Michael Gove proposes imposing VAT on private school fees

[OCSockOrphanage]

In an Op Ed piece for The Times today (Fri 24 Feb), teaching's Nemesis suggests that school fees should be subject to VAT at 20% so the revenue can be ploughed into improving state provision.

Link

Opinions? I reckon there will be a few?

[ChazsBrilliantAttitude]

What do you think?

[ChestnutsRoastingOnAnOpenFire]

That idiot forgets that without private schools his government would be funding the cost of educating our children. We save the state thousands per child. What a plonker.

[relaxitllbeok]

He's just trying to make a quick buck from the article. They can't put VAT on school fees till we leave the EU (and if they do afterwards, hope you all like the VAT on university fees that would be needed for consistency) and he can't change the charitable status effects without special legislation, and I don't for a moment believe that a Tory government would agree either move anyway.

Personally I'd support more tax to support state education, but only if it's levied on the basis of what people earn, not if it's based on what they choose to spend their taxed income on.

[ChazsBrilliantAttitude]

Great idea
Put VAT on fees so fees become more expensive. Consequently, some people leave the private sector. They put their children into a state school which the taxpayer has to fund.

Has Gove calculated
Potential VAT received less increase in State school funding needed from people now priced out of private education?

[missyB1]

Nothing that comes out of that incompetence idiots mouth would surprise me.

[Florin]

It will never happen if school fees go up 20% over night they will have to find state school places for large quantities of children as many parents will no longer be able to afford it which would give the government a bigger issue.

[WelliesandFlowers]

I really dislike that man. Sorry but my child is in a private school because of special needs. This would make it extremely difficult for me to give my child the education I think he needs. He would then be back into mainstream and need some 1 on 1 (which the school system can ill afford).

[OCSockOrphanage]

My first thought was, "Is he making a bid to win his old job back so he can finish what he started." (Where should the question mark appear in that construction?)

Hope Relax is right that it can't happen as long as we remain in the EU as we are reluctantly back to paying fees after three years in two failing schools, and have 18 months left.

But I think there will be people who jump on the idea. Perhaps some will arive during lunch break .

[Claireblunderwood]

I half agree with him (kids at both state and private) but I'd agree a lot more wholeheartedly if his daughter wasn't in one of the most sought-after state schools in London with an admissions policy running to several pages. Part of the reason we went private for secondary was as atheist parents with unmusical children, we weren't in a position to get our children into elite London schools and so were left with schools that take a disproportionate number of the children of the less motivated.

Bloody politicians - none of their kids ever seem to go to 'normal' state schools. How can it be that Clegg in Putney and Blair in Islington (ie 10 miles apart) can have children in the same school. There must be about 50 schools between them.

[Lohengrin]

Gove is an inadequate idiot. This is a completely unworkable suggestion designed to attract cheap headlines and get him back in the limelight...boosting his bank balance in the process. Yawn

[MrsBernardBlack]

I'd agree a lot more wholeheartedly if his daughter wasn't in one of the most sought-after state schools in London with an admissions policy running to several pages.

Exactly! If schools of that quality were available to more people all around the country, many of the private schools would probably go out of business.

Apparently he's going to Eton tonight to talk about Islamic extremism .

[Genevieva]

Gove is spouting nonsense for attention. VAT is an EU tax - collected and spent by national government, but an EU regulated tax nonetheless, which is why it was so hard to get VAT removed from tampons. My understanding is that educational activities are inherently exempt from VAT (as they should be otherwise every music, ballet and extra Maths lesson would also have to be subject to VAT). Attempts to word legislation so it only applied to private schools might be seen as a punitive attempt to bankrupt private schools would also break EU laws on competition. I know that many independent schools have felt protected by EU membership from governments that might want to use them as easy targets for scoring popularity points.

[meditrina]

Well, with Brexit the rules can be rewritten for a consumption tax (successor system to VAT).

Taxing education is a possibility, the fees for crammers for example (where you buy just the courses, not a full school or university life) are already subject to VAT.

The possibility of unintended consequences on this one are quite high, though, given the different legal status of different schools.

And how the state system would break if there were a rapid outflow of pupils from independents.

[Northernlurker]

I'd like to see the debate on parliament on this one!

[ClashCityRocker]

Out of the eu, they can do what they want with regards to vat.

They won't scrap it, as its one of the most efficient taxes. They might repackage it, but I suspect there won't be major changes from the current system - at least not in the near future.

I think it's a daft idea re private school fees. Interesting politically. Seems a bit of a departure from normal Tory policy. Maybe they only want the super-rich to access private education though.

I suspect the more successful schools would be able to absorb some of the cost, but it would be the end of smaller schools.

[HPFA]

Gove's inconsistencies are mind-boggling. Parts of the rest of the article appear to be an argument for maintaining the status quo re comprehensives/new grammars. Well, I'd certainly agree with that but a while ago he was saying he supported new grammars - presumably in an attempt to get back into Theresa's good books. We can only assume he has failed there.

As for the VAT thing - there is no chance of it being implemented so we can assume that this is a pathetic attempt to paint himself as some kind of social radical. And perhaps he'd like to add to his apology on failed UTCs by apologising for the ridiculous amounts of money wasted on free schools:
schoolsweek.co.uk/unfilled-spaces-and-30m-land-deals-nao-takes-aim-at-free-schools/

[OCSockOrphanage]

OP responding. I am not sure on this TBH. If my local school was in any way the equal of Holland Park, or even good, I'd be cheering (I think, but wincing too). But it ain't, and nor are any of the options available to my DS because ours is a huge rural catchment where academic prowess rates way below rugby or daffodil picking.

[deekarma]

There is no question. VAT should be added to fees. It's a luxury. If tax means you can't afford it, so be it.

[OCSockOrphanage]

This thread needs, and is missing, the input of regular posters on education. Please, weigh in hard.

I do know that this is slightly provocative but I am genuinely flummoxed about the outcomes and provision that MG has in mind. I know teachers hate him, but I do believe he has the best interests of students at heart and is not shy about saying they are being sold short.

[scaevola]

VAT isn't a luxury tax. It's a general consumption tax.

When we leave the EU, we can replace it with a luxury tax if that is what is wanted.

There used to be a luxury tax before we joined EU, and it had to be replaced with VAT as part of joining. The erroneous linkage of 'luxury' and 'value added' is remarkably persistent

[Londonsburningahhhh]

GOVE

My daughter goes to the first academy that he opened up. Can anyone guess what school I am on about. A parent from a top private school funded it. I am not a fan of Gove.

[Londonsburningahhhh]

Wouldn't a lot of parents with VAT registered businesses claim back the VAT?

[workingmumsarebad]

I am a single mum who works her butt off doing two jobs to put her child through a private school.

why because the top rated school which I can see from my front room ( 20 metres away) was over subscribed and we did not get a place. That kids from 10 miles away got a place and we were told there were 82 children who lived closer than us - there are 11 houses between us and the school and 8 of them have OAPs in!!!!! Where did we get the worst school in the county a 10 mile drive away.

I went to take a look at it in one corner were the Polish children with their TAs and translators, in the other corner with the Lithuanians with TAs and translators, in the middle were a predominantly pakistani group with the same, to the right at the back up, the walls and under the tables were the children with special needs and in the back left corner were the rest - suitably ignored as theTAs and translators dominated the class, asking for repetition, time to translate etc. I felt so sorry for the teacher - who had no time to see to the children at the back by the time the translators had dominated everything - she looked harassed.

20% VAT would quite frankly break me - I am prepared to sacrifice lots for my DC, but that would pretty much put an end to it, Am not sure how I could work any harder to find that monies.

[OCSockOrphanage]

Okaaaay.

My perspective is very rural SW UK. Our situations are not the same. I would like my child educated for a job in California, if he has what it takes. The local schools think they are doing well to get their students in any McJob. That is a huge chasm.

[AnotherNewt]

The article is behind a pay wall, so I can only see the first two paragraphs, and in them he us talking about ending charitable status, not imposing VAT on fees (they are totally separate issues, as fees are VAT exempt because of EU rules that govern that whole tax regime and which exempt education fees - as PPs have noted - all schools and universities.

Under the charity law as it stands, you cannot remove charitable status. There is simply no mechanism for taking charitable assets and turning them into private ones. You have to wind up the charity, sell all real estate and major assets at market value and donate proceeds to a similarly-aimed charity.

Does he go on to call for a one-off new law that would permit the privatisation of specified charities? And if so, will all charities which offer education be consulted?

The 'value' of charitable status is estimated to be worth £200 per pupil per term in VAT not collected from the (non-educational) activities of schools. Which is way less than the variation between the fees of schools anyhow and would be easily absorbed.

If there was a good mechanism to make that possible, then I think there could be a good welcome for that.