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If VAT is added on Private School Fees, then it will be added onto University fees as well

539 replies

AgathaCrispee · 31/01/2024 08:06

Does it worry you that this new policy of adding VAT on educational fees will also be applied to university fees as well?

AIBU to think this will put university out of the reach of the majority of families who will support their kids through Uni?

Also, for those who do go the level of debt they will come out with will be really big.

If they can apply VAT to private school educational fees then they've setup a case for Independent schools argue that it must be applied to Uni as well.

Is this going to create a situation where only the wealthy can send their kids to Uni?

I'm wondering why no one is asking this question!!

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Paellaaaa · 01/02/2024 08:45

“Regarding the higher percentage of Sixth Formers in private schools why is this?”

Parents wanting a bit of the unfair advantages the privately educated enjoy with education at A level and UCAS( connections etc)

I wouldn’t worry about music courses. You need to be well off to pay for music lessons for years that will enable doing a music degree. It’s already elitest. And re humanities. Families are struggling to keep their kids at uni, for those kids paying back fees( not the rich who have parents funding the lot) they need to pick Alevels and degrees that give them a good wage in sectors that need a workforce. I’m not sure humanities is that.

Spendonsend · 01/02/2024 08:41

I think the sixth form thing must vary, but in my area the state schools dont have sixth forms. The only option is a big college shared across a whole borough. The idea being it makes more economic sense and can offer bigger range of subjects and become experts in that age. Its actually quite a treck for some students.

Its enourmous and quite a different environment than school. You are supposed to just get on with things. So some people who would do better in a more smaller school environment, with more structured learning feel they need to pay to go to a school sixth form.

meditrina · 01/02/2024 08:37

Araminta1003 · 01/02/2024 08:23

Regarding the higher percentage of Sixth Formers in private schools why is this? Parents thinking best time to invest? Or is it the cohort going through from when fees were still more affordable?

The younger years will now be incentivised to go state at Sixth Form. There will be a knock on effect on unis in MML courses, Classics, Humanities, Music - the courses with higher ex private school pupils on them. Private schools still encourage this.

Our grammar struggles to get pupils to do those types of A levels. Is there going to be forward planning so those are offered at large Sixth Form Colleges? So some students still take those A levels and will still study that at uni?

Fewer DC in Sixth Form than at school when CSA.

Some move in to private sector at that point, probably more than leave it (only a few sixth form colleges attract pupils away from the independent sector)

So the fraction is different because the denominator is different, not sure of the raw numbers.

But the proportion in independent sixth forms has stayed pretty consistent - the figure bandied about has been the (rounded) 20% for years. And I'd expected it to reduce after the raising of the participation age, with more pupils opting to stay on and state sector expanding with demand

Araminta1003 · 01/02/2024 08:23

Regarding the higher percentage of Sixth Formers in private schools why is this? Parents thinking best time to invest? Or is it the cohort going through from when fees were still more affordable?

The younger years will now be incentivised to go state at Sixth Form. There will be a knock on effect on unis in MML courses, Classics, Humanities, Music - the courses with higher ex private school pupils on them. Private schools still encourage this.

Our grammar struggles to get pupils to do those types of A levels. Is there going to be forward planning so those are offered at large Sixth Form Colleges? So some students still take those A levels and will still study that at uni?

EasternStandard · 01/02/2024 07:48

Justifiedcheese · 31/01/2024 23:38

Someone is scaremongering.

This has been a Party Political Broadcast by the Tory Party.

What your post?

Paellaaaa · 01/02/2024 07:39

Ditto the VAT on uni. Tory scaremongering and parents pissed off that nobody cares re them overstretching themselves to pay for private education. A system that disadvantages the rest of the country’s children.

Paellaaaa · 01/02/2024 07:37

Thesmokinggnu

It’s only 5.9% of children in private education up to 16. It apparently jumps up for Alevels. A fraction of 5.9% which by is what we’re looking at will be easy to absorb. The kids above 16 will just end up in big sixth form colleges the rest of us are in. Spread across the country. It’s so not a problem to sort. A tiny number are privately educated. A tiny number will need to move- across the whole country. It’s so not an issue and just Tory scaremongering.

Thesmokinggnu · 01/02/2024 07:22

user1477391263 - and the levy on education is only popular because of avarice and not because it makes sense.

not everyone goes to university or uses a nursery school, I therefore think it is just as valid to charge VAT on universities and nursery schools. Therefore they should just stop playing with young peoples lives in this way and u-turn.

user1477391263 · 01/02/2024 00:09

I’m sure the government COULD choose to start levying VAT on all kinds of educational services going forward. They will not choose to do so, because doing so would be very unpopular.

See also: there is nothing to stop the government levying VAT on kids’ shoes, in the same way it already does for adult shoes. It chooses not to. Because doing so would be unpopular.

TrixieFatell · 31/01/2024 23:46

twistyizzy · 31/01/2024 08:14

But that can happen through Apprenticeships rather than being a full time Uni student

Nursing and midwifery apprenticeships still involve teaching of theory which takes place in a uni. Apprenticeship or university student, the degree is made up of 50% theory and 50% practice. Where else are they getting taught the theory they need?

Justifiedcheese · 31/01/2024 23:38

Someone is scaremongering.

This has been a Party Political Broadcast by the Tory Party.

Thesmokinggnu · 31/01/2024 22:29

Goldenbear - The IFS believes 18% of students aged 16-19 are in the private system. Even if you assume the top 10% are the right kind of people. That’s still 8% that you penalise and hit harder.

that 8% are probably already contributing significantly to the tax burden and even likely have private healthcare.

If 5 of the 18 have to leave and go to the state system where does that money and places come from? Then what happens to the teachers that will be paying PAYE, none of this is taken into account properly in the papers that Labour are saying make sense.

Araminta1003 · 31/01/2024 22:23

“Remember that, even if the wording is not completely precise and might arguably cover some non-school educational services, there is nobody who will actually want to make that argument in court. “

OK but you know what trustees of charities are like they will want clear cut advice from professionals stating no VAT has to be charged. They need to know that for sure as they won’t take on the roll if there are legal risks.

minipie · 31/01/2024 22:13

Remember that, even if the wording is not completely precise and might arguably cover some non-school educational services, there is nobody who will actually want to make that argument in court.

The non-schools who are arguably caught obviously won’t want to say the wording covers them too.

The government won’t want to, as it clearly wasn’t the intention behind the legislation and would be a political own goal.

The private schools who are caught won’t be able to argue that some non-schools are also caught, because it doesn’t directly affect them (so they don’t have standing). And I doubt they’d want to anyway.

This contrasts with the Jaffa Cake case where the manufacturers had an obvious motive to argue about the definition.

DdraigGoch · 31/01/2024 21:50

Spendonsend · 31/01/2024 10:56

I agree it makes no sense.

I was just trying to explain its not the charitable status that makes them exempt from VAT. So if Labour get in, when they write the new VAT law, they will write it to cover private schools they wint just say 'vat on education' as universities provide education.

How do you word it though so that VAT is applied to some types of education, but not others? Without leaving loopholes to be exploited.

Do you say that provision of educational services to under 16s is considered a "luxury" but to over 18s it's not? Where do sixth form and FE colleges stand? What about extra-curricular classes, will they be taxed and how do you define them? What about tutoring, should that be taxed? Do you say that Kumon's remedial teaching is exempt but anything that goes beyond that isn't? It's a real can of worms.

With physical goods things are much more clear-cut, though that didn't stop there being a court case over the matter of whether a Jaffa Cake was a chocolate-coated biscuit for the purpose of taxation.

I've a feeling that they'll shelve the idea once in office. Particularly considering that they've stated their opposition to any divergence from European legislation - taxing education is banned by the EU.

Goldenbear · 31/01/2024 21:31

Vermin · 31/01/2024 08:22

To remove charitable status is not legally feasible and would take longer than the first term of office, and would affect large numbers of charities because of the way the legislation is drafted. That’s why that approach was dropped. VAT is a separate issue - all charities pay/ charge VAT on goods and services which they consume or supply and which are vat rated.

VAT is chargeable on a class of goods / services. Education services covers way more than private school fees so will affect a lot more people than starmer’s soundbite suggests. And it still won’t raise a fraction of the cash that adjusting eg non dom / corporation tax off shoring regimes would. It hits the wrong people for a small amount of benefit but ignites a good argument, based on “if I can’t have it nor can they”. Local authorities who use private education services for special needs pupils will be paying it (but will claim back as througput). People who use tutors will be paying it. Language schools will charge it - another barrier to successful immigrant integration. There are so many more impacts of this lousy policy but fuck the rich, eh?

Sorry but how does it 'hit the wrong people', for a start it is a very small percentage of people that attend private school, by default they're the wealthy. Like everything the systems and structures just benefit the very wealthy now, it is the principle of the situation that is therefore being challenged! The dissonance is too intense, people want to see a resolve of that gap between the richest and poorest people- In 2020, the ONS calculated that the richest 10% of households hold 43% of all wealth. The poorest 50% own just 9%. It is physically evident everywhere you look and is thoroughly depressing, who wants a society that is so unequal. Even those that were once financially well off, have limited purchasing power and debt, resulting in the state of the economy being dependent on the very rich, this is not exactly a good prospect for most of the population! With this being about tackling that principle, I think university fees don't come in to it.

Lindaofoxford · 31/01/2024 19:56

It was just a few days ago.

If VAT is added on Private School Fees, then it will be added onto University fees as well
Araminta1003 · 31/01/2024 19:21

https://www.gov.uk/guidance/how-to-close-a-charity

Losing funds or funding is one of the listed reasons.

Algamations/mergers are definitely allowed with permission. Maybe we will start seeing the equivalent of MATs in the private sector with lots of offsetting of input/output VAT/land sales etc. I always thought the competition between private schools is a bit strange and similar ones should at least streamline their admissions processes. They could save a lot of money that way and also on marketing if they sit in one big private school MAT.

How to close a charity

Tell the Charity Commission if you close a registered charity. You also need to make sure any property or assets are dealt with.

https://www.gov.uk/guidance/how-to-close-a-charity

Spendonsend · 31/01/2024 19:03

Araminta1003 · 31/01/2024 18:46

Does anyone know if private schools can voluntarily give up charitable status?

If they have to tax pass on VAT on fees to parents and don’t get business rates exemption anymore and are treated just like private schools making a profit, but still have to do charitable stuff like bursaries and community engagement, then are they not actually going to be incentivised to give up their charitable status? And what then? Are Labour going to fund hockey pitches and swimming pools again?
I think the top 100 rich private schools will keep the charitable status as they can still attract donations but the rest, why would they keep it?

The College of Law was a charity that provided education. It gave up its charitable status to become The University of Law. Part of that process was setting up The Legal Education Foundation.

cyclamenqueen · 31/01/2024 18:54

Giving up charitable status is very complex legally. The charity is a legal person in its own right .

Araminta1003 · 31/01/2024 18:46

Does anyone know if private schools can voluntarily give up charitable status?

If they have to tax pass on VAT on fees to parents and don’t get business rates exemption anymore and are treated just like private schools making a profit, but still have to do charitable stuff like bursaries and community engagement, then are they not actually going to be incentivised to give up their charitable status? And what then? Are Labour going to fund hockey pitches and swimming pools again?
I think the top 100 rich private schools will keep the charitable status as they can still attract donations but the rest, why would they keep it?

coffeeaddict77 · 31/01/2024 18:43

Thesmokinggnu · 31/01/2024 18:20

coffeeaddict77

i am probably screaming into the void here

but there are many of the 7% who would now have to go to state, and then what about those that have a bursary and so would have to leave because the bursary currently makes it affordable.

suddenly the numbers shift and the policy makes HMG a loss and just costs ordinary people. Then the gap widens to the most privileged in terms of social mobility. All for sound bites at an election they will win anyway.

Edited

I appreciate that some people who might have gone to private schools maybe wouldn't if VAT was charged but if the money from VAT was used to increasing funding for state schools it would be fairer overall. It would probably be better if they only charged a low amount initially though and they could then see what happens.

Hercisback · 31/01/2024 18:26

https://www.thesecretgarden.org.uk/

What about these types of independent schools that cater for SEN provision and are often paid for via EHCP funding. The most vulnerable children will be back in schools they can't cope in.

Obviously my dream is for a fully funded state sector that is so good private isn't needed. But 1% budget increase isn't going to achieve that.

Home | The Secret Garden

The Secret Garden

https://www.thesecretgarden.org.uk

Thesmokinggnu · 31/01/2024 18:20

coffeeaddict77

i am probably screaming into the void here

but there are many of the 7% who would now have to go to state, and then what about those that have a bursary and so would have to leave because the bursary currently makes it affordable.

suddenly the numbers shift and the policy makes HMG a loss and just costs ordinary people. Then the gap widens to the most privileged in terms of social mobility. All for sound bites at an election they will win anyway.