Labour’s plans for VAT on Private Schools

[Busydadof2]

The Labour Party has proposed introduction of VAT on private schools.

In the scheme of things the money they will bring in from this is tiny compared with total expenditure on state schools, while it will drive more burden on the state system as some parents leave private schools. I think this is a populist ploy to get traditional Labour voters to vote for what is in any other sense a centrist party.

Have you considered signing this petition to make sure the policy gets scrutinised and the weight of public sentiment against it is known?

Change.org petition: Stop Labour from adding 20% VAT to private school fees and forcing kids to change schools

www.change.org/p/stop-labour-from-adding-20-vat-to-private-school-fees-and-forcing-kids-to-change-schools

Various perspectives from the signatories of this vote come to mind and resonate with our own situation, including this: “I work in a state school with over 30 in a class and oversubscribed. My 2 kids went or go to private schools and we have sacrificed loads to do this. We are NOT wealthy, many of the kids at the school I work at live in bigger houses and have much more disposable income than we do. We chose to send our kids to private school rather than live in a bigger house instead of our semi detached on a main road. We holiday in the UK every year and I work full time. I buy my clothes on the high street or in charity shops. Many parents at the school my kids attend are in exactly the same situation. I agree there are some very wealthy parents there too and the addition of VAT will not even make an impact on them, they will pay it without batting an eyelid. All this will do is push the kids like ours back into an already oversubscribed state system, increase class sizes even more and create a bigger divide as private education will become truly elitist.”

@Mia85 you are scare mongering. No one has ever suggested that will happen.
It is a strawman.
And I am well aware of the legal framework, but your argument is still not logical. Private schools should be treated differently as the state provides free state schools with private schools being a choice some parents make.

Yes you’ve summed it up well

You are projecting.
What I see is whinging, moaning, hyperbole and strawmanning.

My post is absolutely logical and does not contain a strawman. I said The argument is not that VAT on private schools entails VAT on university fees but that it paves the way for doing so. That is absolutely correct.

As I said in the previous post, once the rule that education is an exempt supply is removed then it is possible to make arguments either way as to whether University fees should also have VAT added. I made no comment on the strength of the relative normative arguments, merely that the mechanisms would be in place to do so relatively straightforwardly.

@Mia85

"The argument is not that VAT on private schools entails VAT on university fees but that it paves the way for doing so. That is absolutely correct."

That's the slippery slope fallacy.

@Mia85

... a version of a straw man.

I’m waiting for the additional tax on houses in the pricey catchments of good state schools. Only payable by people who move in from outside the catchment area.

The squealing from middle class ‘progressives’ would be great. Terrible luxury it is, parading your principles and then using your money to game the school system you argue for.

No it isn't. It's a point about the way the law and VAT notice are structured (see above).

@Mia85 we know about the law currently. You are still strawmanning. The law will be changed so vat is only payable on private schools.

Christ you are all well off if you pay for private schools. Why instead of whinging on mumsnet do you not just go out and do a bit of extra work to cover the vat? I would be embarrassed to whinge so much.

Well I have to say that the quality of discussion on this issue tends to suggest that many people (not making a particular comments about you), including those proposing it, do not understand the way that the law is currently structured.

My post is entirely factual and doesn't enter into the discussion about what should happen save for noting that there are arguments either way. Indeed it notes that That does not mean that VAT will be added to University fees as it is perfectly possible to design the law so that it does not apply to higher education or so that it only applies to indepdent schools. But it does put in place the legal regime that could also extend to any form of educational supply with a simply amendment.

I don't think there's any reason to be so unpleasant. There is nothing in the slightest that is a strawman in my message.

Completely agree! We are in this exact same situation. Our child isn't able to be supported properly in the state system (for medical reasons, needs closer supervision that a 30+ class couldn't provide, unfortunately) so we are having to pay to go private. We are not wealthy and the VAT increase will be a real struggle for us.

@Mia85

Saying something 'paves the way' for some, uncertain but unpopular future event is a classic slippery slope argument. You couldn't have phrased it better. If you're saying the changes would de facto create the future scenario through inevitable legal consequences, say so. You'd still be wrong, because any new legislation could address that. It's scaremongering 101.

Have you read my whole original post? I am not quite sure why you are making these personal attacks but I would have thought it very clear from that post that If you're saying the changes would de facto create the future scenario through inevitable legal consequences, say so is not at all what I am saying.

I really am not making any form of scaremongering post. I posted a very facutal point about the structure of the VAT notice on education. There is no need to be so unpleasant.

@Mia85 but the legislation is being changed so that does not happen. So your argument is pretty irrelevant.

Please point out where I have been unpleasant. It seems you are saying the VAT notice as it applies to education means it would necessarily lead to tuition fees and other HE costs being subject to VAT. That seems to be saying it's an inevitable consequence. I'm saying new legislation could prevent that eventuality. We set our own VAT rules now - don't you remember, Reece-Mogg said it would be less than 5% after Brexit?

I am not quite sure why I am continuing this conversation but I am at a loss as to how you get to that point from my post. I said the following, which says precisely the opposite of what you are suggesting.

That does not mean that VAT will be added to University fees as it is perfectly possible to design the law so that it does not apply to higher education or so that it only applies to independent schools. But it does put in place the legal regime that could also extend to any form of educational supply with a simple amendment.

@Mia85

Wow, so it was a slippery slope argument after all! 😂😂😂

My last response to this but no it isn't. It's a point about legal reform and the ease of amendment. Not the political arguments. That was clear from my post.

Of course private schools are a choice.

Going to University is also a choice, some might even say a luxury.

Given that why should Uni fees be exempt from VAT?

This is an informed assessment on the potential impact of VAT on private fees from the IFS. In essence, VAT only results in an increase in revenue for state schools - IF parents in the sector find the money and stay in the private sector or if they leave and spend the new disposable income on goods and services that also result in tax revenue. I presume tutoring wont count as no VAT on that as far as I can tell. If they choose to save that money and spend it on uni fees, house deposits for their kids - the promised funds dont materialise

So for those that hope this policy will raise the promised £1.6 billion (which is approximately 2% of the state school budget and they say will be targetted at the most disadvantaged), you really should be encouraging those 'whinging' as you call it to stay in the private sector and find the increase. Extra jobs as you say. You need their efforts to support your kids. Their tenacity and sacrifices is Labour's ONLY plan to improve your kids education!

https://ifs.org.uk/publications/tax-private-school-fees-and-state-school-spending

This would be funny if it wasn't laughable. On a serious note, really hope people start to ask Labour for a state school improvement plan if the money hoped doesnt materialise. I would say I have no dog in the race but an uneducated society affects us all indirectly and directly so it is in all our interest that basic education works at least to university level in the UK

Schools don't have to pass the VAT on to parents, do they. They may have to become a bit more transparent on what they're actually spending their "lack of profits" on when the UK tax payer ceases to subsidise them via VAT relief.

The taxpayer isn’t subsidising fee paying

Taxpayers who use it are paying twice though and decreasing burden on the state

I’d love to know the rest of Labour’s plan to improve the state Education sector. This is a ridiculous and bitter policy.

The taxpayer is subsidising private schools through the tax exemption they have with their charitable status. They're not charities so that money should be given back to the taxpayer.