Why parents should be concerned about the UK’s VAT tax on private schools

Now that freedom is currently under attack as the UK government has added a 20 percent VAT (Value Added Tax) on private school fees. The UK government’s decision is a significant departure from the consensus on the protection of fundamental rights and sets a potentially dangerous precedent for Europe. The tax has been in effect since January 2025.

Stated in Article 26 of the Universal Declaration of Human Rights, this provision enshrined one of the fundamental pillars of educational pluralism as a human right. Subsequently reflected in legally binding instruments, international human rights treaties and numerous national constitutions, educational pluralism has not only been recognised and protected by most countries but has also been actively promoted through policies involving public funding.

In response, the organisation I represent (OIDEL) sought to intervene in the proceedings before the UK Supreme Court to highlight the implications of this policy for the right to education and freedom of education.

A human right

The recognition of educational pluralism as a human right remains crucial for parents and the affected schools themselves. Educational pluralism, at its heart, involves the parents’ right to choose their children’s schools and individuals’ right to run and direct alternative educational institutions outside the state system. Recognising these freedoms as human rights links them directly to human dignity and entails corresponding obligations for public authorities. These seem to be ignored by the UK government at this time.

In many countries, fulfilling these obligations means providing financial support to non-governmental educational institutions so that families can choose their children’s schools regardless of their financial circumstances.

In the UK, however, the VAT measure does not merely fail to provide such support; it also makes access to non-governmental schools much more difficult for families with limited financial resources. There are many reasons why parents may want to choose an alternative to the offer from the state.

These include provisions for special or additional needs, or a provision for more of a faith- based education than the state may be able to provide. It may be because local state schools are of low-quality, or even have a culture which the parents find unacceptable for their children.

The international consensus towards recognising educational pluralism as a human right helps explain why private education has been exempted from VAT across Europe, including in the UK, since at least the 1960s. This approach was justified on the grounds that education, regardless of who provides it, is an activity of public interest and a public good.

This justification pointed to two interconnected ways in which private educational institutions serve the public interest. First, they contribute directly to the provision of education. Second, they ensure the diversity of educational provision that is essential to safeguarding the educational pluralism recognised in international human rights instruments. It is interesting to note that a European Union directive from the 1970s explicitly incorporated this pre-existing consensus into European law. Education was included among the activities exempted from VAT, alongside other services considered to be of public interest, regardless of the identity of the provider.

The main objectives of the provision were to prevent price increases in an activity considered to be in public interest, which would otherwise make it less accessible to those entitled to benefit from it. Secondly, maintaining education as free of taxation was to prevent distortions of competition between public and private providers.

Both the Court of Justice of the European Union and the European Commission have emphasised that this protection reflects the principle that non-governmental schools should not be treated as commercial outsiders to a system reserved exclusively for state providers, but rather as an essential part of the educational system itself.

An outlier

By introducing VAT on private school fees, the UK joined New Zealand as the second Western country imposing this tax on non-governmental schools, making it an outlier in the European context. It is not unreasonable to regard this initiative as another worrying step in the erosion of the human rights framework in the region.

Furthermore, this measure could create difficulties for the UK should it seek to rejoin the European Union as a full member. Such difficulties could only be resolved through a change to the relevant EU legislation or by removing VAT from private educational institutions’ fees. The question must be asked, could it be possible that the UK becomes a leader within Europe, and that EU itself could be persuaded to take on a similar policy?

The UK has historically been at the forefront of defending rights and freedoms, and freedom of education has not been an exception. Educational pluralism is also deeply rooted in the British intellectual tradition. The words of Stuart Mill resonate strongly in this context: “It is not endurable that a government should, either de jure or de facto, have a complete control over the education of the people.”

Today, the UK risks bringing Mill’s fears of egregious state control closer to reality. We can only hope that the Supreme Court will reverse this course and reaffirm the importance of educational pluralism as an essential component of the right to education and of a free and democratic society.