The Impact of VAT on Private Education
A total of 105 independent schools have closed due to the controversial decision by the Labour government to impose a VAT charge on school fees, affecting approximately 25,000 children. This grim figure was disclosed by Julie Robinson, the leader of independent schools, on the first anniversary of the policy’s introduction on January 1 last year.
Ms. Robinson, who serves as the chief executive of the Independent Schools Council, has warned that the situation is likely to worsen in 2026. She described the ongoing efforts by the Labour government as an “ideological class war” against private education. According to her, the effects of the VAT and other tax measures are expected to lead to further closures over the coming months and years.
While multiple factors contribute to school closures, Ms. Robinson emphasized that for some institutions, the government’s decision to tax education has proven to be a critical turning point. Among the 105 schools that have closed, 15 were merged with other schools.
Even some of the most renowned schools in the country have faced financial challenges. Marlborough College, the alma mater of the Princess of Wales, has reportedly turned off its heating during the holidays to cut costs. A staff member, who chose to remain anonymous, shared this information.
The Wiltshire-based school, which was once considered a potential destination for Prince George, charges up to £61,800 per year. However, it has already discontinued its annual summer school after 50 years, citing financial pressures, including the VAT on fees.
These figures contradict the initial forecasts made by the Labour government, which claimed that no schools would close as a result of the policy. It wasn’t until March last year, after a dozen schools had shut down, that a minister acknowledged the policy would have casualties.
Treasury Minister Torsten Bell then estimated that up to 100 schools could close over three years. Initially, the government projected that only 3% of private school pupils—around 18,000 students—would leave the sector.
While many schools in the North and the Midlands have been forced to close, nearly one-fifth of the closures have occurred in London and its surrounding areas. Park Hill School in Kingston and Falcons School in Putney both cited the introduction of VAT on fees as the reason they could no longer sustain their operations.
Other notable closures include the Old Palace of John Whitgift School in Croydon, Ursuline Prep in Ilford, and London Acorn in Morden. More recent closures include The Cedars School in Croydon, an all-boys senior school that shut in September, and Oak Heights, a co-ed senior school in Hounslow, West London, which closed in October.
Other high-profile closures include Queen Margaret’s School for Girls in York, where governors stated they were unable to withstand mounting financial pressures. Carrdus School in Banbury, owned by leading girls’ school Tudor Hall, and Maidwell Hall in Northamptonshire, whose alumni include Earl Spencer, have also closed.
In December, The Meadows Montessori in Ipswich, a school catering to children aged three to 16, shut its doors. Its head, Sam Sims, attributed the closure to financial pressures, including targeted measures such as VAT on school fees.
A government spokesperson responded to these developments, stating that the so-called crisis of pupils leaving the private sector and placing pressure on the state system has not materialized. They added that ending tax breaks for private schools would generate £1.8 billion annually by 2029/30 to support public services, including aiding the 94% of children in state schools.
Ongoing Concerns and Questions
As the impact of the VAT policy continues to unfold, questions remain about the future of private education in the UK. Are private schools on the brink of a crisis with 10,500 fewer pupils this year due to Labour’s looming VAT policy? Could Labour’s VAT policy spell the end for beloved private schools like the prestigious Carrdus School facing closure amid soaring costs?
Has Labour’s new tax policy brought Britain’s prestigious private schools to their knees, causing closures and a mass exodus to the state sector? Are Labour’s new tax measures a fatal blow to Britain’s prestigious private schools, forcing cherished programs like Marlborough’s summer school to shut down? Are elite schools facing closure or drastic fee hikes due to Labour’s VAT policy on education?