The Labour Government launched a formal consultation on 29 July 2025 for their plans to add VAT to independent school fees and add business rates to independent schools.
The Education Not Taxation campaign wrote to the Office for Budget Responsibility, urging them to undertake a thorough, independent review of this plan. We described several significant flaws in the Institute for Fiscal Studies report that underpins this policy, and why this matters.
You can find our letter to the OBR here. We’ve also written a short 2-page summary explaining the key points, and you can find that here. The Adam Smith Institute have also published detailed analysis that shows the harms this policy can have–not only to children taxed out of their schools, but also on the wider economy. Contrary to Labour’s rosy estimates of around £1.5bn from taxing Education, the Adam Smith Institute estimate that this policy could raise just £0.84bn if 5% of children leave, break even if 10% leave, and cost the Treasury £2.51bn if 25% leave. You can find their analysis in the paper Short-Term Thinking: Analysing the Effects of Applying VAT to School Fees. They wrote a follow-up paper called Tuition Tensions: Labour Markets and Education Taxes.
Education Not Taxation 