Bye Bye Sunak..

[ZedLeg]

I’ve been enjoying this argument on PH tbh

A lot of people refuse to see their own privilege, it’s the same with the 60% tax thing. If your kids are at private school and you’re finding yourself having to deal with this tax quirk, you’re a mile away from “the squeezed middle”.

[dinny_g]

It is the corollary of what you’re saying though. If you want to run an alternative to the state school system, why is it fair to get a tax break? A private school is just a business.

My point wasn’t directly about schools - it was about levying additional taxes on “the rich” in the firm belief that they can and will just pay them because “they’re rich”

[Jobbo]

It is the corollary of what you’re saying though. If you want to run an alternative to the state school system, why is it fair to get a tax break? A private school is just a business.

My point wasn’t directly about schools - it was about levying additional taxes on “the rich” in the firm belief that they can and will just pay them because “they’re rich”

It’s not additional taxes on the rich, it’s creating a level playing field for businesses. The market sets the price paid by parents.

[Jobbo]

I’ve been enjoying this argument on PH tbh

A lot of people refuse to see their own privilege, it’s the same with the 60% tax thing. If your kids are at private school and you’re finding yourself having to deal with this tax quirk, you’re a mile away from “the squeezed middle”.

I’ve seen your posts on PH and laughed at the responses. Lack of self-awareness.

The thing is, if you are taxed at 60% there’s reduced incentive to earn more. I have effectively been self-employed for a few years and I deliberately limit how much I pay myself to avoid paying what I consider an unfair tax rate. No ‘woe is me’ here, but if the rate remained consistent then I’d pay myself more and thus pay more tax, benefiting the country as a whole. So it’s a bit short-sighted to say it’s simply rich people complaining.

[ZedLeg]

I agree tbh and the 60% effective tax rate thing should be tightened up as it’s not fair. My point was that if it effects you, you’re already way past the middle.

However on the school front my opinion is still that private schools are a luxury service and should be vatable.

[Rich B]

I’ve been enjoying this argument on PH tbh

A lot of people refuse to see their own privilege, it’s the same with the 60% tax thing. If your kids are at private school and you’re finding yourself having to deal with this tax quirk, you’re a mile away from “the squeezed middle”.

I’ve seen your posts on PH and laughed at the responses. Lack of self-awareness.

The thing is, if you are taxed at 60% there’s reduced incentive to earn more. I have effectively been self-employed for a few years and I deliberately limit how much I pay myself to avoid paying what I consider an unfair tax rate. No ‘woe is me’ here, but if the rate remained consistent then I’d pay myself more and thus pay more tax, benefiting the country as a whole. So it’s a bit short-sighted to say it’s simply rich people complaining.

the 60% bit is only from £100-125k though where it just wipes out your personal allowance. So even though it's daft, it doesn't affect the earnings after that - they're back to being 40% again. You always take home more by earning more.

[Jobbo]

I’ve been enjoying this argument on PH tbh

A lot of people refuse to see their own privilege, it’s the same with the 60% tax thing. If your kids are at private school and you’re finding yourself having to deal with this tax quirk, you’re a mile away from “the squeezed middle”.

I’ve seen your posts on PH and laughed at the responses. Lack of self-awareness.

The thing is, if you are taxed at 60% there’s reduced incentive to earn more. I have effectively been self-employed for a few years and I deliberately limit how much I pay myself to avoid paying what I consider an unfair tax rate. No ‘woe is me’ here, but if the rate remained consistent then I’d pay myself more and thus pay more tax, benefiting the country as a whole. So it’s a bit short-sighted to say it’s simply rich people complaining.

the 60% bit is only from £100-125k though where it just wipes out your personal allowance. So even though it's daft, it doesn't affect the earnings after that - they're back to being 40% again. You always take home more by earning more.

Yes, you take home 40% more of your total earnings. I think that is a bad deal and choose not to take it. If the tax rate was 99% you’d also take home more by earning more but nobody would bother earning more; they’d have more time off or whatever. The rate does go to 45% afterwards anyway, not simply back to a straight 40%, but that’s still more than half of what you earn going to you not the government.

There are other marginal rates which are far worse than 60%, where you earn just enough to lose child benefit for instance. The tax system is over-complicated and by creating these sort of situations it almost certainly raises less money than it could by disincentivising people from earning more.

[Rich B]

I’ve seen your posts on PH and laughed at the responses. Lack of self-awareness.

The thing is, if you are taxed at 60% there’s reduced incentive to earn more. I have effectively been self-employed for a few years and I deliberately limit how much I pay myself to avoid paying what I consider an unfair tax rate. No ‘woe is me’ here, but if the rate remained consistent then I’d pay myself more and thus pay more tax, benefiting the country as a whole. So it’s a bit short-sighted to say it’s simply rich people complaining.

the 60% bit is only from £100-125k though where it just wipes out your personal allowance. So even though it's daft, it doesn't affect the earnings after that - they're back to being 40% again. You always take home more by earning more.

Yes, you take home 40% more of your total earnings. I think that is a bad deal and choose not to take it. If the tax rate was 99% you’d also take home more by earning more but nobody would bother earning more; they’d have more time off or whatever. The rate does go to 45% afterwards anyway, not simply back to a straight 40%, but that’s still more than half of what you earn going to you not the government.

There are other marginal rates which are far worse than 60%, where you earn just enough to lose child benefit for instance. The tax system is over-complicated and by creating these sort of situations it almost certainly raises less money than it could by disincentivising people from earning more.

yep, nice if you can choose not to go PAYE and be more efficient with your earnings. I don't have the choice so I'll happily earn as much as I can - half of something is still good, even though I know how wealthy I make the tax man.

[Jimexpl]

If the extra 20% costs you £25k extra a year, then you're not going to get a huge amount of sympathy as you can happily afford the other £100k.

Not saying you’re Left Rich but this is the fallacy of the left.

Just because you can afford £100k for schooling, doesn’t mean you can easily afford another £25.

The belief that “the rich”

a. have endless supplies of money that can be taxed
b. wont make decisions (by choice or by necessity) that will reduce or eliminate the tax increase

Free market economics does not mean favouring particular business sectors. That’s not a left wing view; I’d say it’s a right wing view. It’s not as if Rich is suggesting banning private schools.

There’s a big part of the picture missing if you group all private schools into the same category. Parents sending kids to £9-15k pa schools are generally in a completely different wealth category to those with £25k+ pa fees.
We’re fortunate enough to (just about) manage to keep our kids in the former, but I’d say there’s been about 5% of kids leave in the last 18 months for state schools (due to financial pressures). Teachers in the school can’t remember this happening in the last 20 years. It’s a small school and adding vat on will probably shut it down.

Does the state system have capacity for an extra 5% feed in from the private sector let alone 30%?
I’d happily send my kids to state school, but in our postcode you won’t get into a decent one unless you can see it from your living room window.

[ZedLeg]

Does the state system have capacity for an extra 5% feed in from the private sector let alone 30%?
I’d happily send my kids to state school, but in our postcode you won’t get into a decent one unless you can see it from your living room window.

All the kids in private school in England make up 0.5% of all kids between 6 and 19. The entire private school population would be covered by the average absentee rate in state schools.

[Rich B]

Does the state system have capacity for an extra 5% feed in from the private sector let alone 30%?
I’d happily send my kids to state school, but in our postcode you won’t get into a decent one unless you can see it from your living room window.

All the kids in private school in England make up 0.5% of all kids between 6 and 19. The entire private school population would be covered by the average absentee rate in state schools.

are you sure?

[ZedLeg]

Just googled numbers but it's apparently around 600k in private schools and 12mil people at around school age. State school absence rate is around 6.5%.

[dinny_g]

Schools aren't like Airlines - you can't oversubscribe on the assumption that not every kid will show up every day...

[V8Granite]

We luckily live next to 3 very good primary schools and have a choice of 2 successful secondary schools. This is why our cheap house is actually double the price of ones further away.

It’s not like people only choose private schools due to a possible educational benefit, it can actually be a sensible financial move aswell.

I pay 50% tax on everything so don’t really understand how the U.K. system has changed but I remember even guys at work in the early 2000s refusing any overtime once they hit 35k or something and went into 40%.

Dave!

[Rich B]

Just googled numbers but it's apparently around 600k in private schools and 12mil people at around school age. State school absence rate is around 6.5%.

How does that relate to your 0.5% figure?

[Swervin_Mervin]

Does the state system have capacity for an extra 5% feed in from the private sector let alone 30%?
I’d happily send my kids to state school, but in our postcode you won’t get into a decent one unless you can see it from your living room window.

All the kids in private school in England make up 0.5% of all kids between 6 and 19. The entire private school population would be covered by the average absentee rate in state schools.

Yeah that's not going to work is it - you can't oversell places like seats on a plane. Our local primary is fully subscribed and they've gone from 1 form entry, to 1.5 form entry in the last few years. They've just this summer finsihed another extension to go to 2 form entry and are still fully subscribed. Kids are sitting in school corridors it's that rammed. They certainly won't have room for (conservatively speaking) even a quarter of the kids from the local prep where my son goes.

And as others have said, the bigger issue here is not the Eton-type schools with the ultra wealthy, it will be the small private schools, a lot of which will be religious schools catering for the Jewish, Muslim etc., and will be attended by kids from families that are certainly in the squeezed middle.

It is just politics of envy and I don't think Lab would actually go ahead with it, either for purely political reasons (imo they're just trotting out the old bullshit to appeal to their hardcore voters) or for legal reasons (plenty of rumour that it's against retained EU law on the provision of educational services being exempt from VAT). It wouldn't take long for someone with enough ££ to take them to court over it either, would it?

[ZedLeg]

What would they take them to court for?

I don't see it as politics of envy tbh (I don't believe in that as a concept personally). As I said earlier, to me private schools are luxury services and should be taxed as such.

[Holley]

What would they take them to court for?

I don't see it as politics of envy tbh (I don't believe in that as a concept personally). As I said earlier, to me private schools are luxury services and should be taxed as such.

Define luxury services? Should private health care be taxed similarly because the NHS is free (ish)?

For us we put our daughter in private school not because it's a luxurious thing to do, but because it was the only school that could cater for her learning. We'd have been very happy for her to go state instead.

[ZedLeg]

You make a good point Holley and there’s obviously other aspects of this to be discussed.

I’m not even that bothered about this happening if I’m being honest. I just though it was odd how many people don’t see sending their kids to private school over the local secondary is a luxury.

[GG.]

You make a good point Holley and there’s obviously other aspects of this to be discussed.

I’m not even that bothered about this happening if I’m being honest. I just though it was odd how many people don’t see sending their kids to private school over the local secondary is a luxury.

VAT hasn't been a just tax on luxury goods since 1940s/50s so the whole premise of your argument is not really relevant here.

How do you then distinguish between primary / secondary and tertiary education. Would you add VAT to university fees and if not why not. Even if you fall back on your argument that luxuries should be VATable then why wouldn't Oxford or Cambridge be subject to VAT. Trust me the quality and structuring of the tutoring there (often 1 on 2 tution versus seminars with 30 students) is certainly in a different league to most other universities and affords people a leg up in the same way as good private secondary schools.

Any increase or additional tax that is done when the tax raised is minimal or at serious risk of being tax negative and/or generating a huge administrative headache (e.g. overflowing state schools needing to take up the slack) plus being disproportionate on some of those in which it is levied (as no assessment of family income in this) is by definition a policy of envy / political partisanship, irrespective of whether you don't believe in the concept.

You also need to view this in the context that private schools have been bending over backwards for years to bolster their claim to charitable status - e.g. letting state schools share the facilities, etc. Once you take that away there will be no incentive to do any of that.