Richard O'Donoghue: VAT Confusion Over Broiler Chickens
Richard O'Donoghue addressed conflicting VAT guidance on broiler house chickens, noting contradictory messages from Revenue and the Finance Minister and urging clarity for affected farmers. He said he will discuss the matter with the new Minister of Finance and expects further engagement to resolve the issue.
Revenue letter and conflicting guidance
He described a letter from Revenue's VAT Interpretation and Litigation Branch to the IFA stating that broiler house chickens must register for VAT this year, and recounted apparent conflicting positions with the Finance Minister over whether registration is required.
Scope and scale on farms
He noted that eighty-three per cent of broiler house chickens are on farms that are zero VAT-rated and warned that if producers are required to register as a separate identity they cannot do so under a single tax number - a change that could force them to form a limited company.
Administrative consequences
He said the Finance Minister's approach has created a problematic situation, while Revenue have been described as saying registration is not required; the divergence has led to confusion for farmers and the IFA.
Next steps and response
He stated that Revenue should be the guiding light in implementing legislation, that he will discuss the issue with the new Minister of Finance, that he will send the details, and that he expects further engagement to bring clarity.
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A letter from Revenue to the IFA, VAT Interpretation and Litigation Branch, Indirect Tax Policy and Legislation Division, Revenue Commissioners, sent a letter to the IFA to say that broiler house chickens have to register for VAT this year. The Revenue are saying they do not, and the Finance are saying that they do. The Revenue are saying they do not have to register for VAT. Eighty-three per cent of broiler house chickens are on farms, where the farms are zero VAT. And if they register for VAT as another identity, you cannot do it under the one tax number. So what the Finance Minister has created is something mad. So now they have to form a limited company. But Revenue are saying they do not have to register for VAT. The Minister of Finance is saying they have to register for VAT. And they have also sent it to two members of the Department in this as well. So can you please give us an answer? Do they have to register for VAT, or do they not? I am sure there will be further engagement, Tisha. You expect me to bring clarity to that presentation? I think Revenue is the guiding light, obviously, in terms of – I will discuss it with the new Minister of Finance. But I would have thought that Revenue implements the impact of a legislation, faithfully and dutifully. I will send you the details. I will send you the details. Dutifully and so on. If you could. I know there were some challenges some time back in terms of that entire issue. And there was a reason why I think if I'm on the same case or the same issue as you referenced why change had to happen. But again, I think Revenue will identify what's required. Further engagement.
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