Private schools lose legal challenge over VAT changes

A legal challenge by a group of private schools over the government's decision to remove the VAT exemption on the fees they charge has been dismissed by the Court of Appeal.

Lawyers representing the families of low-paying faith schools had argued that the policy was discriminatory and in breach of human rights law - but the court rejected this and said home schooling was an option if they did not want to accept state provision.

The schools are now hoping to apply for permission to appeal to the Supreme Court.

The policy came into effect on 1 January 2025 and the government has said it would raise £1.8bn a year by 2029/30 which would help pay for more teachers at state schools in England.

Last year, three separate claims were brought in the High Court against the government from families with children with special educational needs and disabilities (SEND), those attending same-sex schools, and low-paying faith schools.

While the court did acknowledge the negative impact on some groups, including children with SEND and who attend faith schools, it said this was outweighed by the money raised for state sector schools.

The schools and families who were part of the low-paying faith schools group appealed the decision.

But the Court of Appeal dismissed the challenge on Friday.

In their judgement, Sir Geoffrey Vos, Lord Justice Singh and Lady Justice Falk acknowledged that the measure may have "a serious impact" if the families were unable to afford private education which accords with their religious convictions.

"But it is important to bear in mind that they have the option of home schooling if free education in the state sector is not acceptable to them," they added.

Government lawyers had argued that families who wished to opt out of state-funded education were free to send their children to private school or to educate them at home.

Speaking to the BBC prior to the judgement, Caroline Santer, the head teacher of a small private school in Hampshire, said: "It's important for my parents to see that I'm prepared to take a stand and fight. No other country taxes education in this way."

Chief executive of the Christian Legal Centre, Andrea Williams, said the group would keep going in the courts.

"Not everyone can home educate," Williams said.

A government spokesperson said they welcomed the ruling.

"Ending tax breaks for private schools will raise £1.8bn a year by 2029/30 to help fund public services, including supporting the 94% of children in state schools to achieve and thrive", they added.