An unexpected partnership has formed between private schools, trade unions, and tax experts to urge Rachel Reeves to postpone a tax increase on private education. Concerns are rising that implementing VAT on school fees in the middle of the school year could lead to job losses and disrupt children’s education.
While the government remains firm on its decision, reports suggest some wavering due to potential lower revenue from VAT than initially anticipated. The final decision is expected to be announced during the Budget on October 30th.
Julie Robinson from the Independent Schools Council stated that even supporters of VAT on private schools agree that implementing it by January 1st is not realistic. The NASUWT teachers’ union also expressed worries about the impact on opportunities if the change is rushed.
Various organizations, including the Association of School and College Leaders, emphasized the need for a thorough impact assessment and consultation before implementing the VAT change. Tax experts from the Chartered Institute of Taxation and the Association of Taxation Technicians echoed concerns about the tight timeline for schools and HMRC to adjust to the new regulations.
Despite these concerns, the Treasury confirmed that the VAT plans will proceed as scheduled. Downing Street defended the decision, stating that closing the VAT loophole was a manifesto promise to fund new teachers. Rachel Reeves emphasized the importance of not being tied to ideological tax changes that may not yield the desired results.
The collaboration between private schools, trade unions, and tax experts showcases a shared concern for the potential consequences of implementing VAT on school fees without proper preparation. As the government moves forward with its plans, the voices of these stakeholders will continue to advocate for a more manageable timeline to avoid disruptions in the education sector.
