To have though of a fairer way to fund state education than VAT on private?

[wlakaaf]

State schools are in desperate need of funding.

Money needs raising.

Instead of sticking 20% onto private fees - when those people are already paying 100% of the costs for educating their child, how about this:

Parents of children currently in state schools ought to contribute to their education on a means tested basis. There would be no argument over means, it would be a simple reference to the council tax band of the house you live in. We have bands A-H. I would propose that people in band A-F pay nothing. People in band G pay a fixed charge per year and people in band H pay a higher fixed charge per year.

Keir Starmer has used money to buy a massively expensive house, worth in the region of £2m, in the very tight catchment of a lovely state primary. This is buying privilege, same as buying private education. So why does he get away without paying?

One of the highest council tax rates in England is in a town called Hartlepool and the lowest Westminster.

Are you saying those who live in a 400K 5 bed, in band G, the NE should pay more than those living in a £2m, band C, 2 bedroom flat in St John’s Wood? It’s not as simple as you think.

There are no private schools in Hartlepool so you are taxing those not only without the financial means to access a private education but also the option.

The Athenians gathered taxes by pointing at rich men and saying "we'll have a boat, thank you very much".

The person so selected could avoid boat added tax if they could prove the next person along was worth more.

And the Spartans had a way of dealing with the needs of the young that needn't detain us here.

Imagination, or just do what you've always done.

The rich Romans used to fall over themselves to pay tax as it was seen as prestigious to do so!

I’d prefer tax was simplified.

How else do you propose the income is raised? Increase income tax? Increase NI?
VAT is a huge source of income for the Government and it has to come from somewhere

The UK is - and has always been - a wealthy country, We could start by taxing that.

@Notreat VAT is seen as regressive tax as higher impact on low income families. Maybe, if get rid of VAT and put up income tax, raise same amount but not hit low income families as hard

How about getting rid of income tax, and taxing [luxury] purchases instead ?

You know, like it used to be before 1914.

declining birth rates?
UK was 64m in 2014 - it's predicted to be 70m by 2030

@elenuntis it is predicted there will be 900,000 fewer pupils in schools in 10 years time than there are now (maybe Labour should wait a few years before implementing this policy, then there would be plenty of space for additional pupils in school!). Problem is at the moment the lower numbers are in early years of primary. Actually a bulge in many Secondary schools

All factually correct, but some context:

Uni Fees have not kept track with inflation;

A quick check on two unis on the Charity Commission website revealed income in excess of £50m, and £300m of assets in addition to 9 staff members earning in excess of £150k; I suspect only Eton operates with those levels of finance. Uni may not be operating for profit for the sake of share holders, but they definitely operate as businesses.

Either all education has to have VAT applied or none is - legally I can't see how only one sector can be targeted for VAT and not other - purely political. It will be challenged and no doubt waste £££££ in the process

Given that every other prediction with UK population has been wildly inaccurate I wouldn't trust this one either.

10m more people in the country over a 10 year epoch but 1m less babies...pull the other one!

Ok in order

1. Private schools already pay VAT on the products and services they buy: state schools don’t (they pay upfront but it is claimed back through their LA)

2. What you really mean is that you think parents should pay VAT on educational services. Education (all kinds of education) is one of the areas that has traditionally been exempt from VAT because it is seen as innately positive: democracies generally are in favour of encouraging more education rather than less. Books are also (currently) exempt from VAT for much the same reason. So are virtually all health services and medicines, regardless of who provides them.

3. In many other countries, in recognition that parents who choose privately run schools are effectively paying twice (tax plus fees from taxed income) AND saving the state money by not taking up a state school place, there is either a scheme to directly subsidise private schools or to give parents vouchers to put towards private education. In the UK we do not do this.

4. There is a common misconception that private schools have plenty of money and can absorb a potential 15-20% extra fee hike themselves. In truth, only a tiny, tiny minority of private schools have large endowments, and/or run a significant year to year surplus. Those are the ones constantly opening new theatres and swimming pools (which are nearly always funded by one off capital campaigns, not income). For the vast majority however, their operating budget is on a constant knife edge. For many, just a small handful of fee paying pupils is the difference between staying open and closing. There is no big daddy MAT, county council or government to bail them out if the numbers don’t add up.

5. It is true that private schools could
   make further cuts to their core operating expenses, most of which are staff related. These could include increasing class sizes substantially, cutting SEN provision (which is very expensive and one of the big reasons why many parents choose private schools) and reducing the bursaries they offer to families who can’t afford some
   or all of the fees.

However, consider the consequences if they do this. The state would end up with a large influx of SEN children, who typically cost about twice as much to educate as non-SEN children, and there is little enough state SEN provision as it is. So all SEN children in both sectors would suffer. Nearly all families with bursaries would be heading to the state sector - so that’s another 42,000 extra pupils for the state to educate, with no extra income to pay for it (remember Labour says it will use VAT to fund things like mental health counsellors in schools and raising standards for existing pupils, not for funding new places). And finally, if class sizes increase a lot, many more parents may vote with their feet and leave the sector. International students (currently a big source of income for the UK economy) can and will go elsewhere.

Fair enough you may say - but where does that leave Labour’s grand plans to raise £1.7 billion* to improve standards if there’s hardly anyone left to pay it, on top of finding an additional £500m+ to educate more children in the state sector?

It means general taxation will have to foot the bill…oh but wait - Reeves has said no extra taxes to fund her spending plans. So
that means other public services and investment will have to be cut. Which ones would you like to start with?

*Don’t forget, that £1.7 billion revenue number is based on VAT charged on top of current fees, not on fees reduced by 15-20%…

excellent post....

I'd like to get under the skin of the "Labour Math" of that £1.5bn...

assuming an average capitation* rate of £50k per the fictitious 6500 teachers that it will recruit - this gives £325m for the teachers salaries...

Assuming that they do raise £1.5bn (Dianne Abbott maths of 500000 pupils at £15k ea)....

This leaves £1.17bn...whats the plan for that...does it go into the pot with the other £105bn for education?

Typical Labour, headline grabbing drivel to win popularity with no substance or real plan...

(*Cap rate including PAYE/ERNIC/Pension etc)

Could you explain exactly what you mean by 'taxing that'? What is 'that'?

When you say the UK is a wealthy country, do you mean that the state has many state-owned assets, like parks and swimming pools? We do, but they are generally in use: please say which ones you'd like to sell off for a (once-off) windfall.

Or do you mean that there are many UK residents with large amounts of privately owned assets, which you'd like to charge a wealth tax on? Wealth taxes are often suggested. At what level would you start taxing wealth, and would it include homes and hit middle-income people or would it apply only the very wealthy (say £1million in assets in addition to primary residence). Unfortunately France found that introducing a wealth tax actually cost them rather than raising money, since wealthy people left the country. The very wealthy in London are at least as mobile as the very wealthy in France, so unless you include ordinary people and tax their homes you'd probably find the same thing.

Or do you mean that we have a high standard of living, and many people have a relatively high income? We do already have income tax for this.

Or is it the magic 'tax big business'? If so, do you mean that you want the state to make a land-grab and steal nationalise privately owned business assets? Have you seen what happened when Venezuela did that? Or are you talking about increasing business tax? At what level do you think international businesses will move abroad, losing us jobs and the business taxes we already take?

Live in the catchment of a state school that is desirable and gets good results. Paid a high house price as a result but there are other reasons to live there, it’s good for our lifestyle, jobs and hobbies and we have family connections.
The teachers at the school are mostly good and I am happy enough at the way the children are learning. The parents generally place a high value on education and support the kids to learn at home too. BUT the school building is shocking, the toilets are a disgrace not fit for purpose, the playground is too small for the number of children. New playground equipment is fundraiser by the PTA, all extra music and sports clubs are mostly run by parents, the school ask kids to come with whiteboard markers as they don’t have money for them. I can’t afford to send the kids private but if I could I would in a heartbeat. Provide a decent standard of education proper not overcrowded facilities and sports and music for all, then tell me it’s okay to task parents who use the private sector. We are in Scotland and it’s the so called progressive SNP who are in charge of education (which is in a dire state) so don’t say it’s all the bad tories either. It’s total mismanagement and if you think Starmer will use any money raised to actually improve state education you are a fool.

Sounds like you live in a nice area in a nice house. Perhaps you and the other parents could pay £3k ea per child at the school to top up the school buildings. After all, if you can live in a nice area, you can afford it, or move them to a neighbouring (worse) school for free....

.....of course, I am joking, but this is how Labour are spinning in for private parents...

Trouble is the super rich would just buy their luxury items elsewhere, i.e. Lewis Hamilton buying his private jet via Isle and Man and an offshore trust. Same with other rich people buying their jewelry, watches, etc in other countries. The super rich are hyper-mobile and have the flexibility to live, work and buy stuff in any country they choose.

Meanwhile in the real world where you understand that this isn't possible and would a) result in people having less child b) places filled by the parents having less kids would fall to less affluent parents who couldn't afford this

Thus making the whole system unsustainable beyond about 4 or 5 years...

Massive argument this is an issue and that London in particular attracts the super wealthy who ponce about and deposit far more into the UK economy than the affluent desperate middle classes.

This is part of the issue. Those who see private school as evil and must be stopped perceive everyone who sends their kids to private school as super wealthy. The reality is far from that.

And yes we do want the ultra wealthy to continue to spunk their money in the UK rather than say Switzerland after educating their children there. Kids who school here are more likely to live here (at least part time) throughout their lives.

It is rather gross and not pleasant to talk about but reality...

I think they should ban VAT on school uniform as that in essence is a tax for being tall

The country can’t afford to start dropping VAT.
The only way is up

That's fine but if you have tall kids you start paying VAT on school clothes much earlier than people with small kids. VAT goes on kids clothes from age 14 and shoe size 5. That's an unfair tax on genes.

Well yes two of my kids were very tall for their age so I appreciate where you are coming from. The point I was making was not whether it’s fair or not just rather that the country can’t start dropping taxes at a time when we have less putting in and more taking out.

I am saying it in line with VAT on fee paying education. That's the thing with VAT some still get away with not paying it because they don't come into the category. VAT on musical instruments used in education only those buying have to pay it but is it fair well no but that's how it is.