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.

I think what private school parents fail to accept is that there are a diversity of reasons why people support the policy.
They include:

1. A belief that private education is fundamentally unequal. I do not deny that some supporters of the policy are happy for it to have a negative impact on the sector for this reason.
2. An attempt to provide a more equitable VAT system. It is conidered fundamentally unfair that goods and services that are essentials and must be purchased by all income levels are subject to VAT, whereas private education a service that is mainly only affordable to higher income earners is not.
3. Raising additional tax revenue. As this thread and many others show, there is a diversity of opinions on whether there will be a net gain. I think on balance it is likely that there will be a small net gain. Will that solve all the problems in state education? Of course not, but given the dire state of the public finances any gain is welcome. Behavioural change is difficult to model and forecast, only time will tell what the result is.

My reasons for supporting the policy are essentially a mixture of 2 & 3. I accept that it will create difficulties for parents who can no longer afford private education. However, all policy decisions have negative impacts on some. Choices have to be made as is to what is best for society as a whole. I have no animosity towards parents who choose private education. I just think the service should be subject to VAT.

The main counter argument seems to be that by choosing private education parents are 'saving the state money' as the goverment does not have to fund the state option for your children. This is a fundamental musunderstanding of how taxation works. We do not get rebates or reduced tax rates if we dont use public services be they schools, libraries, hospitals or anything else. We pay tax so that we have a functioning society underpinned by adequate public services that benefit us all directly and indirectly. In the case of universal education we need a literate, numerate educated population for a functioning economy and society so we pay tax to support state education. This applies whether we have kids or not and whether we use state education for our kids or make a different choice.

Wow you seem to know a lot about me considering you don't know me.
I've worked, paying taxes, for over 20 years thanks. As a household we contribute more tax per year than the median wage.
What I'm not prepared to do is to pay more when I have other options
This is the problem with Labour, they just assume people will continue to pay tax so they can keep taxing middle income earners even though there then becomes a tipping point at which those middle income earner go "fuck this".
Currently 40% of workers prop up the whole system. That just isn't sustainable long term.

Wow it must be an awful way to spend your time, just, working for the money. Glad you can give it up and be a SAHM to fill your time.

100%.

Same.

People are disagreeing with you, that's all. People are suggesting something you don't like. That's not hate.
On the other hand, the OP has accused people of mere envy, gaslighting, suggested people need therapy, or they must be on benefits.

@pintofsnakebite really? Here is a selection of spiteful comments which seem to be more than just ‘disagreeing’?

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're only here for what you can take, not what you can give. and when society doesn't give you everything you want while also getting on its knees and grovelling at your feet, you throw a tantrum.

JustAnotherPoster00 · Yesterday 23:36
Have you thought of maybe taking in some ironing, selling some things on ebay/vinted? Perhaps buying more shop own brands in your weekly shop, also giving up takeaway coffee and subscription services can be a massive help 😉

Touchy lot aren't they 🤣🤣🤣

Perfect28 · Yesterday 22:00
I find it sickening, frankly. I find it utterly grotesque that some people think they are above others because they pay more in tax

Well, there’s the issue of SEN children re-entering the system that previously failed them and putting more pressure on resources. Maybe you don’t care because you don’t have SEN children. Then there’s the fact that schools are going to have to go over PAN in some places because the capacity for additional pupils doesn’t exist.

20% in one year is very different for 20% over 10 years. As it happens, private school parents do complain about fee rises. There were many discussions, including on this forum, during COVID for example. You probably didn’t bother to look at them because it didn’t impact you. From my own DC’s perspective, they reserve bursaries for pupils who may have to leave in key exam years so as to not disrupt their education. However, we’re talking about a couple of pupils per year, not the numbers who will be leaving now in some schools so that’s not a viable option.

I do have children with SEN actually, (not SEN children) in state school, and it's weird how you lot expect me to be more worried about the ones in private school than my own.

So I'm still waiting for a viable answer about how a tiny, tiny number of children changing school will damage my children's education. I'm really not scared of more children with SEN being educated with my children.

@Araminta1003 my children have more in common socially and culturally with a well off,middle class Saudi, Nigerian or Russian who attends a British private school than they do with many British children from different backgrounds. The much vaunted "diversity" of private schools is often largely based on appearance. As can be seen from the pictures in prospectuses....

You are neither raging nor a feminist. True feminism is letting a woman decide for herself if she wants to be ambitious, what "ambitious" actually means for her personally, whether she wants to be SAHM or career focussed etc.

I wonder how many grandparents will chip in (more) for fees if it makes the difference between their grandchildren staying in their current schools or having to move (and potentially move house too, so they can be sure of getting into an outstanding state school). I haven’t seen any modelling on this - it would be v hard to model.

However, I know of several families where the grandparents are contributing to school fees (not least to reduce their estate so less IHT is liable) and if they start paying an extra 4-5k or so annually that’s money they’d otherwise have spent on holidays, eating out, newer car, work on their houses, etc. All stuff that puts money into the economy rather than just being put into the general taxation pot.

Fair point, given you can gift 3k per annum.

For those who are pro VAT on school fees in U.K., why do other countries who have similar percentages of kids in private education like France, Germany etc not impose VAT too then? Exactly why are we the only country going to do this? Why do we have such a problem with private schools?
So in every other country kids go to private school and it’s no big deal. But here they are all mini Boris Johnson’s trying to exploit the masses with lies? Why do we blame private schools for the class system? In all other countries, education is a way of elevation and future investment in society. Why not here?

I’m not sure of the rules (we aren’t at that stage of school yet) but I think if they pay the school directly it’s not even a gift.

@Ubertomusic "You are neither raging nor a feminist. True feminism is letting a woman decide for herself if she wants to be ambitious, what "ambitious" actually means for her personally, whether she wants to be SAHM or career focussed etc."

That's actually not what feminism means. But this is not the thread for that discussion!

@Heatherbell1978 I agree-I find that attitude a little strange too!

I have a theory.

Some see it as akin to not being able to give your kids the latest Nikes, or the newest XBox - education holds a mirror up to how you perceive yourself as a parent (rightly or wrongly).

Big cars and fancy houses also invoke feelings of inadequacy in many - although not as acutely I suspect.

My local state school - a significant number of parents drop their kids off in 70k Mercs etc., and I always think, why not fund xx years of PS education with that?
Different priorities, I guess.

And before anyone steams in - none of this is said to run down state schools, the kids, or the parents.

This may be your personal choice but generally the stats disprove your statement. "The rich" are leaving the UK in droves. I've no opinion on this, just pointing out the facts.

Labour's justification of financial benefit of this policy is based on the assumption that only a very small percentage of parents will move their kids to state and those who do will spend the amounts saved on goods and services and still generate VAT.

This and many other threads show that a lot of parents forced into switching sector will either reduce their hours or retire, but there is another consequence here.

At present it takes 300-350k on average to put a child through 14 years of PS. We already discussed that really wealthy will absorb thus making PS even more elitistic.
Those middle classes who can't afford it anymore are very unlikely just to buy more stuff or go out with this money. The most likely destination of 300k saved per child will be pensions and houses. Some fraction will go to extra curriculums which mainly don't attract VAT and holiday abroad. These group of aspirational parent are savvy enough to support their kids both educationally and financially to arrange their financial affairs in other ways.

Right now out of two kids with the same grades Uni admissions will favour state one over PS so the privilege is known.

In some years time you have two state kids, one still benefited from all support from parents who couldn't afford PS gave them AND 300k saved for their uni/house deposit etc etc and another state kid who has none of this but still can't be differentiated and supported in uni admissions with massive difference in financial security.

In some years time you have two state kids, one still benefited from all support from parents who couldn't afford PS gave them AND 300k saved for their uni/house deposit etc etc and another state kid who has none of this but still can't be differentiated and supported in uni admissions with massive difference in financial security.

How can you simultaneously not afford PS and yet have £300k saved?

I suspect that a very small % of private school parents post on here-and of that % a very small number will actually switch. Prepared to be proved wrong, but....

It is already happening though. 10% in DDs year. 1000s of case studies whereby parents have already given 1 term's notice.

@EverythingAllatOnceAllTheTime "And before anyone steams in - none of this is said to run down state schools, the kids, or the parents"

Not steaming in. Just popping gently in to 🤣🤣🤣🤣

@twistyizzy interested to see the case studies- where are they published?

Within the ENT group so not in public domain. That's how I know over 30+ LAs have said 0 spaces for in year transfers for specific year groups so far in for Jan 25, we have been sent the emails.

LOL, fair enough.