

It has also been noted that the Kerry Group had an obligation to inform its members of this issue. Where does the company stand on the matter? I ask the Minister of State to provide some clarity on these matters because Deputies need to be able to reassure their constituents that they will be dealt with in a fair and proportionate manner, rather than being subjected to the threatening language used in recent correspondence.

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