Asked by: Neil O'Brien (Conservative - Harborough, Oadby and Wigston)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what estimate her Department has made of the number of transactions that will take place (a) up to £125,000, (b) from £125,001 to £250,000, (c) from £250,001 to £925,000, (d) from £925,001 to £1.5 million and (e) above £1.5 million in its forecast of residential Stamp Duty Land Tax receipts in the 2029-30 financial year.
Answered by Dan Tomlinson - Exchequer Secretary (HM Treasury)
A split of forecast property transactions by price band is not available.
However, a forecast of overall property transactions from the Office for Budgetary Responsibility is available here: https://obr.uk/forecasts-in-depth/the-economy-forecast/housing-market/#transactions.
Asked by: Neil O'Brien (Conservative - Harborough, Oadby and Wigston)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what estimate her Department has made of the potential impact of the increase in employer National Insurance contributions on receipts to the Exchequer from the charity and voluntary sector.
Answered by Dan Tomlinson - Exchequer Secretary (HM Treasury)
The Government recognises the important role charities play in our society and has made it a priority to reset the relationship with civil society by developing a Civil Society Covenant.
A Tax Information and Impact Note (TIIN) was published alongside the introduction of the Bill containing the changes to employer National Insurance contributions. The TIIN sets out the impact of the policy on the exchequer, the economic impacts of the policy, and the impacts on individuals, businesses, civil society organisations, as well as an overview of the equality impacts.
The Office for Budget Responsibility also published the Economic and Fiscal Outlook (EFO), which sets out a detailed forecast of the economy and public finances.
Asked by: Neil O'Brien (Conservative - Harborough, Oadby and Wigston)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, on what projects her Department plans to spend the revenue raised from VAT on independent school fees in the (a) 2024-25 and (b) 2025-26 financial years; and how much she plans to allocate to each project.
Answered by James Murray - Chief Secretary to the Treasury
The Government has taken a number of decisions on tax to stabilise the public finances and support public services. Ending tax breaks for private schools will raise £1.8bn a year.
To raise school standards for every child, and break down the barriers to opportunity, the government will increase the core schools budget by £2.0bn in real terms over this Spending Review (2023-24 to 2028-29). This provides a £4.7bn cash increase per year by 2028-29 (compared to 2025-26), which ensures average real terms growth of 1.1% a year per pupil.
Asked by: Neil O'Brien (Conservative - Harborough, Oadby and Wigston)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, how many staff in (a) her Department and (b) HMRC have job titles that include the words (i) equality, (ii) diversity, (iii) inclusion, (iv) gender, (v) LGBT and (vi) race.
Answered by James Murray - Chief Secretary to the Treasury
HM Treasury has a headcount of 2 staff who have (i) equality, (ii) diversity, (iii) inclusion, (iv) gender, (v) LGBT or (vi) race in their job title.
HMRC has a headcount of 12 staff who have (i) equality, (ii) diversity, (iii) inclusion, (iv) gender, (v) LGBT and (vi) race in their job title
Asked by: Neil O'Brien (Conservative - Harborough, Oadby and Wigston)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, how private schools who were not previously VAT-registered but did produce taxable supplies that were under the registration threshold will be treated under the new VAT guidance.
Answered by James Murray - Chief Secretary to the Treasury
A private school, or any other business, making taxable supplies under the threshold has no requirement to register for VAT. Once the value of taxable supplies made exceeds the VAT registration threshold, which currently stands at £90,000, they must register for VAT.
On 1 January 2025 supplies of education by private schools become subject to VAT at the standard rate of 20%. These fees must be included with the value of all other taxable supplies in calculating taxable turnover.
If the taxable turnover of a private school now exceeds the threshold, either due to supplies of education alone or a mix of education with other taxable supplies, they must register for VAT. This requirement extends to any person over the threshold and to taxable supplies of any nature.
The change in legislation and new guidance applies only to supplies of education by a private school and does not affect other taxable supplies.
Asked by: Neil O'Brien (Conservative - Harborough, Oadby and Wigston)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, for what reason the publication of new VAT guidance in October 2024 was following the Budget.
Answered by James Murray - Chief Secretary to the Treasury
Since 1 January 2025, all education services and vocational training provided by private schools in the UK for a charge have been subject to VAT at the standard rate of 20 per cent.
Since the announcement of this policy, HMRC has taken action to support private schools through the change.
On 10 October 2024, HMRC published bespoke guidance for private schools, which can be found here: Registering for VAT and Charging and Reclaiming VAT. HMRC published initial guidance ahead of the Budget to maximise the amount of time private schools had to prepare for this policy taking effect. This guidance was updated on 30 October 2024 to reflect the final policy design. Details of guidance updates are available on GOV.UK.
As with all guidance, HMRC is keeping the guidance for private schools under review. HMRC continues to engage with private schools and the organisations that represent them.
Asked by: Neil O'Brien (Conservative - Harborough, Oadby and Wigston)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether independent schools under the new interpretation of VAT entities following the Autumn Budget 2024 are their own class of business.
Answered by James Murray - Chief Secretary to the Treasury
Taxpayers who are required to register for VAT can usually do so online.
The ‘Business activity’ section of the VAT registration form requires a full description of all the taxpayer’s business activities, including the type of goods and/or services that they supply. HMRC guidance is for private schools to enter ‘Private Education Provider’ in this section.
When registering for VAT, taxpayers are also required to provide Standard Industry Classification (SIC) codes that best describe their business activities. These will depend on their individual circumstances.
Asked by: Neil O'Brien (Conservative - Harborough, Oadby and Wigston)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether the new VAT legislation for private schools led to HMRC amending or redefining the scope of input tax recovery for business who made exempt supplies prior to registration.
Answered by James Murray - Chief Secretary to the Treasury
VAT incurred prior to registration is not input tax. However, HMRC has discretion under the provisions of Regulation 111 of the VAT Regulations 1995 (SI 1995/2518) to allow such VAT to be treated as input tax, subject to the normal rules. There was therefore no need to amend or redefine the scope of input tax recovery following the introduction of VAT on private school fees.
Asked by: Neil O'Brien (Conservative - Harborough, Oadby and Wigston)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment she has made of the compatibility of changes to VAT legislation with the principal of fiscal neutrality.
Answered by James Murray - Chief Secretary to the Treasury
Fiscal neutrality is a key feature of the VAT system, and helps to ensure market distortions are minimised by equalising the tax treatment of supplies which are identical or sufficiently similar from the point of view of the consumer.
When changing VAT legislation the Government considers issues of fiscal neutrality as part of the policy making process.
Asked by: Neil O'Brien (Conservative - Harborough, Oadby and Wigston)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, with reference to the comments of the Chief Secretary to the Treasury on Newsnight on 29 July 2024, what the evidential basis is for the claim that the Government Communication Service spent hundreds of millions of pounds on filming content for Conservative ministers’ social media channels.
Answered by Darren Jones - Minister for Intergovernmental Relations
The government has taken decisive action to reduce wasteful spend, In Fixing the Foundations, the Chancellor identified £100m of savings from non-essential spending on government communications across 2024-25 and 2025-26.
Cabinet Office provided estimates of comms spending during the Public Spending Audit, announced by the Chancellor of the Exchequer in July 2024. Estimates were based on internal Government Communication Service data on campaigns planned by Departments and arm's length bodies at the time of commissioning. These indicate that UK Government was expected to spend £449m on communications campaigns during 24/25. This includes communications considered operationally critical, for example, required to fulfil a statutory duty, life-saving, or required for the efficient functioning of a public service. At Autumn Budget 2024, the Chancellor announced that the Government Communications Service is expecting to save £50m in 2024-25 and £85 million from reducing unnecessary communications spend in 2025-26 – exceeding the £100 million target set out in July.