THE head master of one of Salisbury's private schools has said it will "have to do more with less" as a result of Labour's new VAT policy. 

Chancellor Rachel Reeves confirmed earlier this week that Labour will be introducing VAT at the standard rate of 20 per cent to private school fees from January 1, 2025.

Mr Simon Head, who has been head master at Chafyn Grove School on Bourne Avenue since 2016, also moved to reassure parents that the school has made every effort to ensure that this  does not affect the children in its care. 

(Image: Contributed)

He said: "The long-term performance of Chafyn Grove will be unaffected, but other schools in the independent sector will close – to the detriment of those children and communities."

The government has also cracked down on parents trying to avoid the extra tax by paying fees in advance.

It said the tax would apply to all payments for the January term made from 29 July 2024 onwards.

At the moment, private schools do not have to charge VAT on their fees because of a legal exemption for organisations providing education.

About half of England's private schools are also charities, so receive an 80% reduction on business rates (taxes on properties used for commercial purposes).

Labour believes this will generate an extra £1.3-1.5billion, after taking into account the estimated cost of accommodating children who might switch from private to state education as a result of the changes.

That could allow a two per cent increase in state school spending in England.

Mr Head added: "The majority of independent schools – like any business – operate to strict margins. An effective reduction in income of at least 15 per cent is serious – particularly now that it has been brought forward to January.

"Chafyn Grove has prepared for this challenging eventuality in every way possible, including increasing its fees by as low amount as possible and making savings that affect the provision for the children as little as possible".

He said that the most significant impact "has been visited upon the staff".

He said: "These are hard-working people who have lost personal income as a direct result of the government making this change. Just as our parents do not deserve to be labelled as ‘fat cats’ who can simply pay more, the teachers and support staff affected do not deserve to have their livelihoods harmed in this way.

"None of Salisbury’s independent schools are bastions of privilege or drivers of inequity; they – like their state-school counterparts – are devoted to looking after children and enabling them to develop happily and purposefully. It is entirely right for the government to seek to improve teacher numbers in the maintained sector, but to do so by damaging one part of the educational ecosystem for minimal gain in another is not the best way."