Farm Ireland
Independent.ie

Monday 5 December 2016

Kerry push for Revenue test case on co-op shares

Martin Ryan and Darragh McCullogh

Published 29/11/2016 | 12:00

Agriculture Minister Michael Creed Picture: Tom Burke
Agriculture Minister Michael Creed Picture: Tom Burke

Kerry Co-op have demanded the opportunity to take a test case to court on the Revenue's move to collect income tax from Kerry co-op shares.

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A letter from Kerry Co-op outlining the issue was delivered by hand to Revenue's offices in Tralee on Friday.

"There is precedent for this where it involves a large number of individuals," said a spokesman for Kerry Group, who are assisting the co-op fight the case.

The hope among Kerry suppliers is that agreement by Revenue to the test case proposal would override the requirement for individual shareholders to respond to Revenue's initial letters within 21 days and effectively 'stop the clock' on that process.

A reply from Revenue to the Kerry Co-op proposal was expected by today (Tuesday).

A source close to the Kerry Co-op board said the board had sought independent advice and was engaging with Revenue with a view to seeking greater clarity on the patronage share issue.

"We are dealing with this as a united outfit and we are determined to take the pressure off individual shareholders," the source said.

He claimed that the matter was essentially "a difference in interpretation" of individual tax liabilities.

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The Minister for Agriculture, Michael Creed confirmed that Revenue are due to come before the Oireachtas Committee next week.

However, he declined to offer much comfort to farmers affected by the Revenue's hunt for income tax on the back of 600,000 loyalty shares issued over three years to 2013.

"I am not sure that there is any role for me to become directly involved at present. Taxation laws are there and there has been no change in that," he said in reply to farmers who called for him to intervene directly on the issue.

Limerick farmer, Jimmy O'Donnell claimed that the decision to issue tax demands to 400 Kerry farmers in respect of new co-op shares issued to milk suppliers in recent years could have implications for all co-ops and their suppliers.

"It is an attack on the co-ops now and will leave co-ops open to possible take over by vulture funds," he said.

Minister Creed said that while the Revenue are independent, he is aware of the situation and has had contact from farmers in his own area.

However, he insisted that it was a matter for clarification between Revenue and the co-op.

"I know that the Kerry are in contact with the Revenue for clarification and that process is in place" he said.

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