VAT on private school fees drives enrolment drop and closures in Scotland

In January of the previous year the UK Labour Government extended value-added tax to private-school tuition across the United Kingdom, a move that lifted fees by roughly 22 percent. In Scotland the surcharge has triggered a 22 percent reduction in independent-school enrolments and forced the closure of five institutions, among them Fernhill School in Rutherglen and Drumduan School near Forres, which was co-founded by actress Tilda Swinton.

Drumduan’s trustees reported an immediate 24 percent fall in its roll, attributing the decline to the tax and to cumulative pressures from Brexit, the pandemic, rising energy and staff costs, and the removal of business-rates relief. Scottish Conservative education spokeswoman Meghan Gallacher called on Holyrood’s education committee to launch an inquiry into the impact on both private and state schools. The Scottish Council of Independent Schools warned that the VAT policy could cost the Scottish taxpayer £16 million this year and rise to £200 million a year within ten years, while also highlighting the sector’s £700 million contribution to the Scottish economy. The council urged the Scottish Government to partner with independent schools to maximise their expertise and international draw.