Clause 1 - Introductory
Tax Credits Bill
10:30 am
Professor Steve Webb (Northavon, Liberal Democrat)
I beg to move amendment No. 63, in, page 1, line 7, at end insert—
'(1A) The child tax credit shall be a family benefit for the purposes of Council Regulation (EEC) No. 1408/71.'.
I hope that the brief amendment will not detain the Committee long. We must consider the status of the tax credits in the Bill under existing domestic law and European law. European law makes provision for a category of benefits known as family benefits to be treated in a particular way for people who work in one country and have children in another.
The critical element is the European Community regulation 1408/71, as I am sure the Committee will know. The two issues are whether the person comes within its scope, and whether the benefit comes within its scope. A person is covered by the regulation if he is liable to pay social insurance in one or more member states of the European Union and has exercised free movement. We are, therefore, discussing people who move to obtain work in the EU. They may be covered by the provisions if the regulation classifies the benefit as a family benefit. Clearly, the family credit used to be treated in such a way, as did the working families tax credit, which was a renaming of the family credit. That has now been split into an adult part and a child part, and the amendment is designed to make it clear whether the child part, at least, will be categorised as a
family benefit. We believe, and consistency demands, that it should. I hope that the Minister will accept the amendment.