Age Action, an association that represents the elderly, said some older people had misunderstood their obligations and called for a public information campaign.
Arrangements have been made for an emergency meeting of the parliamentary finance committee this week. Two state agencies, Revenue and the Department of Social Protection, will be called to attend and explain their actions.
Fine Gael TD (member of Parliament) Billy Timmins, a member of the committee, said Revenue’s approach had caused unnecessary concern for people.
Revenue defended its decision to communicate with taxpayers directly. It said public information campaigns didn’t work as well as individually tailored information. It also defended sending out the letter in January, because this would allow the tax liability to be spread out over the entire year.
Revenue also acknowledged they set aside existing rules by sending out letters informing pensioners they will have to pay extra tax.
Under previous rules, Revenue staff did not review pensioners’ tax liabilities unless the person sought such a review.
A retired tax official told The Irish Times, “It was considered more trouble than it was worth.”
He described the Revenue’s decision to seek extra taxes from people who are receiving both a state pension and a private pension as “a cheap shot,” akin to “shooting fish in a barrel.”
Brian Hayes, minister of state at the Department of Finance, said that in the great majority of cases no arrears will be due.
Fianna Fail spokesman on social protection Barry Cowen criticized the Revenue’s handling of the affair. “These pensioners have essentially been labeled tax cheats. This has caused great distress and confusion among many of our most vulnerable older people,” he said.
Columnist and TV host Brendan O’Connor wrote, “Chasing pensioners for back taxes is, of course, technically correct. But it just looks bad, particularly when guys who owe us and our banks billions are still living the good life and seemingly not intending to pay us back at all.”
Dead pensioners paid by the Irish state in $25million sting