The Budget announced by Minister for Finance Michael Noonan on 7 December 2011 provided for additional taxation receipts from the targeting of pensioners by the Revenue, even though the initiative only emerged this week following demand letters being received by pensioners, according to Fianna Fáil Finance Spokesperson Michael McGrath.
Deputy McGrath stated, “Fine Gael and Labour promised the Irish people that they would be upfront and honest with them at all times. In this case, the simple truth is that Fine Gael and Labour factored revenue into their Budget a month ago from a planned tax compliance initiative aimed at 115,000 pensioners around the country but failed to inform the pensioners of what was in the pipeline in the hope that their party political interests would be protected.”
“In the budget documents published alongside the Budget on 7 December last, the Department of Finance estimated that an extra €45 million would be collected in 2012 (and €55 million in a full year) arising from additional enforcement and compliance measures by the Revenue. Specifically, the budget document explains how €45 million would be raised in 2012:
‘In recent years the Revenue Commissioners have sought and obtained an increase in their ability to obtain information on payments made by Government bodies and others to third parties. In addition, the Commissioners have continuously upgraded and extended the range of information they receive from the Department of Social Protection. This additional compliance activity from these new and enhanced information sources allows the Commissioners to improve its collection.’ (Page B8 ‘Summary of 2012 Budget and Estimates Measures – Policy Changes’).
Deputy McGrath further commented, “While the Government has sought to hide behind the Revenue since news emerged of this initiative targeted at pensioners, the truth is that the Government factored in to its Budget a month ago the expected yield from the initiative. The Government made a political choice not to reveal the details of the initiative at Budget time and instead allowed the Revenue to scare the living daylights out of thousands of pensioners around the country this week.
“While every citizen has a duty to be fully tax compliant, the manner in which this initiative has been handled has caused widespread confusion and unnecessary fear among pensioners. The Government could have put the full information of the compliance initiative in the public domain as part of the Budget to allay the concerns of pensioners all over the country. This would have allowed pensioners to be fully informed. Instead, the Government chose for pensioners to receive an alarming letter from the Revenue out of the blue, watch the reaction and then hide behind revenue officials.
“The Government should now come clean and acknowledge that it has been aware for some time of the initiative launched by the Revenue this week. In addition, the Government should consider adopting a better approach to the other areas intended for compliance initiatives as part of Budget 2012. Through a proper public information campaign about compliance and enforcement initiatives, compliant taxpayers can be reassured and those with an outstanding tax liability can be given the information they need to bring themselves into compliance.”