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VAT on school fees - High Court Challenge.

1000 replies

EverythingAllatOnceAllTheTime · 08/09/2024 04:17

Labour’s plan to impose VAT on private school fees in January faces a High Court legal challenge over claims it breaches human rights law.

Lawyers have written to HM Treasury arguing the policy discriminates against special needs children and has threatened court action if it is not dropped.

Showtime…

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14
ItsAShame2 · 09/09/2024 00:35

onthehoof · 08/09/2024 19:38

@ItsAShame2 but university is not compulsory, that's the difference.

School is not compulsory either. Children from age 16 don’t need to go to school - but the vat will still affects kids in 6th form who can’t be moved in these crucial years.
children don’t need to go to school - they can be home schooled.

ClockwiseHoneysuckle · 09/09/2024 00:37

I would hesitate to crowdfund this one, mainly because the solicitor concerned has a bit of a track record of lost challenges on behalf of right-wing Christian organisations, including so-called pro-lifers. For example, the case of the delightful Mr Hone who sought an injunction to prevent his girlfriend having a termination, Rev Joanna Jepson's challenge to late terminations for serious disability, and a challenge to proposals to bring the age of consent for gay people into line with the age of consent for straights.

Contributing to crowdfunding for this one could well end up simply funding the claimant's liability to pay the defence's costs.

ClockwiseHoneysuckle · 09/09/2024 00:40

Ubertomusic · 09/09/2024 00:26

Only the UK does it to French kids as well as everyone else. Lycée Français is PS.

You're missing the point. We have no right to object to where the French choose to impose tax, and the same applies the other way round. No-one forces the French to operate private schools in the UK.

Ubertomusic · 09/09/2024 00:50

ClockwiseHoneysuckle · 09/09/2024 00:40

You're missing the point. We have no right to object to where the French choose to impose tax, and the same applies the other way round. No-one forces the French to operate private schools in the UK.

So do you suggest, hypothetically, that if English expat children experience some sort of limitation of access to education in British values etc imposed by a foreign govt, the UK would be OK with that and won't complain?

Hmmm... I don't even know if it's good or bad. But certainly different. I would say VERY different, like thinking that education is a luxury which is pure madness to any sensible government that wants their country develop. Yet many posters on the thread keep repeating this nonsense so I assume it's widespread in the UK 🤯🤔

Araminta1003 · 09/09/2024 04:03

I am assuming the French state is going to have to pay the VAT for diplomatic staff in eg London attending the French lycee so there is a direct financial interest, however small relatively speaking to GDP, and the same for US diplomatic staff and expat attending the American School etc. to stay in the US system. So if you have a reciprocal arrangement with other countries it is symbolic?

Araminta1003 · 09/09/2024 04:07

And then there are the Ukrainian children on bursaries etc which the private schools can hopefully somehow continue but if not, it’s hardly a good look internationally is it. And the Chinese children etc and Indian children in boarding schools etc - the Government does need to consider these ramifications. These parents may well complain to their embassies and some may well have some influence.

Araminta1003 · 09/09/2024 04:16

Legally though do diplomatic staff of foreign countries pay income taxes here? Is this proposed VAT tax in essence really a VAT or a stealth wealth tax etc and what are the political ramifications.
Is it ok to involve foreign governments in domestic political own party issues like this “VAT”business. Is it OK for them to comment if it directly affects their citizens? Etc etc

ThinkingForward · 09/09/2024 05:45

Werweisswohin · 08/09/2024 22:59

They should be treated like any other business, not sure how much simpler to make this for you.

Tax complexity is bad for good people and good for bad people in the main. Tax legislation already exceeds 21000 pages through tinkering rather than reform. While this might be a nerdy point, like any change you needs to look at how to implement this.

Overall much of the "difficult legislation" is verbose and looks like an 8 year olds written account of what they did over the summer holiday.

If the "agenda" is about reducing complexity or raising money then this certainly doesn't achieve that.

The government if it was serious about addressing it's "22bn black hole" or equality then this isn't done by investing time and effort in this small beer side show around vat on fees.

There is a circa £60-100bn/ yr shortfall in public sector pensions, this amounts to 10+% of the governments total spending.

Tinkering with fees is a waste of parliamentary and administrative time unless it's part of a much broader approach to simplify tax.

If you want to be pro growth, reform education and fund it then you start in a very different place.

strawberrybubblegum · 09/09/2024 05:50

Araminta1003 · 09/09/2024 04:16

Legally though do diplomatic staff of foreign countries pay income taxes here? Is this proposed VAT tax in essence really a VAT or a stealth wealth tax etc and what are the political ramifications.
Is it ok to involve foreign governments in domestic political own party issues like this “VAT”business. Is it OK for them to comment if it directly affects their citizens? Etc etc

I think they're genuinely more concerned for their 139k expats than the diplomatic staff they pay for directly. The French do take education seriously - they don't have our weird inverse snobbery about it - and they are quite bemused about our repeated acts of self-sabotage (like Brexit).

Yes, of course we're legally entitled to impose any tax we choose on French nationals living in the UK.

But the French government is also perfectly entitled to comment on how a politically-motivated tax which isn't imposed anywhere else in the world will impact French expats in the UK.

And since no EU country imposes this tax on our expats in the EU, it's reasonable for them to see it as hostile: in the same way as unilateral import taxes are hostile.

ThinkingForward · 09/09/2024 06:08

Werweisswohin · 08/09/2024 22:58

That's quite a varied list.
It's interesting you wrote rent but not mortgage.

Accomodation is a service, adding a transaction tax for repayment would be difficult to work, you would end up with everything VATable but everyone vat registered so no one would pay vat. I suppose you could break out the advice/ product/ legal fees often at the front of a mortgage and charge vat on them.

If we are flattening the tax treatment then that would scrap section 26 on BTL.

There is so much bad taxation this just seems like a waste of oxygen. If I were to have a few things on my list to amend.

> Lots of changes to NICs

  • Scrap special classes and treatments of Sole traders NICs
  • increase contributions years to 45 for full pension
  • restore links between contributions and entitlement / rate for benefits ( pension/ unemployment etc)
> Scrapping sdlt and implementing the Lawson CGT regime at marginal income tax rates across all gains including principle private residence ( I would like to see a portion of this dependant on the property efficiency) > 5 year rolling tax allowance to smooth out the ups and downs. > Scrapping council tax replace with a poll tax + accomodation tax with a personal space allowance. Again with a link to efficiency of the building. > Base Employer NICs on total number of staff and stop letting big employers (typically in retail and distribution) off lightly, by them artificially capping peoples hours and then getting them to claim in work benefits, UK taxpayer is effectively subsidising many well known retailers for example.

May be I should set up a thread for tax policy/legislation. I can't imagine many people would comment.

strawberrybubblegum · 09/09/2024 06:17

ClockwiseHoneysuckle · 09/09/2024 00:04

It's the same as the right to family life. The government isn't required to give you a family - that's up to you. But they're not allowed to unreasonably prevent it.

But they aren't unreasonably preventing it. They are saying that parents are absolutely permitted to continue sending their children to private schools, but they may have to pay a bit more. If you can claim that that prevents parents from accessing private education, you would have to get over the problem that the differentiation between, the cheapest and most expensive private boarding schools is a whopping £40K per year, and no-one challenges the government for failing to make it easier for everyone to send their children to the likes of Eton and Brighton College.

But they aren't unreasonably preventing it.

Imposing a tax can be done for different reasons
a) to raise money. Income tax is an example. You recognise that the tax is a disincentive to something good (productivity) but you need the money for important social projects, so you minimise the disincentive whilst maximising the money raised

b) to change behaviour. There are additional taxes on alcohol and tobacco, because these impose social and financial costs. Part of the reason for the extra tax is to cover direct cost like increased NHS spending, but it's also intended to discourage people from doing it

If the government was imposing this VAT for reason (a) they could argue that they need the money, and they aren't deliberately preventing plurality of education.

But they're not.

The exact same politicians have previously attempted to ban private education (and only stopped when advised it was unlawful). This is a continuation of the same policy aim.

They've ignored economic advice that rather than raising money, this policy is likely to be net negative. They've made no attempt to analyse the economic impact of the policy because they don't care.

The purpose of this policy isn't to raise money, it's social engineering.

Nobody expects the government to make it easier for people to access private education or an expensive boarding school. Again: it's a negative right. They're not required to give it to you. They're just not permitted to prevent it or deliberately make it harder.

They are breaching the right to education when they deliberately impose taxes with the purpose of pushing people out of private education and into state.

The government's behaviour is contemptible.

strawberrybubblegum · 09/09/2024 06:36

ClockwiseHoneysuckle · 08/09/2024 23:34

What do you think happens if the parent decides that they can't afford to pay the VAT? The state is landed with an £8k per year bill to educate them. You need three children in private school paying VAT on average private school fees to cover the cost of one non-SEN child choosing state over private. This is for the policy to remain cost neutral.

As it's estimated that over 90% of current private school pupils will stay where they are, it's hardly going to be difficult to achieve that 3:1 ratio you suggest is necessary.

The economic impact isn't as simple as offsetting the state education cost of the children moving against the VAT of the children staying. There are quite a lot of knock-on impacts, such as the income tax of the teachers employed.

The Adam Smith report gives a bit more detail. You may disagree with their conclusion: that 10% of children who would have gone private instead choosing state is the break-even point where the state starts losing money. But if you read it, you'll have a better understanding of the economic analysis the government should be doing but aren't.

EverythingAllatOnceAllTheTime · 09/09/2024 06:43

For the Labour apologists on here - CurlewKate and Werweiss et al, know this.

Me, and others like me, will continue to keep calling out Labour on their seemingly never-ending stream
of vicious policy, so far aimed at the old and the young.

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EverythingAllatOnceAllTheTime · 09/09/2024 06:45

One for a fresh thread perhaps…

Trade unions will “never be content”, the boss of the train drivers union has said just weeks after striking a bumper pay deal with the new Government.

Mick Whelan, the general secretary of Aslef, suggested there would be nothing Labour could do to appease the movement completely, despite ministers’ claims that relations are entering a “new era”.

Train drivers offered bumper pay rise from Starmer to end strikes

The Government has offered a 15 per cent pay rise over three years

https://www.telegraph.co.uk/news/2024/08/14/train-drivers-strikes-labour-starmer-payrise/

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Araminta1003 · 09/09/2024 06:52

@strawberrybubblegum - I agree with you, I can’t see an economic justification in this tax. It is a blatant deterrent and a classic example as such. Interesting interview question!

strawberrybubblegum · 09/09/2024 06:53

Tell me if you set up that thread, @ThinkingForward - maybe in the money matters section. That's a really interesting set of suggestions, and I'd like to learn more. It's not my field (as I'm sure is obvious) but this whole fiasco has made me quite a lot more interested in tax.

Would like to understand :

  • A 5 year rolling tax allowance seems fairer, but it's likely to reduce tax take, which benefits (unfairly) from those peaks. Are there economic benefits to 'fairer' taxes?
  • How does basing employer NICs on total number of staff help? I just don't know enough to follow
  • Consequences of CGT on residential property. It feels like a huge anomaly just now. Is it just too hard to introduce politically, or are there other reasons? Impact of crazy-high stamp duty in the SE would give good predictive data on consequences.
But agree that we probably shouldn't derail this thread.
Bumpitybumper · 09/09/2024 06:59

ClockwiseHoneysuckle · 08/09/2024 23:30

Not exactly. She applied for an EHCP and didn't succeed, but didn't pursue it through the tribunal. She lives in Kent, which is admittedly terrible for SEN, but they tend to give in when challenged on refusals to issue EHCPs - and the success rate for this type of appeal is around 98%.. It's understandable that she chose to go for the fee paying option rather than go through a tribunal appeal, but she must have known there was a risk that fees would go up, and she still has the EHCP option. She can't really argue that the state won't provide the required education when she hasn't used the avenues the state gives her for accessing it.

This is absolutely bonkers.

The mother has applied for an ECHP and failed to get one. The state has absolutely no interest in meeting the needs of her child. She has chosen to pay privately to meet their needs rather than to take an overstretched and reluctant LA to a potentially lengthy and difficult tribunal to force them to meet the needs of her child. Even if the child gets the ECHP there is a high likelihood that Kent LA will struggle to meet the conditions of the ECHP adequately and as the mother has to fight them every step of the way, the child is losing the opportunity for an adequate education.

How on earth is this better than just letting the mother pay for the provision herself? This way the state saves a costly bill, not only from not having to educate a SEN child but also from not having to be dragged through all these tribunals. Any VAT raised will be eroded so quickly be cases like this that it's obvious this policy will make very little money and cause a lot of pain and anguish to parents and children.

EasternStandard · 09/09/2024 07:08

EverythingAllatOnceAllTheTime · 09/09/2024 06:43

For the Labour apologists on here - CurlewKate and Werweiss et al, know this.

Me, and others like me, will continue to keep calling out Labour on their seemingly never-ending stream
of vicious policy, so far aimed at the old and the young.

Mn has been pro Labour for a while, with some attempts to drive out people who disagree by the staunchest Labour supporters

On the policy aimed at old and young, one this they have in common is they can't strike, and no unions

EverythingAllatOnceAllTheTime · 09/09/2024 07:10

EasternStandard · 09/09/2024 07:08

Mn has been pro Labour for a while, with some attempts to drive out people who disagree by the staunchest Labour supporters

On the policy aimed at old and young, one this they have in common is they can't strike, and no unions

I think their loyalty will be severely tested during the coming weeks and months.

Terrible policy heaped upon terrible policy.

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Araminta1003 · 09/09/2024 07:13

“On the policy aimed at old and young, one this they have in common is they can't strike, and no unions“

Parent activism is on the rise, in all sectors. Those with children with SEN should unite as well.

ThinkingForward · 09/09/2024 07:14

@strawberrybubblegum

It is funny how some on here feel that things will get better in the state sector by putting everyone in the same canoe with the justification that the parents joining the state sector will have the power to improve it.

Why would a government who actively alienates and ignores them on broadly the same issue suddenly start listening to that group?

My experience with the state sector is that change is actively resisted.

Araminta1003 · 09/09/2024 07:15

And the baby boomers were radicals in their times so I doubt we have heard the last of the WFA either.

EverythingAllatOnceAllTheTime · 09/09/2024 07:16

Araminta1003 · 09/09/2024 07:15

And the baby boomers were radicals in their times so I doubt we have heard the last of the WFA either.

Absolutely.

A Labour rebellion seems likely.

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EasternStandard · 09/09/2024 07:16

EverythingAllatOnceAllTheTime · 09/09/2024 07:10

I think their loyalty will be severely tested during the coming weeks and months.

Terrible policy heaped upon terrible policy.

It probably won't come up in much some threads on here but public opinion already shows the disapproval in polls, especially for KS

EverythingAllatOnceAllTheTime · 09/09/2024 07:17

EasternStandard · 09/09/2024 07:16

It probably won't come up in much some threads on here but public opinion already shows the disapproval in polls, especially for KS

Quite so.

Evidently, he is prepared to be unpopular. Oddly, being unpopular doesn’t necessarily result in great policy - which is what he appears to think.

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