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According to a study just published by the European Commission in most EU countries, EU citizens from other Member States use welfare benefits no more intensively than the host country's nationals. Mobile EU citizens are less likely to receive disability and unemployment benefits in most countries studied.
The European Commission has referred The Netherlands to the EU's Court of Justice for failing to notify measures to stop discriminating against pensioners who live abroad when paying out an allowance for elderly taxpayers.
This results from a discriminatory condition under Dutch law for entitlement to the 'koopkrachttegemoetkoming oudere belastingplichtigen' (purchasing power allowance for elderly taxpayers).
Dutch legislation which entered into force on 1 June 2011 provides that the allowance is paid to persons aged 65 years and above who can show that at least 90% of their world income is taxable in The Netherlands. This condition means that in practice the allowance is not granted to people living outside The Netherlands. The Commission has received a large number of complaints from citizens.
Under EU law on social security coordination, entitlement to an old age benefit cannot be conditional on the pensioner living in the Member State where he or she claims the benefit. This rule enables pensioners to move to another Member State when they retire whilst retaining their pension.
As the purchasing power allowance is paid to people 65 years of above, which coincides with retirement age in The Netherlands, the allowance is classed as an old-age benefit under EU social security coordination rules as interpreted by the EU's Court of Justice. Therefore The Netherlands is required to pay the allowance to recipients of a Dutch statutory old-age pension who live in another EU Member State, Iceland, Liechtenstein, Norway or Switzerland.