§ 15. Mr. Jim Cunningham (Coventry, South)If he will make a statement on the consequences of the changes to VAT charges for welfare services provided by state-regulated private welfare agencies. [99476]
§ The Economic Secretary to the Treasury (John Healey)From 31 January, all state-regulated private welfare agencies have been able to exempt their welfare services, including home care, from VAT. That means that 60,000 sick, elderly and disabled people will no longer have to pay VAT on their home care costs. Those least able to look after themselves should find it easier to remain independent and to remain in their own home.
§ Mr. CunninghamHas my hon. Friend any plans to extend the exemption from VAT to welfare companies?
§ John HealeyThe VAT exemption applies to state-regulated welfare agencies that provide commercially delivered services. It covers home care agencies, foster 400 agencies and adoption agencies. It puts them on the same VAT-exempt footing as public agencies and charities have always been. It has been widely welcomed because of that. When we announced that, the chairman of the United Kingdom Homecare Association said:
This exemption will make services more affordable for more people.He went on to say that the chosen route of a simple exemption
will be straightforward for providers to implement and readily understood by care users.