it's daft to think parents with kids in private school have money to burn?

[Popgoestheweaselagain]

Just got asked by my school what would be the impact if they had to pay VAT, adding 20% to fees. My response was 'I'd try to keep my child in the school, but ....'. I think almost all parents would respond this way. Alarmed, did a quick google, and found this is Labour policy. Next time they come knocking at my door looking for my vote, I'll be telling them why they can't have it!

Now, I understand why some people are ideologically opposed to private schools, the unfariness etc. But when I hear this argument that goes something like 'Those people must have loads of money because they send their kids to private school' it kind of annoys me. Money is finite. If you've spent all your money on school fees, you obviously don't have it anymore!

Actually, I think we are all ware that "Rich" people do very well at avoiding tax.

There is a loophole which many wealthy families use for paying school fees without paying tax on the income. Grandparents can gift shares in a company, parents cannot, therefore this is available to families who have always been wealthy. So an example could be wealthy grandparents with estates and property can package a parcel or two into a company give the shares to be split between the grandchildren who use the profits to pay their own school fees. Whilst they are under 18 they do not pay tax on dividends. This is a very easy and inexpensive accounting practice use by the old rich families.

New rich can of course fiddle away with tax havens etc.

It's the not actually "rich" people, but somewhere in the upper middle income who are paying tax first.

Gosh! Didn't expect this number of replies. Like I said, I understand why, in principle some people think school fees should include VAT and/or private schools just shouldn't exist. The problem is this: imagine, instead of talking about private schools, we were talking about mortgages. Would any of you be happy with your mortgage going up by 20% each year? Would it bother you if people said 'oh, well, you'll just have to move to a smaller house'? Obviously, if you'd known about the 20% rise, you'd have bought a smaller house. But you've moved in now and your kids have made friends on the street. It's not easy to move now.

If they were saying something like 'We're going to scrap the VAT exemption, giving a 10 year warning' that would at least give people time to prepare. Suddenly doing it, is going to be a disaster for schools, families, children and staff, and will also impact the local schools, which will suddenly have to find extra places. That school you'd set your heart on? Forget it. You're no longer in the boundary. It's filled with all the kids who live closer and aren't going to private school any more.

Education is not a luxury. It is a legal right.

Good quality state-funded education is available in some geographical areas, and not in others.

Bit like healthcare. If a cancer patient with a worsening condition is on a year long waiting list for NHS surgery, is it a ‘luxury’ if they pay for private surgery? Or is it a sign they’ve been badly let down by the state-funded system? (Which they’ve already paid for through tax, btw.) People die of treatable problems while sitting on NHS waiting lists.

In the same way, private education is not a luxury. No one wants to spend tens of thousands of pounds on education. Fact is, huge numbers of state schools are shit, with widespread physical bullying, sexual harassment and failure to educate to the top grades. Maybe Labour should think about improving failing state schools, instead of whipping up old-fashioned class hatred 🙄

Labour, take note: it is statistically impossible to get elected unless you stop alienating the middle classes.Tony Blair understood this, why doesn’t Sir Kier?

Exotic holidays, expensive cars, and expensive weddings do not afford life-long advantage in the way that a private education generally does.

It’s not a luxury when you’ve only sent your kid to private after their SEN
needs were worsening in mainstream and there is no suitable state provision locally. My kid (ASD, ADHD & Dyspraxia)simply couldn’t cope in a class of 32 and a school of 1500. He was bullied mercilessly and fell through the cracks in the school support system, attempted suicide age 12 and after most of year 8 joined a small, local independent school from year 9. He managed his GCSEs on time and went back into state school for 6th form (thankfully granny and grandad could help with the 3 academic years worth of fees)

All state schools get a ‘per student, per year’ budget (around £4,000 -6,000 dependent on local factors).
If the government would allow that amount to follow a child to an independent school, with parents topping up the difference, then yes, I think it would be fair to put VAT on the difference.

Kids like mine would cost the state a fortune in one to one or Vulnerable Pupil Referral Unit provision + knock on costs of worsening mental health + potential long term joblessness due to a lack of schooling.

Most independent schools are nothing like the handful of posh ones you see on telly.

Tedious straw man argument. Education is a massive driver of social equality. Marriage in a registry office isn't.

I know several people who went to state school , didn't do well but worked bloody hard when they left, and became very successful. People can and do 'fail ' school but still do extremely well in life. I know people who've finished private school and have gone on to not do well at all . I'm neither for nor against private school . I am def very much for freedom of choice

But no one thinks this policy would send 'half' of private school kids into the state system.

Even the Independent Schools Council thinks it would be more like 17% - or 90,000. Even if you assume an average per pupil spend of £8000, that would cost about £720 million, while the VAT change would bring in £1.6 million.

So this policy would still have a positive revenue impact of more than £800 million that can go into the state system EVEN AFTER accounting for the 90,000 new pupils in the system.

The other benefit which I've not seen anyone else mention is that the problem with private providers is that they usually end up with lower costs because they get the 'lower need' service users. Of course private schools can provide excellent results. Aside from their revenue, they are largely educating kids from upper middle class backgrounds and above, with parents who are invested in them having a good education, much less likely to have SEN, much less likely to come from troubled backgrounds etc.

Of course the problem there is that that means the private sector can cherry pick the 'easy' kids, while the vast majority of the difficult kids have to be educated by the State. In reality, the cost to educate a non-SEN, middle class kid with involved and interested parents is much lower than the cost to educate a kid with SEN who is living in poverty or dysfunction. So an influx of 90,000 'easy' kids into the state system would have broader benefits in terms of the overall profile of state pupils.

Same! Got my vote.

I think Labour’s point is that private schools shouldn’t have charitable status which makes private school fees exempt from VAT. Not that private school parents have loadsamoney and should stump up more (although the majority probably have more money that people sending their kids to state schools.)

Their policy is to use the money gained back from removing the VAT exemption to help fund the post covid catch up for kids from state schools. State schools that didn’t have the small class sizes, laptops, plenty of staff and admin staff that helped private schools do so well at coping with home schooling.

Seems like a very fair policy to me.

If it does get implemented, those that can afford the extra 20% in fees (if private schools chose to pass this entire increase into parents instead of absorbing some of it by cutting facilities or bursaries or sports or making the uniform cheaper) can go into the state sector. Those who can afford it can continue to pay. So it isn’t as if all the kids currently at private schools will flood the state system.

Private healthcare, private cars, private houses etc. are all taxed, why not private education.

Most people in positions of power in this country have been privately educated. Please don't try to argue that state educated children have the same opportunities because it is statistically, provably untrue.

Here we go again! So you do know that if say 50% of those using private go back into the state system the schools wouldnt have space for say your child and that people are using tutors to pass the 11+ and that its funny how leafy areas, upmarket areas often have the best state schools.

Its the politics of envy. Some people commenting have clearly never set foot in a private school and PP who are saying that if you can afford private school fees you can afford ANY hike in the fees are being plain daft.

Problem is living in those areas is out of reach of some people so they end up with the inadequate schools.

I don’t get it..if the fees rise then honestly, the majority at our school would take their dc out. We have 5 at private. We can’t afford to pay a penny more for school fees. Nor can many others at my childrens school. Statistically speaking, if all mine were put in the state school, bearing in mind class sizes are 30, I’m adding to the class size by about 17%.It would also ever deepen the divide between rich and poor as only the real super duper rich will be able to afford school fees. The middle earners will be priced out, so the schools would
more ‘elite’ than ever! At the moment we are happy to contribute a lot of tax for a system we don’t plan to use, whilst not burdening the state system. I think it works well.

Maybe Labour should think about ways to fund improving state schools. Which is precisely what they're doing.

Labour are better when they build things up than do this stuff for show. Blair knew it and managed to avoid abolishing what was an asset to the U.K.

Oh fgs. What a load of nonsense.

What is being suggested is exactly charging VAT on school fees.

Private schools pay VAT on goods and services that private schools purchase and unlike. VAT registered businesses can't reclaim the VAT.

This is such a silly point. We can argue about the idealolgy of private schools and whether they should exist or not, but the fact is they do and they aren't going anywhere apart from the odd ones on the edge going out of business, whatever government comes in and says. And they know what their market can and can't afford. They know that most parents are at their limits. That's why virtually all discounted a term during COVID and why many have frozen planned fee increases now due to the cost of living crisis. They would simply adjust their fees to account for the VAT and give make up the shortfall by giving out less bursaries/scholarships - which would disproportionately affect clever kids with poor parents. Be careful what you wish for indeed.

And church schools are also private right? Funded and managed by the church. So presumably the VAT would apply there too? I'd be interested to see how many of the idealolically opposed people that gamed their way into church schools because they are better funded would support this. I'd much rather we lost the school's that discriminate against children based on the religious conviction of their parents personally.

VAT on university fees as well? Fancy that?

Well luckily banning them will never happen so I guess I don't have to argue about it really

TBH many privately educated students I saw when I worked in university admissions were pretty thick but had been taught to present themselves as though they were intelligent.

Explains a lot about how certain politicians have got where they are.

@Popgoestheweaselagain You are comparing apples and pears. Mortgage is something different than a private school. Completely different.

I hope your private school is giving your kids a better education in maths than you seem to have.

Unless your five are quintuplets, they probably won't all be going into one class. Which means the increase in class size would be one (or two if you have two in the same year) - about 3% not 17%.

Also, even if you'd take 100% of yours out of private education, actual studies show that only about 90,000 kids overall would move out of the private sector - about 0.8% of kids overall.

No, because there is no child who will grow up to be a contributing member to society.

Plus they are not VAT exempt.

Can’t really sympathise with this, considering some families are literally having to choose between heating their home or eating.

Private education is a luxury, same with private healthcare. It absolutely should be taxed.

That being said I think there should be a warning for 5 years so families can either
a) move their children to another school
b) have time to save up the extra £ before it is implemented

But that is only for the welfare of the children as I certainly wouldn’t want to move my kids from school once they’re settled in and happy.

I doubt it will happen anyway as everyone seems to be dead set on voting Tory until the country is completely fucked, so I wouldn’t really waste time worrying about it, to be honest. There will be much more to worry about than a few extra quid to send your kid to a fancy school once this government is finished.

Says everything that if they pay VAT they don't recoup from profits, they out it right into their clients. That's not the Lavour policies fault, that's their own decision of how to absorb the cost.