VAT on private school fees

[user1486984759]

So I’m going to get crucified for this, BUT, let me get this straight:

• We pay 45% tax, thereby funding state schools
• We do not get any benefits, and those that do get priority when it comes to state school admissions
• We scrimp and save from what’s left after paying 45% tax to pay for our kids’ education
• And now the state is going to add 20% to our school fees to fund state schools
• So we pay the most to fund state schools, but when it comes to state school admissions, we are last in line

How is this fair?

It seems that in this country, the best places to be are (1) a non-dom billionaire, or (2) someone who doesn’t pay taxes, gets all the benefits, and gets priority in state school admissions. The hard working PAYE earners are screwed by parties from left, right and center.

RNBrie
Because its a service like any other and they've been completely ripping off the country for years by pretending to be charities. Its a complete disgrace.
@OhCrumbsWhereNow
VAT and Charity status are completely different. 🙄

Not all schools are charities. Removing charitable status is extremely complex and will be tied up in the courts for years (at vast expense to the tax payer).

VAT is prohibited on education under EU law. Now, thanks to Brexit, the government can decide to change that.

However this may mean that we will all be paying VAT on nursery fees, university fees, piano lessons, dance classes, swimming lessons. Interesting to see what happens for specialist SEN schools where a lot of the time it's the local council paying the fees.

Once private schools can charge VAT to their end users, they will all be able to start reclaiming the VAT they have paid on their theatres, science blocks, swimming pools etc (some of the big names will be rubbing their hands - you can go back at least 4 years in terms of reclaims).

In the meantime, the state will need to find places for those children whose parents can no longer afford private schools (bit of a nightmare if schools go under and they have dozens to find places for suddenly).

A lot of women will go part-time or give up work if they're not having to find the money for fees or need more flexibility to provide all the extra curricular that private schools often supply on site. If it applies to nursery fees too, it may well not be worth going back to work at all for many.

Long term it will basically mean a postcode lottery where you pay for a house for a great school rather than pay fees.

OP, there a couple of other threads on this already.

Completely agree @OhCrumbsWhereNow and perfectly written. This is multifaceted and needs some serious thought. We could potentially send ours to private but VAT on top would tip us over. I however wouldn't need to work if that was the case!

Parents who are sending their kids to private schools mostly are already paying more than their fare share

Fair share.

by not sending their own child to the system, they are saving a seat for someone else.

I don't have any massive problems with private schools but please spare us the idea that you're doing us all a favour. You've made a decision based on what you think is best for your child given what you can afford, which is fine. It's not a favour for the rest of us to be grateful for.

This. How do people on benefits get priority on state school admissions?

utterly bizarre statement.

Are they going to add VAT to university fees too?

No one has answered that question because you’ve not given any indication of the estimates on numbers.

Whatever the numbers are, there are the same amount of children who need educating, the same number of textbooks, the same number of teachers, the same number of classrooms and desks. Redistribution is always feasible.

And as a caveat to the above, there may even be less children who need educating where some parents are able to make international decisions and move their children from UK education altogether. Less children, same number of resources, even easier to fix.

Private schools are not charities and shouldn't be treated as such

I don't agree with proposal as it won't generate enough money to fix state education however it will penalise some people who use private schools through scholarships/bursaries.

Not all private schools are equal...Eton or my SEN school, vast difference.

We need to tax wealth rather than what people buy with their money. The wealth gap in this country has grown so significantly and its the middle income people who are being squeezed not the super wealthy.

I am so disappointed Labour has proposed this as it will be divisive and I hope doesn't impact their chances of election.

Who knows, but we would be moving from a situation where education (of all sorts) is exempt to one where it's now deemed acceptable to apply VAT.

Who choses what counts and what doesn't? Piano lessons are fine, but harp seems a bit elitist? Football coaching is fine but not sailing or riding?

My guess would be that it quickly becomes the thin end of the wedge. Which is partly why (as a state school parent) I am so, so against this.

I suspect Labour may back track on it very fast. A lot of on-the-fence Tory voters are climbing off.

The population of the U.K. increased by 11 million over the past decade, so we can estimate that equates to approx 1.5 million additional school age children. Schools still function, and the issues they have are not particularly down to this increase. Next to that, the movement of a small proportion of the 600,000 of private students to the state sector looks very absorbable. Bring it on!

I would be happy to pay more taxes if I had the confidence that the money would actually get spent on schools. I fear it won’t be. It will be used to fund overseas wars and Tory corruption.

And yes, given the fact that UK GDP is same as it was in 2008, while US GDP has doubled and China’s GDP has grown sixfold over the same period, the education system here has failed.

Given the lack of any respectable tech sector, the education system here has failed.

As for VAT on other forms of education, the point is, private school is a luxury, because a free education already exists. University is not a luxury, it is the standard version, not an upgrade.

Perhaps if more wealthy parents were invested in education's success, it wouldn't be failing?

User - there was a long thread about this topic earlier. Generally posters were salivating at the prospect of people like you (and me) being more impoverished by the hike in fees OR imagining some utopia where I will switch to state and then write the state school a fat cheque each term because I no longer pay fees and I am desperate to improve its provision.

I agree with you that taxing school fees is wrong and unfair, but some of your reasons are dubious.

Needless to say, the cheque part won’t happen. If we switch to state then we will pay £££ for a house in the catchment of an outstanding comp and pay ££ on tutors and enrichment for our kids.

Years ago when the National Lottery began one of the first tranches of money they handed out, 1m, went to Eton, it's a charity you know, to build a new swimming pool. Another chunk, 1m, went to Nicholas Soames MP, Churchill's wealthy grandson for grandad papers. Make of that what you will.

I am actually pro having an independent school sector as I dont like the idea of the state controlling education. I like that people can home school, pay for school or go to state school.

But i find some of these arguments so over the top.

The state sector hasnt failed. It is variable and could do with investment but there are areas of success.

The state sector can easily cope with a potentional 7% extra students, who wont all arrive in one go. There is a general demographic change of about 10% less students coming up anyway.

A large school suddenly closing could put tempory bottle pressure in some limited locations at most.

20% on fees might not translate to 20% straight away. Aside from reclaiming VAT, schools can reduce other costs, they can restructure staffing, they can merge, they can make classess just one pupil bigger.

University is not a luxury, it is the standard version, not an upgrade.

It is education that is only available to those willing and/or able to pay for it.

Is it really that much different?

Charitable status is nothing to do with VAT on fees

The exemption on fees is legacy of the EU VAT rules (which we do not, post Brexit have to follow) where there is no taxation on education. Since Brexit, we can set our own VAT rules.

Sugarfree23 · Today 21:14

Op I don't believe in Private schools I think all children should be given the same education

If private schools were banned do you honestly think every state school would be ‘the same’ allowing all children to have the ‘same education’?

By the way, op, there’s already a long thread on the go on this very subject.

This

They don't pay tax though, they have charitable status.

This post makes a lot of sense.

Well yes OP I complete agree with you. Better to leave to another country that value us more and tax us less. What is the point of being here? We get very little back from our taxes.