Clause 2 - Functions of board

Part of Tax Credits Bill – in a Public Bill Committee at 11:30 am on 15 January 2002.

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Photo of Dawn Primarolo Dawn Primarolo Paymaster General (HM Treasury) 11:30, 15 January 2002

I got the hon. Gentleman's point. My explanation was logical when applied to the working tax credit, but not when applied to the child tax credit, which is paid straight to the carer. It would be nonsense for the child tax credit to be paid differently simply because it did not go through the employer. That would take us away from the principle towards which we are moving. The system makes sense and there are precedents for it. I was interested to hear that the hon. Gentleman was an accountant. I am sure that he is not against the way in which value added tax operates—it nets off. That principle applies within the system.

We have moved away from how DWP treats its expenditure, and how Inland Revenue will account for that expenditure.