UK universities in trouble - why not add VAT to tuition?

[80smonster]

UK universities are in trouble, apparently many could close, why not charge VAT on tuition fees (for those that are financially viable)? Bridget Phillipson says they are autonomous institutions and won’t be given a public bail out - they should rely on their own resources:
https://www.theguardian.com/education/article/2024/aug/09/english-universities-face-autumn-tipping-point-as-financial-crisis-looms

YABU - don’t add the VAT
YANBU - add the VAT

It wouldn't be money into state coffers though. It would be more government borrowing on loans that probably wouldn't ever get paid back. What would that achieve, other than a bit of schadenfreude for the private school parents? The VAT would be hypothetical for all but the highest earners, and while I'm happy to tax those individuals more, there are probably better ways of doing it.

I haven't really understood the OPs reasons for putting VAT on tuition fees. As others said its a tax that goes to the government. As regards increasing tuition fees, I think home student numbers (and probably overseas student numbers) would drop further. I have DC at Uni and believe they get very poor value for their tuition fees. The summer break is far too long and what with reading weeks and a long Christmas break, we've wasted 1000's on unused accommodation. Maybe students studying medicine get better value for their money but in my experience it's not good value for money.

That’s not really accurate. The universities will be 20% better off when it comes to anything that is purchased, including any building works they have done. They will actually be loads better off.

I own a nursery and that additional 20% (that state nurseries don’t have to pay, by the way) is absolutely crippling. I would love to be able to claim it back.

School tuition is generally charged a term up front, for the coming term, so you would apply VAT in the same way? Obviously people could pay by direct debit etc. whatever suits your budget?

Not sure it works like that.
Looks as if Goldsmiths, Cardiff and York are on the list of 6 going by this.

thetab.com/uk/2024/07/22/uk-universities-are-crumbling-these-are-the-exact-unis-at-serious-risk-of-closing-375931

Tory stupid policy of restricting visas has cut foreign students and contributed to this. Why on earth would VAT on unis help?

Has anybody got the full list?

Op .. get over yourself..

If you can afford private school fees then you can afford uni ..

Many kids can't.. and rely on the loans to help them through.. AND THEN HAVE TO PAY RENT BECAUSE NO ONE HAS A TRUST FUND SET UP FOR DEPOSIT OR HOUSE PURCHASE. !!

Universities are not private schools, fees are paid yearly, so VAT would be paid once per year.

I feel the key things we have established that the OP does not understand are:

1. What VAT is and where the money levied goes.
2. How university finance and loans work and where the money comes from (the government would be borrowing at RPI to pay VAT to itself which is nuts)
3. How university funding works (no, universities don't recruit foreign students because UK state schools are rubbish, they recruit them because they can charge them much higher fees)

But I admire your confidence in having a strong opinion on the issue despite knowing absolutely nothing about it.

@MojoMoon @Xenia is a renown lawyer. Be careful!

@Frowningprovidence Nursing students spend more time on the wards now according to my nurse friend who has a DD training. She thought her non degree training was superior.

Unis have sports facilities and all sorts of facilities and hard science courses that cost a lot. Because la lot of a nursing degree is outsourced to hospitals it’s not the most expensive degree as unis don’t teach all of it. I quite like my idea of health colleges!

I think it's pretty clear that the only reason why the OP is suggesting this policy is because she is feeling bitter and petulant about having to pay VAT on private school fees, and she is desperate for everyone else to suffer as a result. The only flaw in her plan is that she really hasn't thought it through... the only people who would end up paying more as a result of this policy would be the very highest earners... many of whom will be paying VAT on private school fees for their own DCs on top.

You are really quite painfully ignorant, OP, if you think that failing schools are the reason why universities pursue international students so eagerly. You are totally embarrassing yourself with this thread.

The current fees, amount of
student debt post university, the high interest rates and the fact that most people will never pay it all back is already a concern. Not to mention that parents are having to heavily subsidise their young adults at University.
Adding vat will make things worse. If a qualification can be obtained via the degree apprenticeship route instead, I’d strongly encourage that. It’s competitive but the traditional ‘go to uni’ is less and less attractive every year. It also makes little financial sense (unless you can only achieve your chosen degree via the traditional route, then you have no choice).

I stand by my original point, each university is its own private (heavily regulated) entity

Autonomous does not equal private. HTH. Are private organisations banned from making profits?

I think most of us understand the tax system better than you.

This ^ x 100000

I wouldn't expect truth or analysis from The Tab but maybe they nicked it from somewhere else.

There is only one private university in the UK - University of Buckingham.

In 2020/2021 the estimated beninternational students before graduation was £41.9 billion

Universities as a whole contribute £100 billion a year to the economy.

Graduate uplift on earnings, through the extra paid in tax over a lifetime, more than covers fees.

Fees were supposed to rise with RPI, but have been frozen for 10 years. That's 10 years of effectively cutting funding for Higher Education. When you add in our ridiculous "hostile environmen", Brexit & changes to visas, the war on arts & humanities (the cheaper courses that actually contributed to the more expensive course) and the mismanagement of investment in buildings & land by many institutions then it's not surprising that Universities are cutting staff & courses to "balance their books".

It's a false economy to cut funding for education at any level, but I don't think the burden should fall on students.

@ImpossibleTh1ng i’m not sure the Tab is particularly well known for accuracy. I’d look elsewhere if I were you.

some might have thought for example that Durham might have been considered for. I shudder to think the MN reaction should it merge with Sunderland Uni. Although an upside would be a dramatic mprovement in its widening participation stats.

There is only one private university in the UK - University of Buckingham.

🙄 There's over 50 actually.

I shudder to think the MN reaction should it merge with Sunderland Uni. Although an upside would be a dramatic mprovement in its widening participation stats.

(Cardiff isn't an OfS regulated university - I suspect Medr, the Welsh regulator, would help out if they needed it - not that they do.)

I’m not going to get into a row with you about this because I think we’re essentially on the same side here and just bickering about semantics seems silly. And also I’m far far to too tired….

https://www.walesonline.co.uk/news/education/cardiff-university-faces-cuts-amid-28023417

Well it seems they do.

Actually we are both wrong. The correct answer is 5.

en.wikipedia.org/wiki/Category:Private_universities_in_the_United_Kingdom

@Titchy I was referencing Durham (not Cardiff) in my North East merger😁