Micheál Martin (Cork South Central, Fianna Fail)
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Question 170: To ask the Minister for Finance his views on whether the recent decision of the Revenue Commissioners to write to pensioners was handled correctly; if not, the actions he proposes to take; and if he will make a statement on the matter. [2326/12]

Michael Noonan (Limerick City, Fine Gael)
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Deputy Martin will be aware that the Chairman of the Revenue Commissioners, at a meeting on 11 January 2012 of the Joint Committee on Finance, Public Expenditure and Reform, explained to the Committee Revenue's approach to using data that the Commissioners received from the DSP on long-term pension payments. The Chairman explained that Revenue's role is to collect the right amount of tax from all taxpayers. Revenue's evaluation of the data supplied by the Department of Social Protection was that, on aggregate, a material amount of additional tax was due from recipients of the relevant DSP pensions and Revenue had a responsibility to the State to secure that tax as quickly as possible. It was further explained that Revenue's primary objective was to put matters right for 2012 and they had very little time to do that. Deferring any action until some time in 2012 would have meant that arrears of tax would have built up for the taxpayers concerned.

I am satisfied that the Revenue Commissioners had to act quickly to ensure that the changes required to secure the additional taxes arising from the exchange of data with the DSP were implemented in time for the start of the 2012 tax year. I am also satisfied that the purpose of sending letters out to different groupings was well intentioned and sought to explain how the inclusion of up-to-date figures from the DSP would affect taxpayers' tax credits and rate bands. The Chairman of the Revenue Commissioners has acknowledged that the letters caused confusion and distress to some people and apologised for any distress. Revenue has and will continue to meet groups representing pensioners to get their views on how best to explain the whole area of the interaction of tax and pensions to their members.

Revenue has a good track record in managing large projects in a sensible way while at the same time collecting the tax that the State needs and I am confident that they will on this occasion also. The response by Revenue staff, in particular the quality of service Revenue staff provided, to the large number of pensioners who contacted them, has been commended by the Joint Committee on Finance, Public Expenditure and Reform.