Kerry Shares: TDs and Senators urge the Revenue Commissioners to await an appeal

Downing on politics...

Michael Healy-Rae. Pic Tom Burke
Michael Healy-Rae. Pic Tom Burke
John Downing

John Downing

All five Kerry TDs and one of the county's senators were there. So were representatives from surrounding counties, Limerick and Cork, where the Kerry Group writ runs.

Keen political rivals were allies for two hours as they faced three senior representatives from the Revenue Commissioners at the Oireachtas Finance Committee. At issue is the Kerry Co-op "patronage shares", which are now a hot topic across the south west of the country.

In fact farmers in many other co-ops across the country are watching this one carefully. The Kerry Co-op tax case may create a precedent with big consequences for many farm families.

The solid matter hit the fan last month when 400 Kerry Co-op farmers got letters telling them income tax was due on these shares which were effectively a kind of loyalty bonus. The outcome caused widespread concern and all public representatives were made aware of the controversy.

"Farmers feel that they have been blindsided by these letters," committee chairman and Kilkenny Fianna Fáil TD John McGuinness said. He said the committee wanted to hear more about the details as tax bills ranged from €5,000 to €50,000 depending on the size of the operation.

It is worth giving a flavour of these unusual committee exchanges which epitomised courtesy, but also had a certain edge. There were lively contributions and close questions from the Kerry TD quintet, the Healy-Rae brothers, Michael and Danny; Fianna Fáil's John Brassil; Brendan Griffin of Fine Gael; and Sinn Féin's Martin Ferris; along with Fine Gael Senator Paul Coghlan of Killarney.

Michael Healy-Rae offered the following contribution: "There are people working with yourselves who are raising their eyebrows and believe what you're doing is not right." That of itself raised eyebrows.

It followed a similar foray from Cork North West Fianna Fáil TD, Michael Moynihan, who similarly raised the issue of doubt.

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But the Revenue's lead representative, Charlie Phelan, was having none of that. He insisted that the Revenue were sure of their ground and determined that the matter did not involve any change in taxation rules.

For Mr Phelan it was about fairness for all taxpayers and avoiding a loss of tax revenue. When pressed he said interest on unpaid back taxes was fixed by law - but he signalled penalties were unlikely for farmers acting in good faith on the basis of professional advice.

There were many heartfelt expressions about the worry and anxiety caused to farm families who are already struggling to keep abreast of their tax liabilities. Mr Phelan said he and his colleagues were aware of difficulties in the sector and not seeking to add to them.

But while emotions are understandable - they did not help us learn where this issue was going. For that reason a persistent series of questions from Fine Gael Limerick Senator, Kieran O'Donnell, were most helpful here.

Senator O'Donnell, also a chartered accountant with great experience of farming and small business, was most concerned that the 21-day period which dated from last month would be extended. He was most insistent that it be extended to at least 60 days.

Mr Phelan undertook to do this with new letters, framed in a more moderate tone than the original one, being sent out to the farmers concerned. Afterwards Senator O'Donnell said he believed the issue would soon be before a Tax Appeals Commissioner in the coming months and action is stalled for now pending the outcome of that one.

John Downing is an Irish Independent political correspondent

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