To not see how the gov will make any money from taxing private schools?

[AngryHedgehog]

All the other threads seem to have descended into bunfighting over the ethics of the policy, yet I'm not really understanding how this stands to benefit the government as surely they'll be footing the bill for all the kids that move to state schools?

As a disclaimer, I don't have kids and wouldn't be able to afford to privately educate them even if I did, despite earning a half decent salary.

I'm reading that it costs around £7k per pupil per term, so it would take the VAT from around four families to fund each additional child moving to state education.

Given that this may be 4/10 kids in private education moving to state schooling, I don't see how this doesn't create a net loss as there will only be 50% more kids left in private education and there needs to be multiple times that for the VAT increase to foot the bill.

Surely I'm missing something here?

Also add in that schools don't currently reclaim VAT on the items they purchase which if VAT were applied to fees they would be able to. This will reduce the amount the government receives. For me I feels like a poorly thought through vote grabbing policy. But then all the policy's so far seem similar from everyone.

The theory is that the cost of the tiny no. of children who move to state education, will be more than offset by 20% on the vast majority who keep their dcs in private school & just pay up.

What the Labour party hasn't realised - or is ignoring because it suits them - is that large numbers of middle class private school parents are already stretched to the limit and an extra 20% will be unaffordable.

I'm pretty sure Labour have their sums wrong because most of my son's class are moving to state for 6th form because of the cost. Only 5 out of 23 are staying.

Yanbu - if anything, it will be a net cost.

There are about 100,000 children with SEN in private schools, who don't have ehcps. Their parents funding these places are saving the state an absolute fortune.

Tack onto this that all main parties are claiming to not be rising taxes - income, national insurance etc, then how do the proponents of this VAT policy suppose that state education will be better funded? Funded from fresh air?

If taxes aren't going up, then cuts must be made.

And you can bet it won't be private schools facing those cuts.

It clearly isn’t a fiscal policy, it’s a headline grabbing one.

The maths doesn’t seem to work.

Most of them will stay in the private sector. Only a tiny minority will move to state. The people who are comfortable can afford that tiny increase.

I agree. Saying they will move to the state sector will not be the case in reality for many.

It’s the usual labour bs

No some of us can't! From 6K to 7.2K per term pushes it out of comfort. We don't have that extra 1.2K down the side of the sofa

It’s the Brexit bus of this year’s election.

Given that this may be 4/10 kids in private education moving to state schooling

This stat is from a report carried out by a financial adviser to private schools, with no published methodology. I would not trust the figures.

Most already in private schools will stay but it will probably have a significant impact on how many go into the private sector when choosing a new school. Also some private schools will fail as a result at which point the state sector will have to find places for a large proportion of pupils from the failed school.

It will be interesting to see how it pans out. Will fee-paying schools be in a position to reduce fees to absorb some of the increase, at least in the first instance. More likely than parents pulling children out (though some will) is deciding not to send younger siblings to private school, and prospective private school parents deciding to send their children to state school in the first place.

My Ds is at Private school but we can and will absorb any increase, would rather not but it is what it is and the policy won't make me vote Conservative and I am not complaining about it.
BUT I really hope that the policy actually helps State schools directly and any money raised is ring fenced for this. I am not an economist but a brief look at the figures suggests that very little if anything will be raised and that is my principle reason for being opposed to it.
It will not affect the really rich so Private education will become even more elite, not all Private schools are Eton, DS's friends parents are Teachers, Accountants, Doctors, Police Officers, Social Workers rather than Bankers or similar and while I know we are lucky to be able to have an alternative option to the local very bad State provision we are not from priviledged backgrounds and we have plenty of friends with far more money than us who aren't paying for Private School.

I disagree most will stay in the private sector as independent schools are already warning of increases from September, and l know several parents at my DD's school (she leaves this year luckily) who have registered at local state schools.
Even if 5% move to the state sector (l am sure there will be a higher percentage)there will not be any gains, and many state schools will struggle to accommodate more children.

It is a stupid, ill thought out idea that will cause a ton of long term issues affecting children negatively.

Yeah as a policy it’s not going to raise much money tbh. It’s a bit pointless but I guess it’s a bit of signalling and affects a minority of people so Labour thinks of it as an easy win. Probably see more competition for grammar school places and people looking to move near good state schools.

The fact that some SEN kids may be pushed into mainstream when they struggle there concerns me.

I also don’t think they realise it’s not only private school parents who are concerned about this. I’m older, all my kids state educated, adults now, but a family member is employed in a small private school. We are all very worried about their job and cut backs if this policy is rolled out, there have been many discussions at the school about how to handle this, and there seems to be an expectation that some of the increase will be absorbed by the school via cutbacks to try to avoid losing too many students. For that reason I can’t vote for them. Don’t want to vote for the other lot either. It’s a total dilemma.

Yes, over 5 years it's likely to be a net cost.

But also, many parents pay more than 100% of their child's cost. The extra funds pay for bursaries to help less well-off kids.

Imposing VAT treats the schools as businesses, relieving them of their charitable obligations. So they'll no longer have to provide bursaries to the parents of the less wealthy kids who will fall back on the state. Many private schools will simply try to plug any gaps by enrolling more overseas students.

Why do so many overseas parents want to educate their kids in this country? Because it's one of the things we excel at. So why are Labour attacking it, if not for reasons of good old-fashioned class war?

They’re really not saving the state a fortune. Very few will actually leave, most are apparantly grammar stealers🙄 and SEN without an EHCP can be just needing extra time in exams. State pupils with SEN don’t have a fortune spent on them.

It really does feel punitive. Looks good to those who have a gripe about the system but will it actually do any good?

It's so that Labour can be seen to be "taxing the rich" to appeal to their old voter base whilst quietly sharing Tory policy on benefits and promising to use the private sector to "help out" the NHS.

I agree it will cost more than it makes.

If schools add on a full 20% to feed they are racketeering.

If schools charge VAT on their ‘supplies’ (I.e an education ) then they can reclaim the VAT they pay on everything they buy from other suppliers. I.e their net costs will go down by 20% on every VATable product or service they pay for. Taking down the net cost of their service.

However I am not in favour of taxing private education. As far as I can see most services for education are tax exempt and love it or hate it, private education is an educational service. Just like Uni (fees tax exempt) or private music lessons. In fact more so because private schools cover the years when education is compulsory, unlike Uni or extra curricular services.

Disclaimer: Not a tax expert / not a private school user or supporter

I couldn’t have afford private for my kids. But I know several people whose kids are in private school and 20% increase would take them from ‘affordable if we are careful with money on everything else’ to ‘can’t afford it at all’

They won’t and can’t pay it. It’s really not rare for people in these situations.

I don't understand why no-one is talking about the other knock on effects. If people absorb the increase then unless they are the super rich it means they will have to tighten their belts in other areas. Yes - having a cleaner is a luxury, giving to charity is a luxury but to look at it another way those are the people / organisations who will pay for this. You can't spend it twice.

I've no skin in this game, but I feel it's a terrible policy and will back fire massively mostly on the state schools who are already struggling and have to take in more children. How does this help anyone?
It won't make any difference to those at the really elite schools as those parents will be able to afford it. It'll be the smaller private schools that will be affected and their staff too no doubt who may end up redundant.

Sussurations · Today 08:52
It will be interesting to see how it pans out.

Yes. It will be interesting to revisit these threads in 18 months or so. Often when lots of predictions are made about the consequences of a future event, it’s the one thing that no one predicted that happens.