Baines Cutler

Baines Cutler provides schools with information and solutions. We carry out sector-leading surveys and provide consultancy to help schools run effectively

[Baines Cutler @BainesCutler]

12 Things you didn’t know about VAT on fees – our campaign against an ideological policy

Thanks for following us over the last 12 days. Fuller summary of points on link below. Ps RT and share widely so the truths about VAT on fees become better known.

https://t.co/hmzWU0TWwj

[Baines Cutler @BainesCutler]

1/2 Calling school Heads, Bursars and Governors. With an election less than a year away you probably think you know everything about the threat to charge VAT on school fees. But much of what has been written is factually incorrect or is based on pre-existing political views

[Baines Cutler @BainesCutler]

12/12 Ind schools give bursaries of 10%+ of fees. Most are paid for by other parents & help modest-means parents/pupils. The 1st response will be to reduce these & pull back on state outreach/partnerships – two own goals. VAT will add to elitism & the state/independent divide.

[Baines Cutler @BainesCutler]

12 Things you didn’t know about VAT on fees – our campaign against an ideological policy

Thanks for following us over the last 12 days. Fuller summary of points on link below. Ps RT and share widely so the truths about VAT on fees become better known

https://t.co/hmzWU0TWwj

[Baines Cutler @BainesCutler]

12/12 Ind schools give bursaries of 10%+ of fees. Most are paid for by other parents & help modest-means parents/pupils. The 1st response will be to reduce these & pull back on state outreach/partnerships – two own goals. VAT will add to elitism & the state/independent divide.

[Baines Cutler @BainesCutler]

11/12 VAT on fees will hurt the international competitiveness of UK education - a major area of soft influence. In virtually all other countries nonprofit education does not attract VAT. Its a tax on the UK international brand/offer & international students will go elsewhere

[Baines Cutler @BainesCutler]

10/12 Why have independent schools been singled out? Universities are private but no one is suggesting tuition VAT. And wont parents move or pay private tutors to help get into a top state school? Its easy to feel that VAT on fees is based on more on prejudice than economics

[Baines Cutler @BainesCutler]

9/12 IFS say that VAT lost from pupils going will be fully earned back by spending on other things ignoring that the major things often foregone ie houses and o/s holidays are non-vatable. Also parents might save up the money for university fees or housing gifts again non-vatable

[Baines Cutler @BainesCutler]

8/12 Labour/IFS ignore the extra cost to state education “only 5% pupil drop off so absorbed in existing budget”. With a 20% tax hike it’s completely counterintuitive, and no support evidence is given. With no new money, ALL state children will be poorer as less spent on each

[Baines Cutler @BainesCutler]

7/12 If all parents at a rich school afford VAT, amazingly MORE taxpayer money will go to it as it will pass the parent VAT to HMRC but then receive back input VAT which it cant now. So Labour will be giving extra taxpayer cash to the richest schools - has anyone realised this?

[Baines Cutler @BainesCutler]

6/12 VAT rules favour richer schools at the expense of poorer ones. Rich schools build more, will be able to reclaim input VAT & so will have a lower effective VAT rate. Poorer schools build less & will have a higher effective rate. VAT on fees hurts the less well-off school more

[Baines Cutler @BainesCutler]

5/12 Many have missed that VAT will impact schools & parents disproportionately. Wealthy schools might be able to absorb some VAT but schools of modest means wont. Richer parents might be able to afford VAT but modest-means parents wont. The policy is highly regressive

[Baines Cutler @BainesCutler]

4/12 Dropoff estimates are often just gossip ie if individual families will leave. Many will try hard to keep their kids in. The real issue is replacement - would an equivalent family start after VAT? This is much less likely & non-replacement is key to long-term dropoff calcs