How soon might a Labour Government put 20% VAT tax on private school fees?

[jennylamb1]

That really. Given that an election date has been declared for July, how soon might a Labour Government set their first budget?

Lib Dems campaign strategy is solely focussed on taking Tory votes.

They're not daft.

@Blackcats7 · Yesterday 07:01

If the rich had to use state schools then state schools would improve.

This old chestnut yet again. @Blackcats7 do you see private school parents as superior to state school parents? Some sort of ubermensch who could wave a magic wand which state school parents are unable to do?

If so that’s pretty patronising. Also, plenty of rich people educate their children at state schools - there are plenty of posts on here along the lines of “dh and I earn £10 million a year but we send our children to state schools as we are decent, moral people’.
James Dyson wanted to donate £6 million to his old school but the school turned it down.
State schools have all sorts of rules and regulations which, as pp have pointed out on various threads, make it hard for parents to enact changes.

Lots of private schools don’t make a profit and many of those that do are required to invest the money back in the school if they are a charity. They are not distributing dividends to shareholders like David Lloyd. Your analogy doesn’t work.

Honestly calm down. It's just embarrassing reading all this hand wringing.

It's not going to happen immediately. It might not happen at all (I spent vast amounts of time studying labours efforts to change the rules on private education last time they were in power, they were only ever able to find a way to tinker around the edges)

And if it does happen....Well most people with children at private school will have to drop a holiday or go a bit longer before getting their next SUV upgrade (at worst). The few that have overstreched to go there will only be in the same position as the other 95% of the country.

Honestly, we've got Rivers full of shit. An NHS on its knees. A government that partied while the rest of us were locked down. A PM who got richer by £120m last year alone.

And yet all people can do is work themselves into a froth about something that may never happen

Please stop using the argument that the wealthy don't notice tax so what's the use of making them pay it.

Also please differentiate between wealth and PAYE income. I’d be a fan of wealth taxes but they’re really hard to do, which is why we have few of them. See Dan Neidle…

That’s all you can come up with?! You’ve got nothing to respond to their very reasonable arguments?!

I have to pay VAT on my daughter's theatre school fees. It started off as a small business but after it became successful the teacher had to charge VAT. The increased invoices stung a bit but then I remembered she was privileged to be able to go and it was my choice to send her.

You are my queen.

And how is this policy going to resolve any of those issues? It won’t but it will damage some children in the process.

People have every right to be concerned about one of the main policies from a major political party that is going to impact their own DC. And it’s posters like Spaghetti who are winding people up by telling them to not upgrade their SUVs etc. when the people who have the most to lose from this policy are not “rich”, that’s the point. We don’t have a shiny new car - it’s 12 years old and has done 120k miles!

Same here @Dibblydoodahdah but hey I don’t need a car at all, they’re a luxury aren’t they 😂

Your taxes aren't subsidising private education.

You are having to pay less tax to get the same government-paid services (like schools, NHS etc) for each child who is in private education.

Each child educated privately is saving the state the cost of their education, which is an average of £7k per child - although some posters have said that in many places that's as low as £4.5k per child. It's still a saving.

But it's more than that. If the parents weren't paying school fees, they wouldn't be buying £20k of VAT-able goods. Maybe 10k into pension (which loses the government £4k of income tax), 5 K on non-VAT holidays and £5k on 'stuff'. So the government are only losing £500 VAT but they get £6k in extra income tax on top of the £4.5 of not educating the child. So they are around £10k better off for each child in private education - even if they charge VAT. Even if parents don't change their working patterns.

But it gets even worse. In many cases, parents work more hours to fund fees, and also because the wrap around care and extra-curricular within the school day means they can. For the salary point where private school is possible but a stretch, say the Mum earns £100k per year, if she decides to go 3 days per week to do school pickups and run the DC to netball, piano lesson, swimming, guides and stagecoach, the state loses £16k of income tax as well as having to pay £4.5k to educate the child. Each year.

The state gets so much extra money from the parents for each child going private, it's crazy. It's the absolute opposite of a state subsidy!

That's why estimates say that this policy will start actually losing the state money if 10% of children leave private for state - despite getting £4k extra for each child that stays.

@SpaghettiWithaYeti

You say that as if from the position of someone who doesn’t care if it happens or not.

Some people do care and have to make plans, change their lives - the lives of their children in case this does happen.

And yes Labour are shit, yes the policy is delusional nonsense however Labour are so blinded by envy and desperation that they’ve made it one of their key policies.

If it doesn’t happen it’s only because Labour are even shitter than some people thought they were in the first place.

Labour Have already dropped their previously key pledge regarding disabled people’s rights, so it’s not beyond the realms of possibility.

Nevertheless people need to plan for it to happen. Which obviously many people couldn’t care less about, because they hate people wealthier than they are. That’s the British character all over.

When Labour add VAT onto uni fees will people think it’s good idea then? Wah

And that is before the government have to find billions of tax-payers money to reimburse private schools for the last however many years worth of VAT they have spent.

YOUR child may not go to a school with shiny science blocks and theatres and sports halls - but you're about to stump up for Eton's...

It's economically illiterate.

I find it fascinating that on the one hand we are being earnestly told this in the politics of envy. And on the other hand frantically assured that everyone going to private school drives old bangers and is basically on the breadline after school fees are paid

My point is that there a lot of details to iron out before this can happen, if it ever does. The previous labour government never managed it during their time in power. I was there advising private schools on all the various efforts so I am saying this as an informed observer not from a position of envy (and also someone who thinks things like the environment, child poverty, the NHS are all bigger priorities - and no I am not suggesting private school tax will solve these. Far from it. I find the whole excitability about this rather astonishing given all the other issues at stake, that's all)

Given that the first bus leaves my village at 9.00am in the morning we’d be a bit fucked without it…but I guess I can always stop working and contributing to the economy!

And when I say 10% of children moving from state to private, I obviously don't mean only children who are already there. This policy will continue over time.

If in 10 years time, 10,000 children per year whose parents would have pushed themselves for £20k fees decide that £24k - on top of COL and whatever other extra taxes Labour are going to introduce - is just too much of a risk, the state sector will have less money because of this policy.

No they don’t all drive old bangers but some do. It’s the fact that people like you continually make out that all private school parents are rich that is winding people up. When a friend of mine moved her son from a state primary to a private prep (because the state primary was failing him) one of the first things she noticed was that people had nicer cars at the state primary. It suprised her…but when you think about it’s pretty obvious why. The state school was in a pretty affluent village. Many of the parents could afford fees if they dispensed with the nice cars and holidays but they chose not to. That’s there choice but it doesn’t mean that all private school parents can afford both. Some parents can at my DS’ private school. The premier league footballer parent won’t have a problem but the state school teacher parents might. Not all private school parents are in the same income category and even when the top ten per cent income category figures are quoted there is still a huge difference between 10% and 1%.

Yes but like I said, many can. Let's stop painting this as a disaster where there would be a massive exodus to state. There just won't be. (I spent years advising this sector so I do know what I am talking about)

There are so many bigger issues at play. It's just embarrassingly navel gazy to make this all about private education

Navel gazing on a thread about this policy that you came onto, that will really hurt some parents? Ok…

well, labour’s education policy as a whole is terrible and uninspired @SpaghettiWithaYeti , if you want a broader debate.

other than VAT the extra teachers and school counsellors are ok, it’s more what they’re NOT doing.

Health and education are the two main issues to me.

Have you read the Adam Smith report? What out of that do you think is wrong, given that you're so knowledgeable. And I do expect proper facts not just 'I know better'

Not all business supplies are subject to VAT though. That’s the way VAT works - some supplies are subject to it, others not. Education has never been a chargeable supply because VAT is in origin an EU tax, and EU law (which until recently we were subject to) has always exempted education.
‘it’s incorrect to describe this exemption as some kind of tax break or exemption from a tax which is otherwise universal. You e swallowed Labour spin there.

@jennylamb1 @SpaghettiWithaYeti Adding VAT to private school fees is something that can be done very quickly. It doesn't need a change in the law. If you listen to Keir Starmer's interview from 8.10am on this morning's Radio 4 Today Programme you'll hear him confirm it will be done in their first financial statement, asap after being elected.

’one of the first things she noticed was that people had nicer cars at the state primary. It suprised her…’

A friend who is a mortgage advisor told me that the size of a persons TV is often inversely proportionate to their wealth. Possibly the same with cars. Not always. But often.

Some people live within their means and some don’t. Problem is when everything goes up in price, the way it has this last year, almost everyone suffers.

Very easy to be blasé about other people's money.

Although really everyone in the UK will have less money in 10 years time as a result of this.