Research highlights potential impact of VAT being applied to school fees
The Labour Party has pledged that if elected at the General Election, it would apply VAT to school fees, which could see parents paying up to 20% more. New research with headteachers, bursars and finance managers at fee-paying private schools in the UK reveals 91% believe that 10% or more of their pupils would be at risk of leaving their school if VAT is applied to fees because their parents would not be able to afford to pay them. Some 35% believe between 15% and 30% could be at risk of leaving according to Premium Credit.
- Many private schools would look to cover some of the increase from VAT being applied to school fees, which the Labour Party says it would do if elected to government
Percentage of the VAT applied to private school fees that would be passed on to parents | Percentage of headteachers, bursars and finance managers at private schools that said their school would pass this amount of the VAT applied to school fees on to parents |
All of the VAT applied (20%) | 10% |
Between 75% and 99% of the VAT applied | 12% |
Between 50% and 75% of the VAT applied | 26% |
Between 25% and 50% of the VAT applied | 43% |
Between 10% and 25% of the VAT applied | 8% |
Up to 10% of the VAT applied | 1% |
Read related articles
- UK 'most expensive' for employing expat staff
- Ten lessons for British schools expanding internationally
- New Schools Index ranks 125 best schools in the world
However, Premium Credit’s study reveals that in not passing on the full VAT increase to parents in higher fees and taking some of the financial hit from this themselves, many schools would look to make cutbacks as a result. Two thirds of private school headteachers, bursars and finance managers interviewed said they would look to reduce headcount at their school and use the money saved to reduce the impact of VAT on school fees, and one in two (50%) said they would invest less in the infrastructure of the school.
Action taken to reduce the impact of VAT being applied to school fees | Percentage of headteachers, bursars and finance managers at private schools that said their school would do this to save money and reduce the impact of VAT being applied to school fees on parents |
Reduce headcount/recruitment | 66% |
Cut back on investing in the infrastructure of the school | 50% |
Reduce salary increases | 44% |
Reduce expenditure on school equipment | 21% |
Read the latest issue of Think Global People magazine. Read your copy here.
Find out more about the Think Global People and Think Women community and events.
Subscribe to Relocate Extra, our monthly newsletter, to get all the latest international assignments and global mobility news.Relocate’s new Global Mobility Toolkit provides free information, practical advice and support for HR, global mobility managers and global teams operating overseas.
©2024 Re:locate magazine, published by Profile Locations, Spray Hill, Hastings Road, Lamberhurst, Kent TN3 8JB. All rights reserved. This publication (or any part thereof) may not be reproduced in any form without the prior written permission of Profile Locations. Profile Locations accepts no liability for the accuracy of the contents or any opinions expressed herein.