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Labour’s private school tax raid ‘likely illegal’

1000 replies

Zizzagaaaaaww · 28/06/2024 17:04

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.

OP posts:
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crumblingschools · 29/06/2024 10:25

There is a statutory limit to how long an application for EHCP should take, 20 weeks. Currently applications are taking an average of 68 weeks in my area, and then many of them are rejected and go to appeal. Even if you get one approved funding isn’t always accurate. Wouldn’t it have been good if Labour had said they would have tackled this issue and the general lack of SEN funding, instead of some headline winning policy which won’t help anyone

Teentaxidriver · 29/06/2024 10:26

Perplexed20 · 29/06/2024 01:26

The Telegraph is a comic.

Yeah right, I think the dummy might be the one the saying this. Go back to your Beano and let the grown ups talk.

Charlie2121 · 29/06/2024 10:30

TheFallenMadonna · 29/06/2024 10:18

If it usually takes years to process, why would it need to happen quicker now? Wouldn't those 100 000 just take their place in the queue?

You can’t impose a tax where applicability is dependent on state assessment and then not offer a timely state assessment. That would breach discrimination laws.

Charlie2121 · 29/06/2024 10:32

TheFallenMadonna · 29/06/2024 10:19

Most children with SEND in mainstream state schools don't have an EHCP either.

How is that relevant? They don’t get taxed extra if they don’t have one.

Philandbill · 29/06/2024 10:33

Charlie2121 · 29/06/2024 09:56

That is incorrect. The majority of people using private schools pay a disproportionate amount of tax. Our household paid over 100k income tax last year. The issue is one of fairness. Why should I pay even more tax when households on similar salaries who use state schools will then pay less than me. If money is needed for state education it should be raised through income tax.

Edited

You could always send your child to a state school too....

ArseInTheCoOpWindow · 29/06/2024 10:34

RoseAndRose · 29/06/2024 09:48

It is relevant, because of the need for tax harmonisation across the board.

Outside the EU, then differing sales tax doesn't matter.

But for free movement of goods and services, you need harmonisation across all goods and services.

And this policy represents a step away from that.

But not VAT on private schools. They aren’t international goods. And if they are foreign people would also have to pay. They don’t travel through customs.

Its customs and trade where closer co operation is important! Not vat on schools.

Another76543 · 29/06/2024 10:36

ArseInTheCoOpWindow · 29/06/2024 10:34

But not VAT on private schools. They aren’t international goods. And if they are foreign people would also have to pay. They don’t travel through customs.

Its customs and trade where closer co operation is important! Not vat on schools.

You’re missing the point that Starmer’s comments stretch beyond trade.

“Most of the conflict with the UK being outside of the [EU] arises in so far as the UK wants to diverge and do different things to the rest of our EU partners. Obviously the more we share values, the more we share a future together, the less the conflict”

SeriaMau · 29/06/2024 10:38

Yawn.

Zoda8 · 29/06/2024 10:39

If Labour believe in what they are doing, they should be happy to defend their policy in the courts if needs be. When the laws about charity were first framed, schools tended to be free to pupils, and widen educational opportunities to those who couldn’t afford private tutors. A blanket rule was applied that all education is charity. The current situation, where Eton is the school for princes and the buzzword for many (not all) private schools is ‘added value’, it is difficult even for supporters of Eton to argue that subsidising Prince Harry’s school fees is a type of charity. However, if this Labour government care at all for the schools and parents caught out by this, they should consider the tapering in of VAT over a few years so schools and parents can make adjustments/alternative plans rather than enter an unseemly last minute scramble for places after common transfer day.

EHCPerhaps · 29/06/2024 10:39

I’m a Labour voter because I want the NHS and public services to continue to exist free at the point of use, AND under Labour to be funded properly, attracting sufficient prioritisation that they raise standards at least back to the level of quality that New Labour made happen.

And I hate this policy. It’s petty and doesn’t achieve its own stated aims of raising loads of money to fund teachers and causes huge division and distracts from the bigger issues we need to tackle.

Yes I can well believe that populist Labour of today accepted this argument over 4 decades ago and have now forgotten it. That happens. The Tories have probably had dire warnings against such patiently self-injurious ideas as leaving the EU. Memories aren’t always long in politics. The fucking irony is that the Tory voting families who are saying Great! It’s against our human rights to raise VAT on school fees, don’t seem to also acknowledge their own political hypocrisy. It’s pretty clearthat part of the Brexit-loving, country-ruining-and-elite-enriching hard right Tory agenda, towards which your party is lurching, would be TO LEAVE THE ECHR.

This I am convinced is a long term aim because the Tory Party thinks it will help in it’s desperate attempts to deter illegal asylum (without providing an accessible legal route) and to deny UK workers’ claims that would make the workplace fairer for them. Thereby saving money for bosses.

Suddenly for Tory voters with kids in private schools, it feels pretty great to have all that awful apparently-unnecessary legal protection against exploitation around you, doesn’t it? Especially when it could rescue you from an ill judged populist policy that singles you out unfairly, personally, financially, doesn’t it? See, it’s exactly like that for all the other people too, who’d like to hold on their working rights or maternity rights , Or environmental or educational rights..

twistyizzy · 29/06/2024 10:41

EHCPerhaps · 29/06/2024 10:39

I’m a Labour voter because I want the NHS and public services to continue to exist free at the point of use, AND under Labour to be funded properly, attracting sufficient prioritisation that they raise standards at least back to the level of quality that New Labour made happen.

And I hate this policy. It’s petty and doesn’t achieve its own stated aims of raising loads of money to fund teachers and causes huge division and distracts from the bigger issues we need to tackle.

Yes I can well believe that populist Labour of today accepted this argument over 4 decades ago and have now forgotten it. That happens. The Tories have probably had dire warnings against such patiently self-injurious ideas as leaving the EU. Memories aren’t always long in politics. The fucking irony is that the Tory voting families who are saying Great! It’s against our human rights to raise VAT on school fees, don’t seem to also acknowledge their own political hypocrisy. It’s pretty clearthat part of the Brexit-loving, country-ruining-and-elite-enriching hard right Tory agenda, towards which your party is lurching, would be TO LEAVE THE ECHR.

This I am convinced is a long term aim because the Tory Party thinks it will help in it’s desperate attempts to deter illegal asylum (without providing an accessible legal route) and to deny UK workers’ claims that would make the workplace fairer for them. Thereby saving money for bosses.

Suddenly for Tory voters with kids in private schools, it feels pretty great to have all that awful apparently-unnecessary legal protection against exploitation around you, doesn’t it? Especially when it could rescue you from an ill judged populist policy that singles you out unfairly, personally, financially, doesn’t it? See, it’s exactly like that for all the other people too, who’d like to hold on their working rights or maternity rights , Or environmental or educational rights..

Yet again, the lazy assumption that anyone who opposes this policy is a Tory!
No-one is saying that state education doesn't need funding, we are saying that a policy that will likely bring in £0 isn't the vehicle to do it in.

Scruffily · 29/06/2024 10:42

Looking forward to Tories relying on the EHCR which they want to abolish in order to challenge this one.

Another76543 · 29/06/2024 10:45

Scruffily · 29/06/2024 10:42

Looking forward to Tories relying on the EHCR which they want to abolish in order to challenge this one.

It won’t be the Tories bringing any legal cases though. It’s likely to be the schools/ISC.

Equanimitas · 29/06/2024 10:45

blahdee · 29/06/2024 07:22

Indeed, my understanding is they have refused to engage directly with the private sector too, including private schools with specialism in Sen. Unfortunately, it feels more about ideology over pragmatism.

It would be interesting to see how lawful this is in terms of specifying only VAT on 5-18 year olds education and not nursery, universities and other areas. Feels very targeted, hence this has to be about ideology. The income from the VAT will be a drop in the ocean as PP have said, and frankly just a guesstimate of what they could "earn" from this policy. The disruption to the system, however, might well be regrettable.

There's nothing in VAT law that says that if you apply it one part of a service or supply sector you have to apply it to everything in that sector. Not all types of food attract VAT, for example.

They've said this won't apply to children with EHCPs. The vast majority of children in specialist SEN schools have EHCPs.

twistyizzy · 29/06/2024 10:46

If I had £1 for every time I have been accused of being a Tory just because I oppose 1 of Labour's policies I would be able to afford to pay the 20% 😆.
It is such a lazy statement "you don't agree with Labour therefore you are a Tory". Doesn't bode well for scrutiny of Labour after the election. It is the old "if you aren't with us then you are against us".

Itsprobablynotcominhome · 29/06/2024 10:47

I'm still voting Labour in the hopes that they do manage to impose VAT on this luxury product.

Equanimitas · 29/06/2024 10:47

twistyizzy · 29/06/2024 07:26

It isn't about that. It's the fact that under a tested case it was found to be illegal. Labour knew that and previously accepted the ruling, this time they are ignoring it.

There have been no cases where British tax law has been found to be illegal under the EHCR. It's quite extraordinary that people are treating a 40 year old legal opinion as gospel.

Janwholovesjam · 29/06/2024 10:47

My money is on Labour introducing a much reduced rate on Private education. I think this is the old tactic of sowing the seeds of something people impacted are very concerned about and then introducing something less bad so everybody is just grateful it’s not as bad as they feared. Keeps the ‘tax the rich until they are also poor’ camp happy, stops the private educators kicking off, and stops them having to stump up the extra teachers from thin air.

twistyizzy · 29/06/2024 10:48

Equanimitas · 29/06/2024 10:45

There's nothing in VAT law that says that if you apply it one part of a service or supply sector you have to apply it to everything in that sector. Not all types of food attract VAT, for example.

They've said this won't apply to children with EHCPs. The vast majority of children in specialist SEN schools have EHCPs.

Wrong.
The vast majority of SEN kids in indi schools DONT have EHCPs because there is no benefit for them to have one. All this policy has done is to get 100,000 SEN kids starting the process of getting EHCPs all paid for by the state. These DC then will be exempt from VAT.

twistyizzy · 29/06/2024 10:48

Itsprobablynotcominhome · 29/06/2024 10:47

I'm still voting Labour in the hopes that they do manage to impose VAT on this luxury product.

VAT isn't a luxury tax.

Another76543 · 29/06/2024 10:49

Itsprobablynotcominhome · 29/06/2024 10:47

I'm still voting Labour in the hopes that they do manage to impose VAT on this luxury product.

A decent education shouldn’t be seen as a luxury. VAT isn’t a luxury tax anyway though. Caviar is VAT free, but loo roll is subject to VAT. The luxury element is entirely irrelevant.

Charlie2121 · 29/06/2024 10:49

Philandbill · 29/06/2024 10:33

You could always send your child to a state school too....

So your answer is for us to pay less tax and increase the burden on the state?

Scruffily · 29/06/2024 10:54

twistyizzy · 29/06/2024 08:09

Except it will. The "fair whack" is based on overly optimistic assumptions and was before Labour exempted state boarding schools and children with EHCPs. There has been a rush to get EHCPs in place (which costs the state money each time) and that will reduce the income even further (over 100,000 SEN DC in indi schools). The authors of THE IFS report admit they were overly optimistic and by the time Labour have exempted military families and % of DC leaving indi schools has impacted, the net income is likely to be £0. That's before the cost of legal challenges.

What "rush to get EHCPs in place"? EHCP numbers have been rising steadily over the years since they were brought in, but that has nothing to do with the prospect of VAT on school fees, not least because it's only recently that it's been suggested that they would be exempt.

People who come up with this sort of fiction have no idea how difficult it is to get an EHCP, the legal tests involved, and in particular the sort of evidence that has to be available to show that it's needed. You have to prove that your child has needs that cannot be met within normal maintained mainstream school resources, and to get a place in a specialist school you have to prove that they have needs that can't be met in a mainstream school even with extensive extra funding. Local authorities tend to resist all the way. You don't just fill in a form and get an EHCP with a private school place attached a couple of weeks later.

TheFallenMadonna · 29/06/2024 10:54

Charlie2121 · 29/06/2024 10:32

How is that relevant? They don’t get taxed extra if they don’t have one.

There seemed to be an assumption that the children with SEND in private schools would get an EHCP if they were assessed.

twistyizzy · 29/06/2024 10:57

Scruffily · 29/06/2024 10:54

What "rush to get EHCPs in place"? EHCP numbers have been rising steadily over the years since they were brought in, but that has nothing to do with the prospect of VAT on school fees, not least because it's only recently that it's been suggested that they would be exempt.

People who come up with this sort of fiction have no idea how difficult it is to get an EHCP, the legal tests involved, and in particular the sort of evidence that has to be available to show that it's needed. You have to prove that your child has needs that cannot be met within normal maintained mainstream school resources, and to get a place in a specialist school you have to prove that they have needs that can't be met in a mainstream school even with extensive extra funding. Local authorities tend to resist all the way. You don't just fill in a form and get an EHCP with a private school place attached a couple of weeks later.

The rush to get an EHCP is because they will then be exempt from paying VAT. Surely you can understand how an announcement like that would elicit behaviour change?
100,000 SEN DC in indi schools but only a small % have EHCPs at present

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