The Cook Islands Financial Secretary, Richard Neves, says if New Zealand pensioners living in the Cook Islands can demonstrate hardship they might be exempted from paying tax.
The government has been under fire over its move this year to get pensioners to comply with long existing tax laws and pay tax as they would have to in New Zealand.
It says about 260 people are liable to pay the tax back-dated for two years.
Mr Neves says some couples have been receiving nearly 25 thousand US dollars a year tax-free while young Cook Islanders earning half that amount are paying tax.
"Each individual's circumstances are quite different. They can be significantly different. And if they come up and see me, in genuine cases of hardship, no one's going to recover taxes. But we just can't do a blanket (exemption)."
Richard Neves says there are a set of guidelines to follow in dealing with hardship cases to ensure consistency.