Fears grow about Labour’s private school VAT raid
The government’s planned tax raid on private schools has already pushed thousands of pupils into the state sector.
According to analysis published by the Independent Schools Council (ISC) last week, there was a 1.7 per cent drop in the number of children attending private school in the last year.
The figures compared the number of children starting private schools this September with the same month a year ago. This means that 10,000 pupils have been pushed out of the private sector, with the largest decrease coming in year seven – the first year of secondary school.
The ISC estimated that it would cost around £93m to educate those pupils in state school.
Independent schools currently do not have to charge VAT because there is an exemption for the supply of education. Labour have pledged to end this exemption, estimating that imposing VAT on private school fees would raise £1.7bn per year.
The changes are set to come into force at the start of next year, but ,any organisations in the education sector – including some that back the changes – have called for the measure to be delayed until next September.
Tax experts have warned that schools would have little time to adapt, with bills for the January term often sent out in December.
The NASUWT teaching union, which supports the policy, said it was concerned about redundancies in the sector, asking for “a more reasonable timeframe” to be implemented.
“Even those who are in favour of imposing VAT on the independent sector are saying that January 1 is not feasible,” Julie Robinson, chief executive of the ISC, told the Guardian.
The Treasury confirmed to CityAM that it was not considering pushing back the date for the tax changes.
“Ending tax breaks on private schools will help to raise the revenue needed to fund our education priorities for next year, such as recruiting 6,500 new teachers,” it said.