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.

What is it that you expect to happen?

Bar forcing some children to switch sectors due to the extra tax

Also, nothing is being propped up. I don't understand why people think this. Finding something which isn't taxed and deciding to tax it isn't reversing some injustice. Private schools don't cost the government anything. State school parents are not subsidising private schools any more than they are subsidising private nurseries or universities.

I hope some of the elite private schools can use their charitable funds via the ISC to help fight these claims on behalf of those children in the private sector with SEN who are the target and red meat of this ridiculous Labour ideology policy.

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.
I’m not sure that engagement would lead to the result you think. There are after all far more parents and children with Sen in state schools and in all honesty with far greater needs.

Fee payers lower the state burden by paying tax but not taking the space. It’s such a bizarre reversal on these threads

@timetobegin - not percentage of total wise. The private sector reflects the state school sector in terms of ethnicity and SEN. That is the whole point people have been trying to make!

It is unfair for children with SEN to be caught in the cross fire of two elite sections of society which this boils down to:

1. Rachel Reeves middle class leftie Oxford types VS Boris Johnson Etonian types. That is all this essentially boils down to and the kids on both those camps were and are always going to be fine as their parents were always going to make sure they get a good education, whether top elite state catchment/grammar or private.

Many many children with Sen are “managed out” of prep schools routinely. Those with more high needs disabilities often cannot access private schools at all. So really we are (barring independent special schools) talking about the most able of the sen community from the most affluent families.

@timetobegin - personally, I do not feel comfortable with playing one set of SEN off against another set? Who is the judge of that? The bar cannot be set as high as EHCP due to the admin delays and councils not responding on time/postcode lottery.
You also cannot forget about the mental health crisis in young people going on right now thanks to a combo of high early childhood stress, Covid, screen addictions etc etc. It is so multilayered and complicated and you have failures in the NHS to cope with that. There will for sure be many people who have opted out of state just due to mental health. Do we want these kids all stuck at home? It is bad enough as it is.

In addition, you cannot by human rights laws judge children based on their parents’ wealth status. That is discrimination. You have to judge based on the child’s actual needs.

Private schools DO judge on needs though don’t they?

Glad that you've acknowledged that this policy is intended to prevent use of private schools for ideological reasons, rather than being a traditional tax for the purpose of raising revenue.

That's what breaks the EHRC conventions which prohibit governments from preventing a parent from educating their child in accordance with their beliefs.

A UK law which is brought in purely in order to make that harder is breaking the EHRC laws we helped create.

Looking forward to it being tested in court.

The elite public schools are not playing the special needs card. Their statistics speak for themselves. The ISC is merely highlighting that the private sector is incredibly diverse and caters to many children from a range of backgrounds and families and the types of schools within the private sector differ immensely.

Whilst the senior politicians are aiming for the top 100 private schools this is just 1/6 of the pupil numbers and overall picture.
If only these schools were taxed the policy would not make any significant money at all so we should just all accept that small schools catering to children with SEN are fair game as otherwise the policy won’t stack up at all? It is fundamentally flawed full stop. VAT will not work. If they want some super tax on elite private schools they need to put their thinking hats on and work with the sector. Although again, the top players are actually doing partnership and outreach and I think the truth is the Labour Party do not want the intereference of schools like Eton as they want a one size fits all dogmatic national curriculum for all. As has been the case since the 70s. And we should all be resisting that!

@Timetobegin you can charge VAT at any salary level, it's just that its compulsory to charge VAT if you earn over 90k.

If you aren't registered for VAT you can't claim back VAT, but if you are registered for VAT, then you can claim back VAT.

Eg music tutor who earns less than 90k starts charging VAT. They can then claim back VAT on house extension that incorporates music room where pupils are taught etc etc

“Private schools DO judge on needs though don’t they?“

@timetobegin - err, before the direct grants were abolished lots more kids had access to private schools.

What a government should do is give people a voucher to the tune of state school funding and insist that private schools take that voucher and then just top that up themselves to allow more students in, so it becomes more accessible, not less.

Private schools select their intake so how would that be fair?

Being vat registered is unlikely for most music teachers. However most (all?) fee paying schools are likely to make more than 90K. They are very different offerings.

I don't know how unlikely it is as all the self employed people I know who are VAT registered don't earn over 90k. They are VAT registered for the perks it gives. I'm self employed and not VAT registered because I consider the pros don't outweigh the cons in my profession.

My point was if it becomes law to charge VAT on education then music teachers/tutors/even university might have to charge VAT whether they want to or not if they don't already. As a result they will then be allowed to enjoy the perks of claiming VAT back on all sorts of things.

“Private schools select their intake so how would that be fair?“

@timetobegin - private schools that are selective keep their entry tests. If all pupils got a state school funding voucher private schools would only need to top up and bursaries would reach far more kids. That system would make more sense.

British elite private schools are famous all over the world for their great standards of education, including a broad education with skills that are relevant in the 21st century. As a small country with an ageing population to compete globally and be productive, we need as many youngsters as possible to get the best possible education. The solution is to capitalise on what we already have right here and expand the provision not to attack the sector!

I don’t think anyone would support paying part of the school fees for able children to access private school education. I don’t think it is superior it’s just different. I’m glad we have fee paying options but I would be horrified if a voucher scheme as you describe was actioned.

Why though?
I think that's not a bad idea, we still wouldn't be able to afford private, even with a voucher scheme. But I don't see why it would be a negative, in fact it might mean my kids very big state school, had a reduction in class size, as pupils / students would be more evenly spread, which would surely benefit everyone?
It wouldn't happen though because it would cost the gov. so much more money.

I don't beleive this will go ahead- I think k they'll give every pretence at following the policy, and then will leave it when it's challenged (successfully) and use it as a sorry, but you can see we tried so we didn't lie.

That would be great but I don’t feel so sure

It seems to be the one thing they can do pretty easily, consequences be damned

I don't see why not. The government is all about public-private partnership, and the NHS already outsource many operations and services to for-profit firms.

Given the teacher recruitment crisis (2023 government figures showed that the target for secondary school teachers had been missed by 50% and in physics the recruitment target hit only 17%) they might find it useful to do the same for education.

A voucher covering the cost of each child's basic education - which could be topped up - would encourage parents to invest additional money in their children's education (since doing so doesn't forfeit their entire £7k state educational entitlement) which is an positive externality.

I really don’t think many people advocate for the NHS to outsource provision. I certainly don’t think we want education to go that way either. Free healthcare and free education are what makes our country amazing. Energy should be put into improving that not subsidising private businesses.

@timetobegin

I don’t think anyone would support paying part of the school fees for able children to access private school education.

How about for some not particularly able children? Like children with mild SEN who might benefit from smaller class sizes or quieter groups?

I don’t think it is superior it’s just different.

What's wrong with different? If it's not superior then it shouldn't confer any unearned advantage, so what's your objection?

I’m glad we have fee paying options but I would be horrified if a voucher scheme as you describe was actioned.

You'd be horrified in a lot of countries then. The UK government already allocates funding for each child and that funding follows the child to a specific state school. It's not that uncommon in other countries for funding to follow a child to an accredited private school.

All children should be accommodated in state schools. So no I’m not sure why we would have a separate system for what you describe as “mild sen”.

Theres nothing wrong with “different” I’m not sure why you imagined there was.

I’ve lived in a fair few countries. I’m not sure what your point is. Some systems are great, some not so great, most a mixture. As I said vouchers to spend in public schools wouldn’t be something I would support.