Union warns plans to remove private schools’ tax reliefs would impact state sector

Union warns plans to remove private schools’ tax reliefs would impact state sector

Fresh proposals by the Labour Party to remove the charitable status of independent schools would also have a negative impact on state schools, a teaching union has warned.

During its annual conference, Labour Leader, Sir Kier Starmer outlined plans, if the party were to gain power, to remove a number of the tax reliefs currently enjoyed by many private schools in order to raise revenue for the Treasury.

Proposals include an end to the charitable status of England’s independent schools, which Labour has calculated would raise around £1.6 billion in VAT and £100 million in business rates.

However, Geoff Barton, General Secretary of the Association of School and College Leaders, raised concerns that those who could no longer afford a private education as a result of increased school running costs being passed onto parents, would lead to additional strain on the state sector.

He said: “We are happy to explore this proposal in more detail, but our concern is that it would result in many small independent schools having to close.

“This would be disruptive to the pupils and staff involved, and would most likely end up with many displaced pupils moving into the state system with a consequent increased cost on public funds that would erode the extra income that the policy is aimed at raising.”

Meanwhile, Simon Hyde, General Secretary of the Headmasters’ and Headmistresses’ Conference, suggested that removing the charitable status of independent schools would not have the desired effect intended by Labour and would instead  cost the Treasury, as schools would be eligible for VAT recovery.

He said:  “There are only 1,300 charitable status fee-charging schools so charging VAT and scrapping business rates relief for these schools would generate at best only £200 per state school pupil. As more private schools closed, this would gradually fall.”  Contact our education team for advice.

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Union warns plans to remove private schools’ tax reliefs would impact state sector
Union warns plans to remove private schools’ tax reliefs would impact state sector