Labour’s private school tax raid ‘likely illegal’

[Zizzagaaaaaww]

Thought some may like to read this article

archive.ph/i1XD3

Sir Keir Starmer’s planned VAT raid on private schools is likely to breach human rights law, The Telegraph can reveal.
The Labour leader risks falling foul of European Court of Human Rights (ECHR) law <a class="break-all" href="https://archive.ph/o/i1XD3/www.telegraph.co.uk/money/tax/labour-private-school-tax-moronic-policy/" rel="nofollow" target="_blank">over his party’s flagship policy, one of Britain’s top constitutional and human rights lawyers has warned.
Lord Pannick, who has taken on some of the UK’s most high-profile court cases, backed legal advice warning that making private schools subject to VAT was likely to breach ECHR law.
He told The Telegraph: “It would be strongly arguable that for a new government to impose VAT on independent schools would breach the right to education.

“That is because all other educational services will remain exempt from VAT and the charging of VAT on independent schools alone is designed to impede private education, and will have that effect.”

The KC and crossbench peer said that the Labour policy risked breaching two articles in the ECHR which protect the right to education.
He referred to legal advice written in response to Labour policies as far back as the early 1980s, when the country’s most senior lawyers warned that plans to end tax exemptions for private schools or abolish the institutions altogether would likely breach international human rights law to which Britain is signed up.
Previous leaders of the party have floated the idea of taxing private schools as part of plans to integrate them into the state sector. Under former party leader Michael Foot, the Labour manifesto of 1983 pledged to “charge VAT on the fees paid to [private] schools”.
The policy to abolish the schools was eventually shot down by senior lawyers, who argued it could be at odds with the ECHR and spoke specifically about the risk of imposing VAT.
While Sir Keir has ruled out abolishing private schools, he plans to force the institutions to pay business rates and 20pc VAT on tuition fees.
In an unearthed legal opinion from 1987, seen by The Telegraph, the late Lord Lester and Lord Pannick, prominent human rights lawyers, concluded a government “could not lawfully prohibit fee-paying, independent education or remove the benefits of charitable status or impose VAT in respect of such education” while a member of the court.
A foreword to the opinion written in 1991 by Lord Scarman, who served as a Law Lord in the precursor to the Supreme Court, said it would “encourage a challenge which could be mounted by taking the argument to the [ECHR]… if ever a government should seek to abolish or discriminate against [private schools]”.
The opinion was jointly written by Lord Lester and Lord Pannick as advice for the Independent Schools Council (ISC) and later published in its journal. Lord Pannick confirmed his belief that the argument still stands today.

Has anyone got a statistic of how many additional rate tax payers and higher rate tax payers are in the state sector?

We are. I certainly do not want some poorer than me private school family with a SEN child contributing £100 to my DCs!

The key thing to remember in all of this that there are only really 100 top elite private schools educating maybe 100,000 pupils and the remaining schools are far more normal so taxing the parents of those hundreds of thousands of kids is utterly unreasonable at best, and in some cases actually quite offensive where they have trauma, SEN etc and have already been failed by the state sector. And that is why it has become so divisive already. And it hasn’t even started properly yet.

The fact that there are 22000 children with Sen who are having to access education privately rather than through the state is in itself unacceptable. Propping up that system and further disadvantaging their families doesn’t seem right. Surely now is the time to address that.

Sometimes a school move IS good for children (even those with Sen). Presenting it as a cliff edge isn’t helpful or kind.

As a side note it does make me uncomfortable how children with Sen are used as point scorers in this discussion. They are not the majority in fee paying schools and should have adequate provision in state schools.

I'm not really sure what you're asking here.

There are 10million school children in the UK.

Around 615 thousand of them (7%) are in private schools.

Around 9.4 million of them (93%) are in state schools.

That means every £1 a private school parent gives must be shared between 13 state school children.

So if each parent paid £3000 VAT, then that would benefit each state school child by just £230.

But many parents have more than one child, so a parent could easily be paying £6000 (for 2 kids in private) for that £230 benefit to each state child.

If I've misunderstood your question, do please explain.

And obviously - as I said - that's if there were no costs or inefficiencies. Which there are: substantial ones

Couldn’t agree more with this.

Making them more elite and exclusive solves exactly nothing.

Make them cheaper with loads of different types and focuses - some academic, some sporty, some arts focused, some focused on small classes and high touch teaching etc. The expensive ones can still do everything but actually many parents just want one or two elements of private school.

One of my children just can’t handle big noisy classrooms, she doesn’t need acres of land, classics or an incredible sports programme etc but there isn’t an option for me to pay for the bit I want - low sensory learning, small class sizes with enough attention to ensure she doesn’t disengage.

@strawberrybubblegum

So if each parent paid £3000 VAT, then that would benefit each state school child by just £230.

I think what I’ve failed to convey is that a £230 benefit to each state school child (even noting that’s before costs which is why I directly quoted you saying that in my previous post) seems very worthwhile to me.

Of course SEN students should have adequate provision in the state sector, but many don’t and that is the reality at the moment. Many students that are not SEN are also being failed by the current system, so it isn’t just SEN students affected although they often bear the brunt of it. If Labour is genuinely interested in improving state schools for all students they will need far more money than the funding projected from this proposal.

Labours own plan is that the money raised will be used to hire 6500 new teachers. There are approximately 26589 schools in the UK (excluding nurseries). Averaged out across all schools, this will provide less than a day and a half of one teacher across the academic year. I would love to know how less than one and a half days of a (likely newly qualified — if they can recruit) teacher at each school is going to meaningfully improve the lives and education of the students in these state schools.

How does forcing children who are settled in their current schools back into schools that weren’t working for them “address the system” when the schools themselves won’t be changed or improved? Addressing the system would be improving the state schools so that SEN families don’t need to pay for private provision, not forcing them out into a system that still won’t meet their needs.

I’m not sure why you’d have to return to a school you left but even if you did presumably some time has passed and you would be in a different part of the school/class/year? As I said this walking off a cliff into horror isn’t helpful or very real for that matter.

I also don’t understand why independent 3-18 schools are being targeted for this tax. The same tax exemption also excludes private academic tuition, music lessons, etc.

Why would these lessons be taxed when taught as part of an independent education, but state school parents paying for these things after school will continue to be tax exempt? This doesn’t seem fair and just targets independent school parents on the basis they’ve chosen to use an independent school.

You really think that's reasonable?

OK.

If 10% of students migrate, and private school parents pay all that money for £0 benefit to the state school kids, will you still think that's a good thing?

People keep mentioning afterschool lessons etc. I think it’s a misunderstanding. On the whole music teachers do not earn enough to be VAT registered. (Over £85,000 I think).

Honestly having read this thread and talked to many parents and carers in a myriad of schools I think it would be extremely beneficial for everyone to have spent some time in state education.

@timetobegin As I said before I’m genuinely happy for you if your time in state schools has left you and your child happy with the support and education provided but this is not the experience for many SEN families.

It can be a huge undertaking for some students to finally find a school setting that works for them and moving them once they finally have a positive experience is not a small matter. Making comments about how families might be pleasantly surprised and it might be a good thing is really dismissive of the needs of many children. I don’t know how you see this as “walking off a cliff into horror.” Join some SEN or home ed communities and you will see that many families feel their local state school is not meeting needs. Obviously this should be changed, but in the meantime if some families are willing and able to pay for a provision that works better why would we intentionally make this even more difficult for them?

Presumably if it's under the same tax exemption then private tuition, music lessons etc will also start charging VAT.

One advantage of being able to charge VAT though is that the schools, private tutors etc will be able to claim back VAT on all sorts of things that they couldn't when not charging VAT like building work etc.

My worry, as I've said previously on MN, is that universities will also be under this tax exemption and they too will start charging VAT.

Yesterday there was yet another news item about a need for uni fees to increase. Adding VAT would be one way to do it.

I'm always assured that this would never happen. But then I never thought the Labour Party would bring in tuition fees or that the Lib Dems would help push through further tuition fees with the Conservatives. So I don't believe it couldn't happen.

@PretendToBeToastWithMe I have experience of the situations you are describing. It isn’t ignorance it’s a difference of opinion. Yes we need to improve provision. Yes change is hard, but honestly it needs doing now, for this generation and the next not just kicking the can down the road.

@timetobegin ”Honestly having read this thread and talked to many parents and carers in a myriad of schools I think it would be extremely beneficial for everyone to have spent some time in state education.”

Where is your factual evidence for the fact that you think most kids in independent school are there all the way from 4-18?

Not born out by my experience. Far from it. It’s anecdotal but many where I live do state primary, then private secondary, then State Sixth Form, for example. Many kids started state and could not cope and so they moved to the private sector. I think it is utterly unforgivable to not get down to understanding how many children are in that camp very precisely!

Yes, as a supposed inconsistency, bringing up music lessons or tutoring makes no sense in terms of VATability.

The broader objection, though, is that the better off will perpetuate educational advantage (even though we’re told by state school enthusiasts that there isn’t any) by using their money for additional lessons and extra-curriculars. That applies to the left-leaning middle class as much as to the stereotypical private school parents.

But the real fraud in all this is the use of money to buy property near good state schools that well-heeled anti-independent parents can afford, while polishing their ideological halos.

@timetobegin - I completely disagree with you as to timing.

This generation of children has already been through Covid. Anyone born since 2020 has experienced the direct effects and arguably it includes birth in 2021 and 2022 when the NHS was still getting back on to its feet for maternity care and 1 year check ups.
Right now we have massive EHCP delays, speech and language delays right through preschool upwards.
Many parents have seen their children’s mental and physical health be neglected and the state has failed them. If such parents have gone private for that reason we really cannot charge them a 20 per cent punitive penalty on top!

I think there are probably 150k kids in the private sector, perhaps 200 k at most who were always going to go private 4-18 all the way through. But we need to know exact numbers. Otherwise this tax really is discriminatory.

I’m sure that data is very easily obtained @Araminta1003 I’m not entirely sure what your point is or what conclusions you would hope to draw from it?

@timetobegin How will this policy, in the absence of additional funding (as there doesn’t seem to be plans for any), lead to improved provision in the state sector and prevent “kicking the can down the road?” I don’t see any clear path for this to actually happen?

My conclusions would be that it is a discriminatory and illegal tax @timetobegin as concerns certain children who are in the private sector by need.

Children who “are in the private sector by need” are being disadvantaged by having to pay fees when they should be able to access state education. Propping that inequality up is not ok.

You don't solve that by putting access to that provision at risk. That makes no sense at all. It's just hurting people who tried to help themselves and what for exactly? So they can experience the alternative? Many have already been there and done that.

“Children who “are in the private sector by need” are being disadvantaged by having to pay fees when they should be able to access state education. Propping that inequality up is not ok.”

These children are actual human beings, not inequality statistics. Why does the Labour Government not engage with their parents and is waiting for it to go to court? Clearly they are cowards for not engaging and just want to blame the Tories.