Pupils will ‘pay price’ for new tax on private school fees, Tories warn Reeves
The long-standing VAT exemption for private schools ends on New Year’s Day.
Pupils, parents and teachers face “paying the price” of a new tax on private school fees, the Conservatives have warned after the Chancellor welcomed an end to the “VAT break”.
Rachel Reeves has vowed “more teachers, higher standards and the best change in life for all our children”, as the long-standing VAT exemption for private schools ends on New Year’s Day.
But Tory shadow education secretary Laura Trott has said the move will “add pressure to the education system” in 2025.
She said: “This rise in VAT will do nothing to help state schools.
“The Labour Government are disrupting thousands of children’s education vindictively in the middle of the school year, and all it will do will add pressure to the education system.
“It will be pupils, parents and teachers from the state sector that will end up paying the price.”
Labour promised to “end the VAT exemption and business rates relief for private schools to invest in our state schools” in its 2024 general election manifesto.
The Government has claimed “thousands” of state schools will receive an uplift in their funding next year, with an extra £2.3 billion for the core schools budget.
Applying VAT at the standard rate of 20% on private school education and boarding fees will raise £1.5 billion in 2025, according to the Treasury, rising to £1.7 billion a year by 2029/30.
Ms Reeves said: “It’s time things are done differently.
“Ending the VAT break for private schools means an additional £1.7 billion a year that can go towards our state schools where 94% of this country’s children are educated.
“That means more teachers, higher standards, and the best chance in life for all our children as we deliver on our Plan for Change.”
Education Secretary Bridget Phillipson said: “High and rising standards cannot just be for families who can afford them, and we must build an education system where every child can achieve and thrive.
“Our ambitious Plan for Change sets out our clear mission to break the link between background and success and ending the VAT break enjoyed by private schools will provide much-needed investment in our state schools, to help recruit and retain expert teachers.”
