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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

To think taxing private schools...

749 replies

maddening · 24/05/2024 19:12

I have no skin in the game, my dc is at a secondary state school. I have no strong views on private schools - although I think state should offer the same level for all dc.

However, looking at the maths I am not convinced the cost and benefits of this proposal works out - apparently vat will bring in 1.3 billion - however if the 554,000 children in private schools had to be schooled in state schools that would cost 4 billion - aibu to think this is not the win that many are led to believe? It is more divisive imo and driven by ideology.

If the private school parents are saving the state 4 billion a year then I don't have an issue with the vat personally.

I think that there could be more requirements placed on private schools in order to retain the vat free status, such as sharing facilities with local state schools and more subsidised places perhaps, or means tested vat relief for parents?

OP posts:
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mathsAIoptions · 03/06/2024 09:41

SabrinaThwaite · 03/06/2024 09:33

Nursery fees have VAT exemption under welfare provision, not education provision.

It’s unlikely that university fees would be treated in the same way as independent schools - there isn't a free alternative to university, and tuition fees are basically dictated by the Government.

But there is free uni in EU. Lib dems want to increase relations again but Labour don't seem to have an opinion - refuse to talk about Brexit at all. I'm going to be encouraging dd to go abroad for Uni. Labour bought in the fees so why would they not add tax now, if we are taxing education? They'd be taxing people who had an "advantage" to get that far, surely? If a precedent is started I don't think anyone can say never.

SabrinaThwaite · 03/06/2024 10:29

We’re not talking about free university provision in other countries here though. And I’m not surprised that Labour are keeping quiet on anything Brexit related in the run up to the election.

They'd be taxing people who had an "advantage" to get that far, surely?

What ‘advantage’ has been achieved? Every child in the UK who has the aptitude and ability to do A levels / Highers can do so for free in state provided education?

mathsAIoptions · 03/06/2024 10:37

SabrinaThwaite · 03/06/2024 10:29

We’re not talking about free university provision in other countries here though. And I’m not surprised that Labour are keeping quiet on anything Brexit related in the run up to the election.

They'd be taxing people who had an "advantage" to get that far, surely?

What ‘advantage’ has been achieved? Every child in the UK who has the aptitude and ability to do A levels / Highers can do so for free in state provided education?

But the kids that don't get that far are usually the disadvantaged.
Or can't afford it.
It follows from the VAT of schools that they'd see university students as the cream of the crop? Part of the tax is because they have an unfair advantage.
Maybe I'm missing something.

SabrinaThwaite · 03/06/2024 10:46

The last Labour government put in measures to make higher education accessible for all - maybe they will create additional barriers to that but I think it’s unlikely.

You can also argue that those degree holders will be going into higher paid jobs and will therefore contribute more to tax take in the long term. Jam tomorrow.

twistyizzy · 03/06/2024 11:00

SabrinaThwaite · 03/06/2024 10:46

The last Labour government put in measures to make higher education accessible for all - maybe they will create additional barriers to that but I think it’s unlikely.

You can also argue that those degree holders will be going into higher paid jobs and will therefore contribute more to tax take in the long term. Jam tomorrow.

Except they brought in tuition fees and scrapped the maintenance grant.

SabrinaThwaite · 03/06/2024 11:28

twistyizzy · 03/06/2024 11:00

Except they brought in tuition fees and scrapped the maintenance grant.

And (as you especially should know) higher education isn't restricted to 3 and 4 year university courses.

worriedaboutthefuturenow · 03/06/2024 17:56

DadBodAlready · 03/06/2024 08:22

So by your logic University also offer a service, are not a charity and so University fees should also incur VAT for the degrees they offer.

yes this is the same effectively

Haveyouseenmylemons · 03/06/2024 18:43

worriedaboutthefuturenow · 02/06/2024 22:21

The latest polls suggest as many as 40% will be forced to state schools, I think it will be around 30% because anyone who has a child about to sit their exams will find a way to pay until their child has finished them. . People keep making the assumption it’s the wealthy that use private but those are the elite schools not the local private schools. In any event it will no way reap the money that Labour expects as most that can will do the fees in advance scheme and avoid paying the vat anyway.

Who did the poll? And of course any survey of parents using PE is going to get biased answers towards leaving because they want to stop it happening!

Morph22010 · 03/06/2024 19:47

SabrinaThwaite · 03/06/2024 09:33

Nursery fees have VAT exemption under welfare provision, not education provision.

It’s unlikely that university fees would be treated in the same way as independent schools - there isn't a free alternative to university, and tuition fees are basically dictated by the Government.

So what is stopping private schools especially boarding schools where kids spend alot of time there outside the normal school day from invoicing part of their fees seperately for welfare services

SabrinaThwaite · 03/06/2024 19:49

Morph22010 · 03/06/2024 19:47

So what is stopping private schools especially boarding schools where kids spend alot of time there outside the normal school day from invoicing part of their fees seperately for welfare services

I’m sure they will.

LittleBearPad · 03/06/2024 22:40

SabrinaThwaite · 03/06/2024 19:49

I’m sure they will.

Only if that’s what the VAT legislation says. The government can write what it wants.

mathsAIoptions · 03/06/2024 22:42

As I've said on the grammar thread - I wish they'd abolish grammars, THAT would make an immediate difference in my area to thousands of kids.

SabrinaThwaite · 04/06/2024 04:42

LittleBearPad · 03/06/2024 22:40

Only if that’s what the VAT legislation says. The government can write what it wants.

True, the Government can write the law as it wishes, although there’s an existing framework for what constitutes welfare and what constitutes education. It will depend on whether the new law allows for the various services (boarding, catering, transport, trips etc) to be disaggregated, or whether they are considered to be connected to the supply of education.

If Labour does hit the entire package with VAT it will be interesting to see if any schools that have obviously split out the services from the education fees in response to the VAT plan are challenged for tax evasion.

LittleBearPad · 04/06/2024 07:05

SabrinaThwaite · 04/06/2024 04:42

True, the Government can write the law as it wishes, although there’s an existing framework for what constitutes welfare and what constitutes education. It will depend on whether the new law allows for the various services (boarding, catering, transport, trips etc) to be disaggregated, or whether they are considered to be connected to the supply of education.

If Labour does hit the entire package with VAT it will be interesting to see if any schools that have obviously split out the services from the education fees in response to the VAT plan are challenged for tax evasion.

But how would they be charged with tax evasion if they charge VAT on all the relevant items. Disaggregating the different elements makes no difference to being able to charge VAT on them.

Morph22010 · 04/06/2024 07:06

LittleBearPad · 04/06/2024 07:05

But how would they be charged with tax evasion if they charge VAT on all the relevant items. Disaggregating the different elements makes no difference to being able to charge VAT on them.

There are vat rules already regarding disaggregation and main supply

Ozanj · 04/06/2024 09:15

SabrinaThwaite · 03/06/2024 10:46

The last Labour government put in measures to make higher education accessible for all - maybe they will create additional barriers to that but I think it’s unlikely.

You can also argue that those degree holders will be going into higher paid jobs and will therefore contribute more to tax take in the long term. Jam tomorrow.

Labour were the ones to create uni fees in a poorly thought out way to ‘get the rich’ but then millions of poor grands were locked into paying back expensive student loans.

Similarly adding vat to private schools is 100% going to impact poor people because eventually other educational sectors may also want the ability to charge vat to students. A lot of private nurseries are examining this closely.

LittleBearPad · 04/06/2024 12:55

Ozanj · 04/06/2024 09:15

Labour were the ones to create uni fees in a poorly thought out way to ‘get the rich’ but then millions of poor grands were locked into paying back expensive student loans.

Similarly adding vat to private schools is 100% going to impact poor people because eventually other educational sectors may also want the ability to charge vat to students. A lot of private nurseries are examining this closely.

Tuition fees are a graduate tax by another name. Students only have to pay them back if they earn enough. Eventually, if this doesn’t happen, they are written off. They aren’t like other debt.

DadBodAlready · 04/06/2024 14:25

LittleBearPad · 04/06/2024 12:55

Tuition fees are a graduate tax by another name. Students only have to pay them back if they earn enough. Eventually, if this doesn’t happen, they are written off. They aren’t like other debt.

Which begs the question 'Why were they given the money to study for a degree in the first place'

Many degree courses today result in an award that isn't worth the paper its written on.

Ozanj · 04/06/2024 15:59

LittleBearPad · 04/06/2024 12:55

Tuition fees are a graduate tax by another name. Students only have to pay them back if they earn enough. Eventually, if this doesn’t happen, they are written off. They aren’t like other debt.

For someone just scraping above the limit. It’s £200-400 (the new loans are high) they could do without

twistyizzy · 04/06/2024 19:09

We always moving towards being a country that taxes education yet exempts gambling.
Crazy.

Another76543 · 04/06/2024 19:41

It’s interesting that she quotes the IFS where it fits her narrative, and yet fails to mention that the IFS Director has also said

“It's not going to raise a very large amount of money. Now one and a half billion isn't nothing but in the context of the overall national budget, in the context of how much we raise from taxes in general, which is more like a trillion, this is a tiny, tiny amount of money. So you might want to do this for reasons of social justice or equity, or because you think it's appropriate to charge VAT but don’t be fooled into thinking this is going to make any real difference to the amount of money available for public services.”

It’s not going to benefit the state sector in the way she’s suggesting.

Another76543 · 04/06/2024 19:42

twistyizzy · 04/06/2024 19:09

We always moving towards being a country that taxes education yet exempts gambling.
Crazy.

We will be taxing education, but not cake, glacé cherries or chocolate body paint……..

worriedaboutthefuturenow · 04/06/2024 19:45

Haveyouseenmylemons · 03/06/2024 18:43

Who did the poll? And of course any survey of parents using PE is going to get biased answers towards leaving because they want to stop it happening!

the polls have been reported in the media. I think it was in one of the nationals a few days ago citing 40%. I dont think people will lie about this, I haven't lied ive told you I will find it because I cant move my child in the middle of his exams but I can tell you that if my child were due to start in September I wouldn't be doing it. The vat will add 6x4k to the fees so £24k extra on top of the school fees, I couldn't sign up for that and I am not poor, but i'm not 'rich' either. A lot of parents will be in the same boat. The elite schools wont care, the hugely wealthy will swallow it, but the local private schools will be the ones that will feel it along with the state schools that will end up trying to take in all the kids that get moved.

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