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Chicken farmer sues Revenue over failed family business


A Cavan chicken farmer who alleges that his refusal to engage in VAT practices he believed were unlawful meant he was put out of business, is suing the Revenue Commissioners for damages.

Alo Mohan, of Redhills, Co Cavan, says his family business once had a turnover of approximately €2 million a year. He claims he made the Revenue aware of practices that were costing the State “a massive loss of tax income” but that the VAT practices were allowed continue.

“The result has been enormous loss, damage, irreversible character damage, and expense to our client,” Mr Mohan’s solicitors, KRW Law, said in a letter of claim sent to the Revenue.

Mr Mohan lodged proceedings in the High Court last week alleging misfeasance. The action is against the Revenue Commissioners, Ireland and the Attorney General.

In his letter of claim, Mr Mohan said that he agreed over a period of years to “comply with instructions” from a food processor in relation to de-registering for VAT, operating under the flat rate VAT system, and paying a higher than market rate for feed while being paid a commensurate higher price for chickens.

It was made clear to him, he said, that failure would “result in an uncertain future”.

Flat-rate payments are payments made to farmers who are not registered for VAT, to compensate them for VAT paid by them for goods and services connected to their business.

Unlawful

Mr Mohan said he implemented the requested measures for a number of years but that, when the processor asked that he become involved with another group, Mr Mohan declined, having been advised, he said, that the scheme involving the group would be unlawful.



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