Labour Abandons Pledge to End Private Schools' Charitable Status

Labour rethinks its stance

Labour leader Sir Keir Starmer has made a U-turn on a key promise to remove charitable status from private schools. While the party still plans to levy VAT on these schools, it no longer sees the need to eliminate other charity-related benefits.

Charity perks for private schools

Private schools, as charities, enjoy several advantages, including tax exemptions on profits and relief on business rates. In addition to these benefits, Labour had initially proposed removing their VAT exemption, a move that could generate significant revenue.

Labour drops the double-whammy

Shadow Education Secretary Bridget Phillipson recently called for the removal of private schools' charitable status. However, Labour sources have now confirmed that the party has abandoned this policy, believing that imposing VAT is sufficient to fund their proposed initiatives.

The cost to parents

The imposition of VAT on private schools could potentially increase parents' fees by as much as 20%. Labour estimates that this move could raise £1.7 billion per year, which it aims to invest in state schools.

Labour's series of U-turns

This reversal is the latest in a string of policy shifts made by Sir Keir since becoming leader of the Labour Party. In addition to VAT, Labour has pledged to make private schools pay business rates to further increase funding for state schools.

The impact on state schools

The funds generated from these measures are earmarked for "improving standards and opportunities for the over nine in 10 children attending state schools," according to Labour.

Gordon Brown's support

Former Prime Minister Gordon Brown has voiced his support for the policy, revealing that his government also considered it during his tenure. Brown argued that private schools should not be exempt from VAT, considering that most other goods and services are subject to this tax.