Labour's VAT hike forces 115 private schools to close in months
Labour’s new VAT policy on private schools has led to widespread closures and financial strain for families. Since the tax was introduced, over 115 mainstream private schools have shut their doors. Critics now warn the measures could disrupt both independent and state education across the country. The policy, based on modelling by the Institute for Fiscal Studies, was expected to push around 17,000 pupils out of private education. But recent figures from the Adam Smith Institute suggest the impact has been far greater. Over 25,000 children have left private schools since last September—more than one in ten nationwide.
The Department for Education maintains the tax will generate over £1.8 billion annually by 2030. However, the original projections failed to account for broader economic consequences, including school closures. Thetford Grammar School in Norfolk, for example, has announced its shutdown, which could cost the local economy more than £2 million each year.
While ministers framed the tax as targeting the super-rich, middle-income families have been hit hardest. Private special schools, meanwhile, remain largely unaffected. Local authorities can reclaim VAT costs directly from the government, shielding them from the policy’s financial pressure. The VAT policy has already forced dozens of schools to close and displaced thousands of pupils. With more families facing higher costs, the long-term effects on both private and state education remain uncertain. The government’s revenue projections now face scrutiny as economic and social impacts become clearer.
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