To ask if anyone is clued up on the challenge this week to VAT on school fees?

[feesss]

we went to look round a school this morning and we obviously asked about VAT and the lady showing us round said there has been a challenge this week so it may not happen? Is anyone aware of this? I can’t see much online about it?

Doubt whether it will work.

If you are considering school fees and the extra VAT, it might also be worth considering how much extra you are going to be taxed in the forthcoming budget as that may well take a sizeable chunk out of your earnings, making school fees further unaffordable. I would be waiting until after the budget before making a decision if affordability was an issue.

Frankly, if they can spin you this sort of line I'd be looking for another school.

OP, that it will happen is not really in doubt. However, the chances of it happening in January are almost nil.

The legislation isn't in place yet and schools have not yet been able to register for VAT. Spring term invoices need to be raised in about 7 weeks.

You need to assume VAT will be payable, but probably from September'25. This govt talk a good headline but clearly had not considered the logistics of such a mid year change.

Sure it’s ‘State shall respect the right of parents to ensure such education and teaching in conformity with their own religious and philosophical convictions’. The state can’t hinder education choices in a targeted manner, for example targeting a group of people they don’t like (and don’t vote for them) who have opted out of state education. If the proposal was to tax all education including nurseries and universities then possibly it would get through, but as it stands .. no chance.

Labour will (prob already has) receive legal advice to drop it, it will be delayed from January under some spurious excuse and fully (quietly as they can manage) dropped by April.

What precedents from the A2P1 jurisprudence of the,ECtHR make you think they will find taxation, even a targeted form of taxation, amounts to unlawful breach of human rights?

The position of the European and to a much greater extent our domestic courts is always to treat tax as a matter of domestic policy incapable of amounting to a violation. If you can find any domestic or ECtHR precedents where tax law is find in violation of convention rights please do cite them

Otherwise no matter how strong your policy argument might be it's going nowhere in court. And I think the government lawyers know that

I know of no precedent other than the last time labour attempted this, where it was dropped under legal advice. Of course the U.K. was part of the EU then so it was more straight forward.

We’ll have to agree to disagree for now, let’s catch up in January and then again in April and see how things are looking.

Surely the fact that such schools charge fees at all is a far bigger barrier than the application of tax to those fees?

But that has nothing to do with A2P1. It was to do with EU Vat rules which are no longer applicable.

This is part of the Brexit dividend. We are a sovereign nation now and have what items are and are not VAT exempt. It's a win for users of tampons and a loss for users of private education.

But it has nothing to do with the ECHR and the fact you think it's relevant tells me you know nothing about the ECHR.

Ok, simmer. It quite obviously does have something to do with the ECHR, it’s written in black and white as a basic freedom. This is a silly typical pointless ‘random internet I’m an expert argument’ so as I said, let’s revisit in January and again in April and see who is correct.

If you are looking for something to keep you busy, you could research:
-How many of the 46 signatories of ECHR tax education.
-How many of the 46 signatories subsidise private education.

Have a little think about what you find out. See you in January.

Wrong. It is a test case so noone can say with any certainty whether it will succeed or fail. The law firm hired certainly believe it will succeed.
Also there isn't just 1 legal challenge, there are now 3

Yes, of course it is. But that’s not the state deliberately using tax to limit education choice. Lots of PS are non profit and only charge enough to cover the cost , you won’t hear about these from Labour.

I do agree with you about the fees, if the state part subsidised PS through tax deductible benefits or giving pupils their allotted cost of a state school then we would see a much wider education choice for everyone and less of burden on state schools. It’s what the majority of our European neighbours/competitors do. That won’t happen while people are being spite baited into a race to the bottom by backward identity politics.

There is now also the suggestion of age discrimination as it specifies ages.
It is dragging nurseries and universities into the discussion due to the rushed nature of the legislation.
No impact assessment has been published, they have spent longer researching the sugar tax than this!

That's totally irrelevant to the scope of the ECHR. The margin of appreciation to the right to education is huge. Quite obviously to anyone who knows anything about HR law no international court or domestic court is going question the right of a democratically elected government to set their own tax policy.

It's just not a human rights issue. It's breathtaking that anyone could imagine it is.

When Labour introduced tuition fees for universities nobody argued that violated a right to education. The fact preschool provision has been largely private until the last decade or so can be a practical problem but no one sane has ever argued it's a human rights issue. There are many CoE states that still didn't fund universal education to 18 or even 16. As I say the margin of appreciation is huge. There's literally zero chance the fact some families may not be able to choose their preferred school but can still access free education for their kids will ever be an hr violation.

The lady is bullshitting you to try to get you to use her business. Just as a used car salesperson will gloss over the shit bits of a dodgy car to get you to commit…

Yes, it’s all ridiculous. I don’t believe it was ever seriously meant to be implemented and was just a bit of election red meat fodder to get the spite inclined motivated enough to actually go to the polling office. The guidance on after school clubs not attracting VAT if they’re not educational is just mad. Seriously, a Government that would rather have kids sat in a room doing nothing than be educated!?! Madness.

Not only will you likely pay VAT on fees but the business that you pay to educate your child will almost certainly put your fees up year on year by 5-15% and you’ll have no choice but to pay it. Not to mention all the extras like overpriced uniform, trips, music lesson, sports lessons,
exam fees, transport…

Well, let’s see.

But:

1. The Human Rights Act cannot override primary legislation – all a successful challenge would do is provide a “declaration of incompatibility” which simply asks Parliament to think again. Parliament is sovereign so they can decline to do so with no consequences.
2. No ECHR challenge has ever resulted in tax legislation being held to be incompatible with Convention rights. This is true even in the case of retroactive legislation (which is widely considered to be the most unfair as it’s effectively a change in law after the event). Example Court of Appeal decision here: https://www.bailii.org/ew/cases/EWCA/Civ/2020/1744.html
3. Private schools already pay tax; they pay VAT on purchases and employer’s national insurance contributions. Many also pay business rates.
4. Age discrimination arguments haven’t stopped National Insurance only applying to people under retirement age. Or pensions only being available to those over 65. Or governments increasing the state pension age. Because national governments elected by their citizens, are allowed to decide how to raise tax revenue and how to spend it.

This thread was written by a widely respected tax lawyer and is a well referenced explanation of why this challenge is very unlikely to succeed. https://x.com/danneidle/status/1806732361838592115?s=61&t=Jj8VuAY2BOaQcdyUju3xeA

1. Yes the Government can ignore ECHR rulings with no formal consequences. Do you think that is likely? Do you think the Government would risk the embarrassment of that ever even happening if they are advised it’s likely. Here is a link to Starmer gushing about the ECHR:
   https://www.politico.eu/article/britain-keir-starmer-never-leave-european-convention-human-rights-political-community-summit/

2. Has any of the ECHR signatories attempted to remove educational choice via discriminatory taxation before?

3. Correct. Nobody pays VAT on the provison of education as a service though, it is deemed for the common good and therefore charitable.

4. Yes. Is there an example of VAT that only applies to certain age groups you’d care to share?

Lord Pannick on why private school education tax is likely illegally
https://www.telegraph.co.uk/money/tax/labour-private-school-tax-raid-likely-illegal/

Sounds like you don’t know what private schools charge for. Trips, music lessons, transport are all optional. The ’extras’ are touted often on MN as being practically on a par with the fees. The extras are rarely more than a couple of hundred pounds a year.

1. Yes the Government can ignore ECHR rulings with no formal consequences. Do you think that is likely? Do you think the Government would risk the embarrassment of that ever even happening if they are advised it’s likely. Here is a link to Starmer gushing about the ECHR:

www.politico.eu/article/britain-keir-starmer-never-leave-european-convention-human-

How many times! It’s going to be very easy. We’re not in the EU anymore. We can do whatever we like.

I think you’re right that it’s not going to raise money and it’s just a cheap vote winner though, but it’s 100% coming in. I think it will be pushed back to next summer.

The IFS report bases the revenue expectation on the idea that parents who are forced from the private sector into the public will spend the money they save on education on other vatable items. So they get their 20% either way.
There’s something quite perverse about a Government pushing behaviour change from paying for your children’s education to buying a new Mercedes,

You’ve said that twice.

IF the ECHR rules that VAT on school fees is incompatible with the Convention, the government will have a choice between ignoring it (like they continue to ignore the ECHR ruling that denying prisoners the vote is incompatible with the Convention - Hirst v United Kingdom (No 2)) and going back on a manifesto commitment. That will be up to the government but I can’t see them going back on such a high profile manifesto commitment personally.

BUT the ECHR are very very unlikely to rule that. I’ve cited two cases explaining why. There are more, such as a German case on church tax, which was argued to be contrary to the Convention. The ECHR were fine with that too.

Please do show me where I’m wrong on the law. I would be very interested to read any decisions where the ECHR has expressed willingness to strike down domestic tax rules. I’m not aware of any.

Or chose a private school that is a charity and educational trust, as I have, and you may see fees raised in line with inflation, and extras that cost no more than scouts or a local karate class.

There are as many different types of private school as there are pebbles on a beach, having evolved over the last 400 years. Most are not profit making and work hard to limit their fees as much as possible.