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.

Well, that’s just bloody rude. There is nothing wrong with my children’s “bog standard” comprehensive school, except the Tory government’s underfunding, thank you very much.

I never said “bog standard”. Wasn’t it Campbell or Mandelson who coined the term?

I haven’t said anything about any particular school. I’ve just said that as a matter of result of policy - and not exclusively Labour’s, the SNP’s or anyone else’s - state schools have generally failed for the last forty or more years.

If bright and eager children would do well anywhere, why go private? If that argument is true, sit back, chuckle and watch private fee payers waste their money.

@Nellodee another not true vote here. I'm a private school parent and I'm quite happy to pay more. But I don't want to do it through VAT on school fees, which undermines the concept of education as a public good, damages lots of schools which are providing an outstanding education (as even KS admits), reduces the money available for bursaries and other charitable activities, and will probably have so many unintended consequences that it won't be very successful anyway. Stick another penny on my income tax instead.

So very well put. 👍

No, you didn’t say “bog standard.” However, I felt the need to make the point that my state educated children did not go to one of the exceptions to the general “failure” that is state education as you see it (ie grammar schools and schools in tiny catchment areas patronised by champagne socialists - another term you didn’t use, but which serves as a useful shorthand to summarise your opinions). Your generalisation was offensive - you were condemning an entire sector. No point doing that if you will then acknowledge multiple exceptions rather than argue that I must be mistaken, my children’s school must have been dreadful, really, because it is a state school of the failing type. You might as well instead apologise for your ridiculous hyperbole.

I see that. But can’t you see the other point of view?

If state education is and was so good - generally, not specifically to one school or another - why would people opt out of state ed or jostle for houses in the right catchment areas?

FWIW, I’m a through-and-through state school product, from a comprehensive via a state primary. But now as a parent I just don’t look at the world as so ‘take it or leave it’. And all my kids have gone state, but selective.

I honestly think that some people are gloating about others not being able to afford private education. If that is your thing, fair enough.

but for those who think it will make it better for state educated children, I honestly don’t think that will happen.

Myth: the extra funding will benefit state educated children. I don’t think that will happen. The cost of the NHS is ever increasing, as is the cost of the public sector in general (anyone looked at the amount of additional civil servants? And the proposals to reduce the working week? The cost of housing migrants is much larger than any projected funding and will increase.

Myth: having more “sharp elbowed” middle class parents will be good for state educated children. That is not going to happen.

1. You will have a big section of the parents who still can afford private to argue massively to those schools that all bursaries should be redirected to existing pupils. And that any grounds state schools are allowed to use for free today should be rented out for a fee to be put to reduced costs.
2. those parents who do chose to state school will spend a huge amount of money on private tuition, enrichment and summer schools. They want their children to excel. They are not interested in getting the bottom half of the class to do better.

Yes of course I can see the other point of view. I am the product of a state grammar school and my children are products of state comprehensives. My dh is the product of a bursary place at a private boarding school. We all got differing experiences of education and were all served well by the education we received. I think there are a great many ways of viewing the same issue and they are all governed more by ideology than by anything else.

Fair and true. 👍

To me it’s a directed attack towards my needs child, we are aiming to put the other two children entering school into state schools. We did have to relocate to find good schools. As I said, one of them we can’t send into state system because of needs. It’s just so disruptive, and at the end labour will end up with nothing to gain.. it’s an aspiration class cultural war being waged by people that don’t have the acumen to be leaders.

Atleast we will save on taxes in one way, Since my parter wont need to work anymore I suspect hmrc won’t be able to get those tax contributions. I am allot more relaxed now tbh. My advise to everyone is find a good local school pull your child out of any private system. We pay enough taxes we should demand the best public education system! I don’t care how much more funding the government has to fork up to build more schools.

If Labour claims they can give us good schools then we will make sure they deliver.. we just spent £5 bn on a war… and £19 billion on a wasted hs2, and the PPE which stood at £12 billion imagine the benefit we would have had if we spent all of that on our education system. Both sides are fooling us with this tax scam… I would vote Lib Dem…

British Non dom billionaires always seem to get away… neither Labour nor conservatives ever go after the biggest tax loop hole in europe. I guess donations are more important to them than getting everyone to their fair share!

Sadly a poor thought out policy pandering to the hard left in the party. In reality this will create a flow of some kids back to state schools from hard working middle class parents for whom the increase will,be the tipping point. However, these are the people who can afford to move closer to the excellent state schools (appreciate not many) which will then knock on to the poorer kids that actually do get an advantage going but probably travel further. That is what we predict at the school I'm on the governing body for.

Unfortunately Labour create policies that look attractive at hitting the rich, but in reality miss the target

I agree

Its a poor policy and kicks a decent sector for very little gain

Other than votes, as Brexit bus did

Very well said. More people need to understand this way of thinking.

The 1p tax rise, ringfenced for education) was a Lib Dem policy, now dropped.

So that would mean a 5% tax rise for basic rate tax payers (just under £200 if you earn around £32k)

The proportion increase would of course be lower for higher rate tax payers, because of the way banding works (around 2.2%) but te amount yielded would be higher.

I think it's quite likely there will be an income tax rise as well as changes to VAT.

(Ringfencing a part of income tax for a single purpose doesn't really work, other than as a manifesto soundbite)

1p on income tax was just a throwaway suggestion. Additional tax on the 100k plus? A new ultra high tax band? One of the problems with VAT on fees is that although it sounds terribly targeted, it's actually economically pretty blunt - because you'd be charging the same actual amount to a be-yachted billionaire as you would to a 'just scraping the fees together' family (and also charging some money to a partial bursary family). If ring-fencing doesn't work, then don't ring-fence - just commit to a big increase in education funding. (I'm not sure Labour have actually technically promised to ring fence VAT on fees, have they? They've just implied it.)

I am sure that I saw that they committed not to raise taxes generally (outside of what they had said previously) so no increase income tax top rate, capital gains tax or impose a wealth tax - in an interview Rachel Reeves gave in August. She said that imposing taxes was not the way to grow the economy and that she didn’t see a way to having more money public services is by taxing their way there.

so I guess you’d need to look at what they said previously they were going to impose (they had said about vat on school fees before but i don’t know others) to know what they plan to do. And to work out what constitutes a tax in these terms

ring fending works fine in other counties like Switzerland. They set how much they want to raise. Charge the tax. Once it’s raised, tax imposed to pay for it is revoked

The Brexit bus suggested an extra £350 million per week could make a significant difference to the NHS. The increase in funding to the NHS since then (excluding covid years) is more than double that. It is not just about funding.

Is that right about extra NHS funding (ex-covid) being double the Brexit slogan?

I don’t doubt you; I’m just a bit taken aback. That’s a bit of a killer stat in the post-Brexit argument.

Income taxes are already too high. Conceptually we need to charge wealth taxes,but they are difficult to administer and costly.
I looked at how some cantons in Switzerland charge wealth taxes (being the leftie cantons, the right wing ones don’t and that is where the very rich move). So for example, Basel canton charges just under 1 per cent wealth tax per year but everyone fills in a hugely complicated tax form like a company and then there are complicated tax deductions. What you would need to do here is make eg everyone with an estimated net worth above let’s say 3 million fill in such a form. So they would have to list their house value (who would ascertain that eg formula applied to cost of purchase plus improvements), all Worldwide savings and investments as at 4 April etc etc and someone in HMRC needs to actually check it. That is what they do in Basel - they literally list every bank account worldwide and every investment etc
That is why they use things like stamp duty here - much easier for HMRC to administer as it is done through the conveyancer. And Paye is also the employers problem and Vat on school fees will be the school’s problem and they can’t really cheat or lie. But for a female single earner on 120k with 2 kids it will be horrendously unfair. I did the maths.

I thought that too. Not sure why it’s not more widely known

I mean I didn’t know either

Yes extra funding. It wouldn’t have been a straight transfer from EU funding and has increased gradually over the years so it doesn’t mean the bus slogan is true. Of course the increase (still an increase) above inflation etc is a lot less. The NHS is a money pit with huge amounts of inefficiency and waste built in, much dating back to the compromises necessary to get doctors and private/charitable hospitals on board at its inception.

But that is the issue, isn’t it? The additional money raised will disappear into the NHS, into funding additional migration, into care homes.

there will be less outreach activities from private schools, less bursaries, less use of private school facilities and the parents of the children now unable to attend private and hence going state will be forcing their way into the high attaining schools, pushing out children from lower socioeconomic groups (buying houses in catchment area, endless tuition).

I think it is a stupid idea. It would be much better to ensure that all private schools lent their sports facilities for free to state schools (many already do this), that they have outreach programmes where state pupils can attend extra classes evenings and Saturdays (again, many do this), increased amount of bursary and that they generally contribute more to society.

@Rochnutty I that just proves that birds of a feather flock together then doesn't it? Obviously one person's sharp elbowed mc parent is another's supportive parent. And one person's relaxed parent is another's can't-be-arsed parent. But we simply didn't want to join the melee.
And all was well.