Noonan says there's no discrimination against farmers in Kerry Co-op share issues
The Minster for Finance, Michael Noonan has rejected suggestions that farmers have been discriminated against in relation to the continuing saga concerning Kerry Co-op patronage shares.
Speaking at a Dail debate on the issue recently, the Minister said he knows there are points concerning this issue that are ‘arguable’ and said that is why he is following the Revenue advice and saying this should be appealed on a test case basis to see where the law lies.
Minister Noonan said the way Revenue operates and has always operated, is in accordance with a long-established taxation principle that where consideration is received for services rendered or produce sold, that consideration is subject to taxation as part of an individual's income.
“In other words, regardless of whether one is paid in cash or in kind, one has a tax liability if one is paid in kind in lieu of cash.
“That is the principle and that has always been the case.
“If one is paid in kind instead of cash, one is liable for tax on the monetary value of whatever the payment in kind is.
“Revenue now deems that discounted shares were payment in kind for each 1,000 litres of milk.
“That is the case it is making. That should be tested, and it is well worth testing it, but Revenue is not changing the law or its practice. It is doing what it does with every taxpayer. It is applying the law,” the Minister said.
He stressed that he has been involved with the issue since the start.
“It was brought to my attention by several Deputies. I got my officials to inquire into it and I am meeting the chairman of Revenue before the end of the month and will raise this issue again, even though it is not the primary purpose of the meeting,” he said.
Referring to suggestions that there is some kind of discrimination against farmers. Minister Noonan said there is "no discrimination".
“This is the way tax law applies,” he said.
“I have been very sympathetic, to the farmer taxation system and have introduced amendments to reform farm tax in a very fundamental way over the past four or five years.
“Someone can average income over five years, a change we introduced two years ago.
“This year, we introduced an extra year because this was a very poor year for farming with very little profit.
“There is now a sixth year which someone can use as an opt-out year on income averaging and only pay whatever tax liability there is for that individual year. If, by definition, there was hardly any income at all, one would not have a tax liability on it,” he said.
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