To think that people who agree with VAT on private school fees but not on university fees, are hypocrites?

[Blanket601]

If Labour add VAT to private school fees, they should also add VAT to university fees. Or no VAT on either. The principle and rule, should be the same.

Why is only private school education being platformed. I think we all know why.

Is anyone tracking how many more private schools are taking teachers out of TPS?

A local private school that seems to be doing rather well has just done this! Quite shocking really.

It's another area where the government funding is more generous to state schools than private - because

(1) central government supports state schools' contributions to the scheme following recent increases and until the next review and
(2) the scheme is unfunded, meaning contributions go straight into the government pot and thus taxpayers are at risk if the fund can't pay the defined benefits; so the more private schools opt-out, the better for the future taxpayer.

(1) and (2) are typically omitted when people compare the £8k per pupil state school cost to the £16.7k average independent school fees.

For those seeing all the ways schools and wealth managers are suggesting may work to dodge VAT and getting p’d off… loopholes are being taking into consideration too, so unlikely to work.

“loopholes are being taking into consideration too, so unlikely to work.”

Yes I am sure that is what the politicians would say. But at what cost to us the taxpayer? How far are they going to go to make those private schools pay? Will they waste hours and hours of valuable time on it and reinvent the whole VAT system just to get at the private school parents?

Money that should be spent on tax dodgers
and
benefit fraud

Benefit fraud costs the taxpayer around £8bn, many multiples of the optimistic IFS school fee VAT estimates.
https://www.gov.uk/government/statistics/fraud-and-error-in-the-benefit-system-financial-year-2022-to-2023-estimates

But yes, let’s waste resources on trying to ensure we squeeze every last drop out of private school parents (who, incidentally are saving the taxpayer by not using the state system).

Inside Your Ed: Why adding VAT to private school fees is more complicated than it sounds on Apple Podcasts

"If you thought that adding 20% VAT to independent school fees would be a straightforward matter then you may well be having second thoughts by the end of this episode."

Kieran Crowe is a VAT expert and his punchline "I wouldn't want the job of writing this legislation". Closing all the loopholes as Labour say they're going to do, while leaving unharmed the parts of the education landscape Labour say they like (for now), is a Herculean task.

That costs time and money, and enforcement will cost more time and money, while schools will be spending more time and money on forming structures (legally) to avoid parts of the tax. The winners will be tax accountants and lawyers.

‘But at what cost to us the taxpayer?’

oh don’t you worry about that love. The shit this government currently spunk away our taxes on ( Rwanda anyone? ) most of us don’t mind if the next one spends a few quid more making sure this legislation against tax avoidance is water tight.

Who’s to say your school will increase the fees anyway? Not more than the 4/5/6/7+% they chuck on every year as is, anyway…
DF was saying that their fees have gone up more than 20% in the last 3 years - partly to fund a new cricket pavilion.

So we agree there are loopholes and closing them is complicated?

Why "wouldn't you mind" if (1) the government spends significant money (and time, which is money accounted for elsewhere from your taxes and has opportunity cost in terms of more meaningful activity) trying to design this tax and (2) if it fails to make it watertight anyway, so that it raises less money than intended and/or causes unintended harms elsewhere in the economy and (3) if it's a tax that's costly to enforce?

Why "wouldn't you mind"?

£8billion lost through benefit fraud …..Wow!

But of course!

As of last year, £19billion in benefits was left unclaimed by people entitled to claim.

& much "fraud" is actually overpayment by the DWP, who then class it as fraud as they seek to get it back from the claimant.

£35billion lost to tax fraud...... Wow indeed!!!

The question of how to treat children with SEN is huge - VAT is on services not individuals so there is no similar mechanism where 2 people buying the exact same service are subject to different VAT charges (feel free to correct me if I'm wrong on that). Just using whether someone has an EHCP will mean a lot more families pursuing that, and doesn't work in Scotland.

My biggest worry is that it opens up the floodgates for other changes to the VAT system, such as applying 20% for fuel or all foods and currently VAT consumer goods.
Maybe we should pay VAT on all luxury goods including designer children’s clothing.
Most consumer goods are only available to those that can afford them. Should we do away with VAT exemption on the basis that it only affects the very rich in terms of the actual figure they pay.
Buying cheap goods means you pay less VAT.

If Labour see the benefit of what boils down to a “window tax”, the more financial astute may well find the obvious loopholes. Bricking up windows saved people a shed load of money. One thing I have learned over the last 20yrs having been subjected to the Labour governments attempt to “save” money on the NHS dental budget, is that most of the designers of money grabbing legislation are no where near as intelligent as those they try to control. It was very clear that there were significant loopholes in the dental contract that took years to change. Everytime we found one we were told it wasn’t allowed, but the contract was so simple they could not enforce it. The advice was always vague and eventually they came up with expensive complex audits to combat certain types of behaviour.

I fear that the new VAT laws will be very complex since there are so many variations in provision within the private school system. I’m not sure VAT is chargeable if the consumer is resident outside of the UK so international pupils may not have to pay VAT.
It’s possible that this may cause a drop off in international applicants if they close that loophole.
Boarding fees include a both tuition and childcare. Will they be able to create a very distinct category for boarders which will not be classified as childcare which I assume will remain VAT free across all other sectors.

I’m now out of the system so not directly affected but I am concerned about uni fees. If Labour decide to go after higher education it could be catastrophic for many institutes. It would certainly make students seriously consider whether uni is a sensible choice.
It could potentially bring down the whole system. Fewer graduates equals less doctors, dentists, teachers, nurses, paramedics, the list goes on.

I’d like to think that Labour will seriously consider putting this policy o a slow burner to allow them to do joined up thinking and consider the long term implications.

https://www.autoexpress.co.uk/news/363111/used-electric-car-sales-spike-71-ex-company-cars-reach-market-big-numbers

Independent evidence is annoying when it gets in the way of your argument.

Good news there.
Thanks for posting…….yes It must be annoying though🤣

How is a link that helps make the argument on affordability, "Annoying"???

2% of all 2nd car sales are EV's Wow!! with an average sale price of 14k

But i don't expect anyone who has the money to use Private Schools to have any idea of what its like to live rurally, be poor and have no alternative to a cheap run around, which can easily be purchased for less than £1.5k, easily fixable too.

The more i read posts like yours, the more i think the VAT plan is a good policy, go on, you can afford it!!!

https://mediataylor.com/labours-vat-policy-for-private-schools-will-hit-every-homeowner-and-bankrupt-local-councils/?fbclid=IwZXh0bgNhZW0CMTEAAR1CRmKvvW1LjAjs65utCwq6f6KXv6W4Y31qxsQabaXicqm-kH6oyAflJIY_aem_AdylAsTx9rKJomp8SXWDyAqbQIR6SUYyuPOH0JB-GZ-2XSzLISuW7EUFK1JvcAhYoWb5weQbQoNTN0UeUwKpjnri

@twistyizzy Kindly stop clouding the issue with facts!

🤣 sorry!

@Absolutely45

What electric car costs less than £14,000 to make the average cost that? I think that's rubbish. Second hand ones are around for fairly low prices but not many. EV car sales have stalled. Not least due to high prices. It's obvious some people will have to consider if they want to spend on cars or school fees!

It’s good that we now have less polluting cars and people are buying them.
Its good for the planet and peoples health. People with polluting cars will drive them into urban areas and I live off a stretch of road that is one of the most polluted in the country, on the edge of a rural area.

So yes it’s good that people are taxed more if they are polluting the environment and that should also be the case for industries.

As an aside, my kids aren’t in private school
Labours policy will only affect us because it won’t make any money…….happy to wait for them to prove it will.

This particular extract from @twistyizzy post above highlights the cost of education directly, to council tax payers over and above the tax that we already pay on our earnings.

Well no because HE must all be paid for whereas 3-18 schooling can all be free.

Perhaps read @twistyizzy full attachment to fully explain.