Question to the HM Treasury:

To ask the Chancellor of the Exchequer, whether she has made a comparative assessment of the potential merits of introducing VAT on private schools (a) during the academic year and (b) at the start of the new academic year.

On 29 July, the Government announced that, as of 1 January 2025, all education services and vocational training provided by a private school in the UK for a charge will be subject to VAT at the standard rate of 20 per cent. This will also apply to boarding services provided by private schools. Any fees paid from 29 July 2024 relating to the term starting in January 2025 onwards will be subject to VAT.

A start date of January 2025 will have given schools and parents 5 months to prepare for the changes, and it is right that we introduce these changes as soon as possible in order to raise the funding needed to help deliver our education priorities.

The Government has carefully considered the impact that these changes will have on pupils and their families across both the state and private sector, as well as the impact they will have on state and private schools. Following scrutiny of the Government’s costing by the independent Office for Budget Responsibility, the Government will confirm its approach to these reforms at the Budget on 30 October, and set out its assessment of the expected impacts of these policy changes in the normal way.

The Government recognises that some pupils may subsequently move into the state education sector. However, the number of pupils who may switch schools as a result of these changes represents a very small proportion of overall pupil numbers in the state sector.

The Government is confident that the state sector will be able to accommodate any additional pupils and that these policies will not have a significant impact on the state education system as a whole.