The Labour Party has abandoned plans to take charitable status away from private schools but still intends to remove some tax breaks.
The party had pledged in 2021 that if it came into government it would remove charitable status from independent schools and reinvest the money gained from the tax breaks they would lose into the state education system.
But Labour has indicated today that it would instead change tax rules to make the schools pay VAT and end the 80 per cent business rate relief they are entitled to.
A Labour Party spokesperson said: “Our policy remains. We will remove the unfair tax breaks that private schools benefit from, to fund desperately needed teachers and mental-health counselling in every secondary school.
“This doesn’t require removing charitable status; however, driving high and rising standards for every child against the backdrop of a broken economy requires political choices. Labour isn’t afraid to make them.”
Sir Keir Starmer told the Political Thinking podcast that Labour’s decision to charge private schools 20 per cent VAT and end business rates relief was not an “attack on private schools”.
He said: “We have to do something about the appalling state of our schools.
“I’m very comfortable with private schools but I want our state schools to be just as good, so it doesn’t matter whether you send your child to private school or to state school because you’ll get equal chances in life.”
This policy update is being touted as a U-turn by the Conservative Party because it contradicts comments made in 2021 by Rachel Reeves, the shadow chancellor, who said: “Private schools are not charities. We will end that exemption and put that money straight into our state schools.”