Labour VAT raid forces latest private school closure

A private school in Ipswich has become the latest victim of Labour’s VAT raid.

The Meadows Montessori School wrote to the parents of its 68 pupils this week to tell them of its “shock” closure at the end of the term, citing rising costs and falling pupil numbers.

The co-ed school, which was forced to pass the 20pc levy on in full, said the raid had had a “significant impact” on enrolment numbers which meant the decision to close had become “unavoidable”.

In a letter to parents, headmistress Sam Sims wrote: “I know this news will bring shock, sadness, and uncertainty. Please know that we share these feelings and understand them deeply.

“Our priority now is to support every child, every family, and every member of staff through this transition with care, compassion and clarity.”

Ms Sims had previously warned that Labour’s education tax was misguided and would serve only to harm smaller independent schools rather than historic, wealthy institutions.

‘Dirt on someone’s shoe’

She described findings by this newspaper that Eton College stood to recover at least £4.8m in historic VAT on capital expenditure as “outrageous”.

She told The Telegraph: “How does that even stand? I feel like we are a little bit of dirt on someone’s shoe. There is no thought process from anyone in government about schools who are not at the level [of Eton].”

The closure of The Meadows Montessori comes as another small independent school battles to stay open.

Hunter Hall School in Cumbria launched an “emergency appeal” saying it had until next Dec 3 to raise £180,000 and stop it becoming the “next victim” of the Government’s VAT raid.

The Penrith school was similarly forced to raise fees by 20pc. Paul Borrows, the headmaster, said the VAT levy as well as the loss of business rates relief and increase in National Insurance contributions had been “huge”.

However parents and former pupils have so far raised more than £100,000, raising hopes the school, which is due to celebrate its 40th anniversary next year, will not be forced to close at the end of the term.

‘Vindictive policies’

Saqib Bhatti, the shadow education minister, told The Telegraph: “Once again we see Bridget Phillipson’s vindictive policies forcing another school into closure.

“As we have always warned, the introduction of taxation on education would hurt the smallest schools. These are the very schools that play a vital role in their communities.

“Labour should hang their head in shame as they hurt our children’s futures. The Conservatives will fight them every step of the way.”

More than 50 private schools have so far closed blaming the VAT raid for their decision, with government figures showing a further 200 are expected to close in the next three years.

In spite of this, Rachel Reeves used her Budget this week to praise the impact of Labour’s private school tax describing it as a “fair decision” to “sustainably raise further revenue from sources of wealth”.

The Budget also revealed that the Treasury expects to raise an additional £40m a year from the VAT levy because schools increased their fees by a greater amount than forecasted.

But the Office for Budget Responsibility said there was still “uncertainty” around the cost of educating more pupils in the state sector as a result of the policy.

A survey by the Independent Schools Council in September shows there are almost 25,000 fewer private school pupils since Labour won the general election in July 2024 – suggesting a far bigger exodus than government modelling had forecast.

[Source: Daily Telegraph]