Another budget one. Sorry.

It's the indirect part that spirals though.

I have an accountancy practice. My wages costs are going to go up by £10,000 a year due to the NI changes. If I want to give my staff the same pay rise I would otherwise, that's going to be even more.

One of my clients runs a motor repair garage. If I put their fees up to cover my staff wages, my client is going to have to put up their fees to cover their staff wage increase AND the cost of my price increase.

They, therefore, will want to charge their customers more. They do a lot of servicing, so that's a direct increase in cost to people getting their car serviced by them. They also do a lot of repair work for insurers, so they'll start charging the insurer more.

If the insurer is paying the garage more, they'll want to increase the cost of motorist's premiums...

And so it goes on.

And that's just the impact of the NI increase. The IHT rule change for farmers will mean some farmers might now just pack it in and sell up. The number of farms will reduce, meaning less produce and more imports, putting up the cost of living even more.

So, while on the face of it, it doesn't seem to affect most people directly, the impact is going to be wide reaching and for a long time.

If taxes rise, it will affect everyone in the country.
The rich paying more school fees through vat, will have less disposable income to maybe, pay for a cleaner (as an example), or they will move their child to a state school (which will affect those in the schools).
This is just a simplistic affect (I do not have any DC at private schools)
In the same way, if Busniess have to pay more in NI, and NMW, they will cut costs elsewhere, by cutting staff, no planned pay increases, higher prices for services or goods.
This will cause inflation to rise, etc

Yes on its own the snippet you posted doesn't tell me much, so can't you just post the entire thing?

Source at bottom clearly says HM Treasury, OBR

@hydriotaphia but yes you are correct, I'm fuming with Labour.
The only country in Europe to tax any form of education. It is purely a revenge tax and Labour have ignored guidance from: teaching + Headteachers unions, accountancy firms, the update from IFS, SEN charities etc etc who all wanted a pause/end to the policy.
It doesn't make fiscal sense and is downright immoral if you start from the basis that any form of education is good.
All dressed up in lies, obfuscation and shockingly divisive language and petty tweets from Phillipson.

Link? This is not the same document I was referring to.....

No it literally doesn't as shown in the OBR own figures:

It's been committed to since 2023.

Do you live in a bubble or have the power to fly? Just wondering how you avoid pavements, have your bins emptied, see as you walk/drive due to lighting? Also, who would you call if you needed an ambulance?

Tax on packaged alcohol is increasing in line with RPI. Only tax on draft served alcohol is decreasing

Yes it does. Again this is set out in the document:

"After recovery of VAT on their costs, on average the government expects schools to be liable for VAT amounting to approximately 15% of fee income, though this will vary between schools."

You seem to really want this policy to be fiscally ineffective. Of course, you are correct that if the independent sector shrinks by massively more than 7% of pupils (the IFS upper projection used in the budget) then the figures will be different and if enough students leave then it will no longer be a net benefit. But there is no credible report suggesting this will happen (and you haven't provided a link to any report that does suggest it).

I am sorry this policy will be negatively affecting you personally. But I think that your upset about this, which is entirely understandable, is causing you to twist the available information.

Reeves’s long-term spending figures almost as unrealistic as Tories’ were, IFS says – UK politics live https://www.theguardian.com/politics/live/2024/oct/31/rachel-reeves-autumn-budget-labour-tax-rises-uk-politics-latest?CMP=share_btn_url

One for your dh.

@Beezknees i wouldn’t bank on that pay rise!

Higher taxes don’t translate to better public services though and actually I for one want to see less govt not more but I don’t get an opt out !

Yes there will be many indy schools closing. Not the famous ones like Eton, but many of the smaller ones especially those serving rural communities or SEN ones.

I don't think I will be hugely affected unless I'm missing something.

I work for a very large multi national company who can afford to suck up the NI increases and they do increase our wages every year with inflation.

I am not due to inherit anything other than my mum's house which is only worth about £150k.

No DC at private school or anything.

Prices for some things will probably go up so may find myself paying more for services. Not a massive deal as I'm due a pay rise in January, so I likely won't be any better off but not worse either.

You seen to be just coming on this tread shooting other peoples opinions down without sharing your superior knowledge by posting any comment yourself

The OP asked if anyone else was benefiting, well my sister who is a carer for our mum can now earn more before having her carers allowance removed.

The Liz Truss budget cost my family £300-£400 a month more in mortgage payments.
This budget has a net zero effect on our income and immediate outgoings.

I work for a Local Authority, Ive had below inflation pay rises for over 10 years, low or non existent pay rises wont be anything new to me.

Of course some companies may pass their increased costs onto customers -such is life.

Employers always loudly protest about any NMW increases, any extra bank holiday etc

However some companies such as Amazon, who pay limited UK tax as they are registered abroad, will now have to pay increased tax via NI contributions as this is more difficult to avoid.

The conservatives didnt do farmers any favours either- several farmers local to me drove their tractors up to Westminster to protest just a few months ago about post brexit trade agreements that disadvantaged them.

The conservatives have bought the country to its knees with its in fighting, brexit and self serving policies. Both the NHS and Education - services my family use- very noticeably declined under the last government.
Pay for most people hasnt kept up with inflation.
Something needs to change and if we need to pay more taxes for the public services we need then sobeit.

I appreciate that you know the sector better than me. All the parents I know at private school, while not rolling in wealth, are able to manage the payments, at least for a while.

If you are right in what you say, the private school sector will fold in a couple of years. If 1000s are leaving now, mid year, then even more will leave at natural points of change. I think that private schools do have their place, so it will be a shame if that happens.

Do you have a pension? You’re likely a shareholder in one of those ‘moronic’ businesses 🙄

Why would they spend savings to help buffer for redundancy etc? Not sure why you find it so hard to believe that everyone has a tipping point. Every household has a budget that they can't go above.
Fundamentally I don't care if you believe me or not, I can only go on what i know and have seen. Oh and the 1000s of other such parents

Yes, I could, we've got some savings.

And I do find it hard to believe that 10% of parents at your DD school have no savings at all.

Regarding business putting their prices up, well that would mean yhey do have to pay even more tax, so there is only an amount that will make sense.
Not for small business, but large ones will have to consider reducing their idiotic profits and the moronic bonuses. Have you ever checked how the wealth distribution graphs are looking these days? While the working, middle class and pensioners have to watch their smart meter daily?

Probably because you believed Labour when they said only wealthy people use indy schools?
Could you afford to pay extra 2K on mortgage or rent between January and June? Because it's the same comparison

It also doesn't take into account VAT recovered by schools as part of the policy change

I'm surprised purely because I am surprised there are spaces in good state schools. The best schools around here are over subscribed but there are some spaces in the less good schools, so I guess the kids would go there.

I am also surprised because it's very disruptive. But I can see that if 2K can't be found it can't be found. I think I had not realised just how close to the wire so many private school parents were.