More than private school fees will be affected by VAT

[MyNameIsFine]

Don't actually know if I'm being unreasonable here, interested to know whether this is true or not. Will the VAT on education also affect holiday clubs and afterschool clubs?

It would be very easy to structure it to only apply to private schools and exclude enrichment activities & after school care.

I'd imagine it will apply to organisations registered per this:

https://www.gov.uk/government/publications/independent-school-registration

"Many families at private school will think that £7k is a lot of money, even if you don’t. Assuming they’re paying 40% income tax, that’s extra gross income of around £12k to find, on top of all their other expenses. £12k earnings might not be a lot to you, but for many families it is."

Well statistically it isn't many cause the overwhelming majority of households with children at private school have around (if not more) 100k after tax.

Also this calculation regarding "extra income" is erroneous, most will find it by changing discretionary spending priorities, slightly.

£7k out of £100k on top of other living expenses and existing school fees is still a lot of money. How would other families feel about being told to find an extra 7% out of their income just to go on more taxes? It’s all relative. It’s laughable that private school parents are often accused of not living in the real world, and then people say things like “oh it’s only an extra £7k a year to find”. I can guarantee you that many private school families view £7k as a lot of money.

" How would other families feel"

Other families pay more as a % of their income in total taxes than those who have 100k left after tax. They get taxed on things like energy, gas, hot food, their coffee on their way to work.

Private schooling is a luxury and it should be taxed as such.

Watching these threads have been embarrassing for private school parents.

@Another76543

Even with that tax raise it still gives your household a post tax/post school fees income of 57k

Pre tax this would have put you in the top 20% of earners in the UK.

It gives a monthly income (after tax and fees) of 4750.

Yeah, they're really struggling.

You’re still missing the point that many families will struggle to magic up £7k a year. You claim that pretty much all private school parents won’t find that a problem and will just pay it. Many families absolutely will struggle to find that money. That’s the reality.

There is no such thing as a “luxury” tax anyway. Even ignoring the fact that a decent education should never be viewed as a luxury, VAT is not a tax on luxuries. There is VAT on gas and electricity bills but not on cake for example.

Well VAT is designed as a luxury tax

Private school is a luxury

Most people who send their children ( and I reckon about 98%) will just find the difference by changing discretionary spending slightly ( as pointed out above).

Now, they might not WANT to, as all the threads which have their special pleading on here show, but the WILL.

Overall, I'd reckon at a rough estimate that the PED for private education is something like 0.3/0.2so a 20% increase in price will cause a fall of about 5/6%.

I'd think that specifically for secondary schools it'll be even lower so -0.15 which results in a fall in demand of about 3%.

Well VAT is designed as a luxury tax

It isnt. It was introduced to replace purchase tax, which was a tax on luxury items. Toilet roll is subject to VAT, but caviar is not. I’m not sure that anyone can argue that toilet roll is more of a luxury than caviar.

It will not even help social justice because elitist schools and rich parents won't be affected. Not one bit.
It will be smaller , cheaper schools at the risk of closing and children with special needs , anxieties and history of bullying having their lives uprooted.

Schools will stop bursaries making private establishments even more elitist.

I don't believe policy will raise money. For many reasons. It won't be enough to even make a difference to state schools and there will be negative effects of over subscribing. I'm not looking forward to bigger classes.

Attacking children and education is just such a stupid and cruel move. It just shows this man is dangerous and I'm worried what's going to be next.

Wish he came up with taxes that he actually had to pay. He's a multimillionaire taxing parents. Disgusting.

@Bibi12

This is why Labour aren't abolishing charitable status ( although it might get harder to maintain).

"It will be smaller , cheaper schools at the risk of closing and children with special needs , anxieties and history of bullying having their lives uprooted."

Appeal to emotion fail. Haven't labour already said that they wouldn't charge this on SEN places?

"Schools will stop bursaries making private establishments even more elitist."

They really won't. All those here saying that their schools will haven't produced any evidence of it, and charitable status will be much harder to justify as you have to show that they MAIN purpose of your business is to be a charity.

"Attacking children and education is just such a stupid and cruel move. It just shows this man is dangerous and I'm worried what's going to be next."

Another appeal to emotion, this is your hill to die on afte children in poverty, children with SEN, children in state schools, children in care, children in all sorts of circumstances have been made significantly worse off over the last 14 years?

Keep trying, no one believes you care.

They will only exempt children with SEN who are under RHCP. This is extremely hard to obtain due to underfunding in social care.

You are Implying, that private education is my hill to die on after other issues but you have nothing to back that up with. Just typical Mumsnet poster launching personal attacks and trying to discredit someone's character rather then use logic.
The thread is about private school VAT. I'm sticking to the subject.

Do you want to talk about state schools? Start a thread! My children are in one I'll be happy to contribute.
You want to talk about child poverty? I had personal experience with it so will definitely have something important to say. Now continuing to help others who are going through similar.

Now go and be nasty to someone else. Even better, have a hot cup of tea and stop taking your frustrations on people you don't even know just because they have different opinion.

I'm done with bullies like you on this site.

@Aladdinzane I've seen you on alot of threads on this topic, forgive me if you've already covered this.. I've been on a lot of these threads as well as I have a lot of skin in the game; we have kids in state currently but moving to private from September as we are very unhappy with the state secondary here.

I do broadly agree with you on the funding, families who pay for private school will have made choices and, yes, are wealthier than most so can (in most cases) find the extra by cutting elsewhere.

I agree it'll be a small amount of families who really cannot, under and circumstances, find the extra. The families I know in private, and us (soon to be) included, are making sacrifices in other areas, but that's holidays and meals out, we're not counting the pennies and eating beans on toast in the cold.

I think the main issue for many is not necessarily finding the physical funds, it's he tipping point where the fees are already expensive and this just pushes it into the territory of not being enough value for families to spend even more. Especially if the state options are adequate near you.

Families will likely reevaluate their choices based on the VAT, but based on perceived value of the service they're paying for, rather than the lack of funds to pay it.

Haven't labour already said that they wouldn't charge this on SEN places?

No, they haven’t. They’ve said that no VAT will apply to those with EHCPs where the place is funded by the LEA. They have said nothing about SEN pupils without an EHCP, and nothing about those with EHCPs where the parents are funding the place.

If you were asking for special cobsideration for students with SEN needs, how would you evidence it? In theory the EHCP process should cover it, but they are really hard to get and the process is too long. Diagnosis alone wouldn't evidence need for private school or, necessarily, that the private school can meet those needs. (Although my two SEN kids were in school during the second covid lockdown and thrived in the smaller class sizes - anecdotally I think anyone with autism would do better in a private school due to this).

I think it’s a very complicated area. The fact is though that some parents have moved their SEN child to private precisely because the state system has failed them, and it’s not fair for them to be hit with a tax penalty on top of fees. Obviously the solution is to make state SEN provision great so that people don’t feel the need to use the private sector, but this policy isn’t going to help with that.

@Another76543

Then you also have the rather spurious SEN diagnosis paid for by parents in order to game the exam systems.

This is precisely why it’s complicated. There are too many variables.

I have massive sympathy for these parents - I also think it's a very fortunate minority of SEN parents*, as so many more just don't have this option - for me, even at the really cheap local private school, it's £9k a year per child, and that's way beyond my means. I'd support some kind of rebate (trying to avoid saying 'exemption' to avoid confusion) where there is evidence of need (probably an NHS diagnosis of some kind).

And actually I wouldn't do VAT anyway. As I think private education is bad for society, like I think the national lottery and smoking are, I'd put a specific tax duty on them (like the duty on fuel, gambling and tobacco). Then you could include SEN in it.

Then legislation would be drafted by people who know about tax and education, consulted pn, refined in the House of Commons and the Lords and implemented. It's a cleaner, more transparent way of achieving policy aims and would stop people on mumsnet arguing about VAT when they don't understand it.

I'd then have a policy which created state schools suitable for academically able children with autism and ADHD, which would be much cheaper than current special schools while meeting needs. And I'd train primary teachers on spotting ADHD and autism in girls and meeting their needs. And voila, I have solved all society's problems! Go me!

Please note, this is an unfunded policy...

*'fortunate SEN parent' is arguably a bad choice of words. Hopefully people will know what I mean. Also, neurodivergent children can be amazing, but parenting them can be challenging. Also I know SEN is much broader than autism and ADHD but that's my experience so that's what I think about.

I absolutely agree. The fact that many children can only access a suitable education if they’re fortunate enough to have parents who can afford private fees is a disgrace. The state system needs an overhaul. This policy is not the answer to that though.

Is the problem only funding, though? Labour candidate was saying that the money was tor provide breakfast for pupils. Not more teachers. Not raising standards. Not SEN Kids are coming to school without having had any breakfast. I really don't want to judge people who are struggling with cost of living, mental health and probably have family problems, because I know I wouldn't cope well in their situation either, but if children's basic needs aren't being met by their families, that's a bottomless pit of money that's never going to be filled. I lived in a country with much greater poverty levels. Kids didn't have toys or pocket money (there were no toy shops), but they had breakfast before they went to school. They did their homework as well. The problems in our schools aren't just to do with money, and money isn't going to fix it.

100% correct. Within the UK, a couple of generations ago, when families were relatively poorer than now, children went to school fed, clean, and behaved in class. They aspired to something better. The problems now lie far deeper than a simple question of throwing money at it.

The thing is, nobody wants to say it, because it sounds so judgemental. But this is a big reason people go private if they can afford it. In theory they want their children to go to the local school, but in practice, they find the child doesn't get any attention from the teacher because they don't have the needs of the children who haven't had breakfast - who are the priority, right? They want their child to actually get an education, so they go private. The state is essentially parenting a large proportion of kids and if you want an actual education, you have to pay for it.

Most ordinary people are not up in arms about it because we see private school as a luxury for the privileged few. Luxuries should be subject to vat.
After school and holiday clubs are a necessity and will not be taxed.
Stop trying to scaremonger

Except VAT isnt about luxuries otherwise toilet roll wouldn't be taxed.

Toilet roll was a luxury when I was a kid