According to Irish dairy farmers, Revenue Commissioners are claiming that they’re owed income tax worth thousands, possibly millions, of euro from Kerry co-op milk suppliers.
Letters have been sent out to hundreds of milk suppliers who are standing strong against the claims. The Revenue letters say that payment of tax arrears on shares farmers received for their loyalty to Kerry Co-Op are due. Cathal McCarthy of the ICMSA has said that he believes over 350 farmers have received the letter. Since the Revenue is focusing on farmers who received shares from within the specific time-frame of 2011 to 2013 roughly, Cathal believes it is 'arbitrary', and raises concerns that more farmers will be contacted.
The fines could reach €50,000 for some farmers. Money from 600,000 patronage shares is being demanded by the Revenue.
The patronage shares are given to suppliers who have long-standing involvement with the co-op, and each share could be worth up to €90. A share is usually given to a supplier each time they provide 1,000 gallons of milk according to the Irish Independent.
Farmers claim that they were never notified of their tax liability, and there are even fears that thousands more farmers will be told they owe substantial amounts to the Revenue. The letter states that farmers have 21 days to respond. There is also a threat of penalties being imposed, and a threat of prosecution, especially if farmers take longer than three weeks to reply.
"We know very little at the moment. There is panic among dairy farmers though, that's for sure. Dairy farmers have had a terrible two years, and some are only breaking even now. To be given this tax demand is very hard.
"I spoke to a farmer this morning who borrowed money to pay his income tax for last year, and now he opens up a letter demanding thousands by the Revenue." explained Cathal McCarthy.
"Nobody saw this coming, that's for sure," concluded Cathal.
ICMSA President, John Comer, said that his organisation has been receiving many calls from hugely concerned Kerry suppliers regarding an “out of the blue” tax demand from the Revenue Commissioners that they have just in a year that has already been tremendously difficult for dairy farmers. Mr Comer confirmed that ICMSA is currently examining the position and will be seeking further clarification from Revenue given the very serious consequences for individual farmers.