VAT: Independent Schools Debate

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Department: HM Treasury

VAT: Independent Schools

Mike Amesbury Excerpts
Tuesday 8th October 2024

(2 months, 2 weeks ago)

Commons Chamber
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Damian Hinds Portrait Damian Hinds
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The hon. Gentleman is right about the financial sacrifices some make. Let us be clear: it is possible to tax wealthier people or people with a higher income more, but the Government should be honest about it. The way to do so is through the income tax system, not through a choice that people make to have their child in an independent school. The hon. Gentleman did not mention this, but I might add that because the situation in Northern Ireland is different from that in England—by the way, the situation in Scotland is different, too—the Government need to think carefully about how the policy is applied throughout the whole United Kingdom, because VAT is a reserved matter, and about what it means for the hon. Gentleman’s constituents and others across these islands.

Mike Amesbury Portrait Mike Amesbury (Runcorn and Helsby) (Lab)
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My late mother and dad used to run a pub, and they paid their taxes. It was a private business that made a profit. Why should these businesses not pay their taxes? Why should they not pay what is owed?

Damian Hinds Portrait Damian Hinds
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This is a completely different situation. Independent schools do pay tax.

--- Later in debate ---
Mike Amesbury Portrait Mike Amesbury
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indicated dissent.

Damian Hinds Portrait Damian Hinds
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No, independent schools do pay tax on supplies. No tax is charged on education, whether in an independent school or in other settings, and that is a very long-standing principle.

Let me clear up one very important definitional point, which I ask colleagues to reflect on. There is no tax break involved. It would be a tax break if a person who had a child at an independent school and was not taking a place at a state school were charged less tax as a result. That does not happen in the United Kingdom. Everybody contributes to state sector education, whether or not they take up a place.

The principle of no tax on learning is a fast one, and once we loosen it, we do not know where we will go. Where might the Treasury look next? Private nurseries, perhaps? Music lessons? Private tutoring? What is the philosophical difference between independent school education and private tutoring?