VAT on school fees (you have to read this!)

[EverythingAllatOnceAllTheTime]

Government’s private schools VAT raid ‘could cost taxpayer £1.8bn’

Parents who are forced out of sector are likely to work less or even quit jobs, according to think tank research.

Adam Smith Institute.

Well in my village most of the mums don’t work full time (or at all) unless they have grandparent help. You’re also missing the point, I wouldn’t need to work full time if I didn’t pay school fees.

Re SEN, the reality is that a lot of children suffer because they don’t get proper support. It’s easy to see why some parents use every means they have to get help for their kids.

20% over 10 years is very different to 20% in one year especially when that comes at a time when other household living expenses have increased so much. The £400 extra per month we need to find for VAT wouldn’t be such an issue if our outgoings hadn’t already increased by £1700 per month. We can find the money but not everyone can. For some people, the bubble has popped.

And if 93% of parents can’t fix state schools, a few more isn’t going to magically transform them.

Again, what do you think current private school parents will accomplish in state that 93% of parents have not been able to achieve?

Labour may want this to generate revenue, but it probably won’t. 20% over 10 years is quite different from the 20+% in one year that many will experience- some will adapt, but many will not. You can dislike the Adam Smith Institute, but the main driver of the difference in their analysis vs.IFS is the proportion that would Leave / not start private education. If only 10% leave private, the policy raises no income- to me that is a very big bet on a very fine margin or error.

It's not bizarre, quite a few doctors I know think the same.

I find this whole ‘I will give up work as I don’t have to pay fees’ mentality so so bizarre

I don’t have to work financially as my husband earns enough but I chose to because I want an independent career

My kids are in state school as it’s lovely here so we’re lucky. However I wouldn’t send them to private schools, that’s another debate

But I don’t think a few women giving up work and probably doing something they like or spending more time with their family is actually a bad thing, and I don’t think it is going to have the kind of impact that is being put forward here. Most of the people I know with kids in private school, the women don’t earn much or don’t work, so their tax contributions aren’t huge anyway

The speculative economics here is pretty ropey

And personally I am more worried about other things impacting the economy and the cost of living crisis impacting lower income families

For me, Family comes first, ‘society’ second.

Call me selfish - I can live with that.

Spoken like a true fan of the Adam Smith Institute.

Well somebody in the family must be working, or are they all living in a cardboard box hnder a bridge?

If you are not in a position to stump up a few more thousands per year and are about to go from two incomes to one, where is all the money going to come from that you are planning to put into investments and spend on loads of tutoring?

I suggest keeping your job, quite honestly.

What a bizarre response, as you might say.

So you are one of those living hand-to-mouth then, without savings, investments, reserves, or other household income.

Right - it explains much about your posts.

Surely these parents won’t work less or stop working so hard? According to Mumsnet they are the hardest working most frugal people on the planet and if we all worked a bit harder and didn’t go on so many holidays all our kids could go private!

I know quite a few private school parents back in the UK (I live overseas). They aren't terribly pleased about the VAT, but I only know one who's planning to yank their kid (and even in that family, the woman's not thinking about quitting her job as well).

I have no doubt that the job-quitters on this thread exist and are real people speaking in earnest and will genuinely do what they are saying they will, but I would be surprised if they were more than a small number of private school parents.

In an era of longer life expectencies and huge worries about getting offspring on the property ladder, the majority of people who decide to stop paying school fees will find plenty of other things that they will want to put money into (housing deposits etc.), and are probably ill-advised to just stop working in their 40s or 50s or whatever, especially given that the "alternatives" to private school for those who are serious about their kids' education - property in good catchment area, tutoring, more childcare - also cost a fair bit of money.

You chose to live in a very rural area, and this choice had consequences. You chose to stay in your present job earning your present salary even though Labour floated the VAT policy long before the election.

You bought a service whose price has risen to a level you can no longer afford, but there are many who will absorb the extra cost and carry on, andnsimilarly there are many who could never have afforded private school and did the best they could elsewhere.

Some chose to live in areas where their local primary offered wraparound care. It absolutely is disingenuous to claim you've saved the state £100k when there are people who have bought homes in areas where there are good state schools and wraparound care, and have absorbed the mortgage debt and acceptedbthe necessity for two incomes that enables this choice. People pay and pay and pay for education and childcare in the UK. Your plight is not unusual at all.

Essentially, parents who are saying they'll give up work, and their decision doesn't seem to make a dent in the family finances, are a group of extremely privileged people. Maybe you can understand that this is where the origin of the image problem lies.

This policy is so shortsighted. There are only like 600k tax payers that basically fund the majority of taxes and there are nearly 600k kids in the private sector. Go figure.

Attacking people’s children who are in that group primarily and making them feel a certain way, as evidenced on these threads, is complete madness if you actually care about society and public services. Even if they pay the VAT, this policy has made that group dislike Labour, their kids will remember it as they hear it at school, and these people will find the savings by adjusting their behaviour in other ways - I doubt that will be in the tax payer’s favour, The gaslighting from those in charge on this issue is utter madness. Really makes me worry for the country, even more.

Oh @twistyizzy thank you so much for paying your taxes and funding your child's education and removing the state's obligation. I had no idea it was such a philanthropic act. Silly me! I thought it was removing the need to mix with riff raff.

You can be secure in the knowledge that the state educated children of us peasants will be busy providing all the services you and your family rely on like cleaners, hospital workers, and refuse collectors. And carers in your old age.

@Araminta1003 on the other hand, there is just a chance that it will help to create a fairer society with less entrenched inequality and privilege. Worth a try eh?

Of course it makes sense. We can't afford VAT therefore we will go to state therefore we won't have any fees to pay so I can give up work

@BalconyBra - at what cost? And “a chance”. Inequality is massively entrenched in the state education sector you know as well. I have had no issue getting my DC a great state education, it’s entrenched privilege that has enabled me to do that.

@Araminta1003 but less entrenched. Every little helps!

@twistyizzy I'm sure the state school PTA and Governing Board could make excellent use of your skills and spare time

I have no intention of doing that. If so many state parents hate me so much why on earth would I help out?
There are sufficient numbers of SAHM in state sector to fill those volunteering roles.

@BalconyBra - if the U.K. were the only country in the world and borders were controlled, maybe. But seeing the world is quite global, including education, and privileged people can vote with their feet, absolutely not worth the gamble given the public’s dire finances already.

You could apply the same argument to everything with a rateable value.

“I only buy clothes, transport, fuel, holidays, services, cars, tech, household goods, takeaways and meals out with my wages. DH buys non rateable food with his. The VAT has gone from 8 to TWENTY PERCENT so we are not buying those things anymore so I’m being forced to quit my job and won’t pay income tax anymore”

That average annual VAT bill is £6K - you aren’t alone in paying VAT. Everyone else in the country sets a budget for their purchases inclusive of VAT and can’t afford things that are the budget plus 20%. This isn’t specific to you. If we decide to budget £100 a month for eating out it doesn’t mean I can spend £125. If I budget £30k for a new car I don’t look at ones that are £36k. If I decide I can afford £500 for a new coat and boots and some jeans and jumpers for the winter then I don’t spend £625.

Private schools aren’t a “highly successful sector” They are a sector benefitting from tax breaks that other sectors can only dream of. My sector pays 20%. My business pays over £100k a year. I would be a much more successful business if I had that 100k for investment and wages and could offer customers a better deal so they would buy more and more often. Why shouldn’t the tax breaks private schools get apply to my business too? Why is it so important that money to the treasury in VAT receipts doesn’t apply to the things you personally buy?

An excellent post. Sadly they are still incapable of unwilling to consider it.

I also find it quite bizarre. I have a DS at private school and a DD at state (who may move in the future) but have always worked full time. I don't 'work to pay fees', I have a career. My salary more than covers the fees but we pool our income and then pay fees and all other expenses. Of course I wholeheartedly disagree with tax on school fees for all the reasons we know but it feels a bit, I don't know, unambitious for woman to state their salary pays fees so they might as well not work. Or am I just a raging feminist who wants her own career, pension etc. The school my kids go to would make no difference to this.