Labour, private schools VAT and universities

[BloodyHellKen]

Following on from the thread about Labour, private schools and VAT please could someone explain to me why we shouldn't be concerned that a Labour govt wouldn't remove tax exemption from universities also as they are also VAT exempt in the same way private schools are.

I'm not personally worried about VAT being added onto private school fees and I recognise arguments for and against but the possibility of VAT being added onto a university education does really concern me.

Anyone?

Because it would be electorally unpopular and more people go to university than private school. Also a lot of people don’t pay back their loans ( used to pay fees) anyway so they’d be robbing Peter to pay Paul.

But it would raise a lot of money and more people don't go to university than do which is my concern because from that point of view it is akin to the private school policy.

Also introducing uni fees was unpopular and still is, but it didn't stop it from happening!!

The other argument is that there is no government alternative ( apart from about 2 Unis). All unis are basically private so don’t detract from the state system. However that argument only really works if you buy into the argument that the existence of private schools makes state schools worse , which I’m not sure I do. I suspect that the idea that these MC parents are going to create a state school utopia will give way to a reality where “behaviour grammars” will spring up all over the place.

That’s true but fees were introduced alongside a huge increase in the number of people going to Uni. The old system became completely unaffordable.Arguably that expansion was not the best idea because it just created “qualification inflation”- ie suddenly needed a degree for jobs you didn’t need one for before, and you were paying 30k for the privilege but that’s water under the bridge now.

I don't disagree with everything you've said but unfortunately none of it means that VAT exemption couldn't be slapped on top of uni fees (by Labour) if the need for money was justified IMO.

As someone with 3 children this really concerns me.

I think it would be justified with looking at the effect fees had on uni applications - it barely dented it and now most students graduate with tens of thousands of debt which I think is a travesty.

If the desire was to raise revenue they would just raise the VAT rate.

No one is going to charge VAT on university fees

@Glwysen I wouldn't be quite so sanguine - if education becomes VATable it will apply, that's how VAT works. You don't just pay VAT on goods from Harrods and not the Co-Op, do you?

Private schools are a luxury.

Universities are a necessity.

Of course they're not! Why charge fees then?

Do you not want doctors, teachers, nurses, psychologists and many many more skilled professions to be properly educated and trained then?

Do you not want decent research and data to support the functioning of society?

How can universities not be essential?

Many more people attend university than private school. Those people have a vote. They tend to vote Labour.

Universities do research that benefits society.
Private schools give unfair advantages to a small section of society. They aren’t contributing to the greater good.

Well, we'll see.

Do you mean VAT could be added to students' fee loans? The ones they get (indirectly) from the Government? Meaning the Gov has to stump up more cash upfront? I don't think even this Gov are that thick!

The VAT would be added to the student fees, loans would have to be larger yes. This would be foolish, yes - but think of the local councils who pay fees or the army - in this scenario this policy would increase the cost to the public purse too.

This is a spite policy, in the end a few big private schools full of international students and the children of the super rich from
The UK.

I still can't see it happening. There are free state alternatives to private school so it attracts the wealthy - there is no alternative to paying Uni fees, it's a tax on all. And would bring in net zero in revenue.

I hope you're right.

What about private tuition; music, prep for 11+, or pre-school in private nurseries?

Why are universities not free then like in other countries?

Actually at the last election the graduate vote was pretty evenly split between the two main parties.

They should be.

This is exactly my concern.

Traditionally VAT isn't charge on education as education is (quite rightly) seen as a very good thing. However, if it becomes okay to charge VAT on private education then why not extend it university education as that is also private education. Just because more people go to university than go to private schools doesn't mean the same rule can't and wouldn't apply.

I think things like private tuition are far more likely. That's another luxury for the wealthy to gain an educational advantage over the less well off.

Extra curricular activities in general too, given how important those can be in giving kids the kind of rounded education that makes them better candidates for universities, jobs etc. Music lessons, sports lessons, out of school language lessons.

All those families that get priced out of independent schooling and forced into the state system will have tons of disposable income to spend on this kind of thing.

Or if they don't tax it, independent schools will find ways to cut all of that out of bills that are VAT rated, and provide as much as possible on the side through extra curricular clubs.

This is the wrong comparison. You pay VAT on luxuries. You pay it on luxury goods wherever they come from, but not on food, whether it’s from Harrods or the Co-op. Your comparison is like saying once you pay VAT on shopping all shopping will become VAT rated. Education isn’t becoming VAT rated - luxury education is.
tjis is just scare mongering - you’re saying ‘Don’t vote Labour because of this terrible thing they might do (but have never said they would or indicated in any way they are thinking if and which would in any case be impractical, pointless and against their general principles)’. It’s nonsense. Cynical and unpleasant, too.

I think things like private tuition are far more likely. That's another luxury for the wealthy to gain an educational advantage over the less well off.

You appear to be looking at this from rather a them and us viewpoint. People don't just do things to gain an advantage over the less well off.

We used private tutors and I wouldn't consider us wealthy. We did it because one of our children is dyslexic and they needed the extra support to pass GCSE's.

Also from our experience many private tutors accept cash in hand so I really don't see adding VAT to private tuition would raise much revenue.