Members of the House of Lords oppose ending tax relief for private schools, arguing that it would negatively affect students with special educational needs and disabilities.

March 19, 2025 TruthUSA

Baroness Diana Barran emphasized that she stands firm in her belief “that the long-standing tradition that education should be free from taxation should be upheld.”

The House of Lords rejected the proposal to eliminate tax relief for private schools in England, citing concerns about how it would affect students with special education needs and disabilities (SEND).

On Tuesday, peers voted 232 to 141—a majority of 91—in favor of an amendment to the Non-Domestic (Multipliers and Private Schools) Bill, removing Clause 5 that aimed to end charitable tax relief for private schools.

The Labour government had suggested discontinuing the 80 percent discount on business rates for private schools registered as charities, with the change scheduled to take effect from April 1, 2025.

The amendment was introduced by shadow education minister Baroness Diana Barran and Liberal Democrat peer Lord Michael Storey.

Presenting the amendment, Barran stated, “We do not believe that the long-standing tradition that education should be free from taxation should be broken.”

“It is evident that the government disagrees with us, as seen with the introduction of VAT on private school fees and now with the proposed change in this bill,” she added.

The move to eliminate tax relief follows the government’s decision to apply a 20 percent VAT on private school tuition and boarding fees, which came into effect on Jan. 1, 2025.

These tax adjustments aim to generate revenue for public education, funding initiatives such as hiring 6,500 new teachers, expanding early years provision, and introducing mental health support in all schools.

100,000 Pupils Without EHCPs

There are 2,444 private schools in England, with 1,139 being charities. The government estimates that a total of 1,040 private schools will lose business rates charitable relief—representing 43 percent of all private schools and 91 percent of those registered as charities.

The government has previously stated that private schools primarily focused on teaching SEND pupils with an EHCP will retain their charitable rates relief.

Lord Kevin Shinkwin, who lives with the genetic condition osteogenesis imperfecta—also known as brittle bone disease—highlighted that excluding Clause 5 from the bill “is essential to safeguard all SEND students attending private schools, similar to those I attended, that have a lower percentage of children with SEND than 50%.”

The Conservative peer pointed out that nearly 100,000 students in private schools receive SEND support without EHCPs.

According to the latest data from the Department for Education, over 1.67 million students in England’s state and private schools receive special education needs support. Among them, 434,354 have EHC plans, while 1,238,851 receive special needs support without an EHC plan, with 98,969 attending private schools.

SEND Children ‘Expendable’

Shinkwin expressed, “Unfortunately, these children’s life chances appear to be considered expendable by the government.

“They are viewed as immaterial, inconsequential, collateral damage, casualties of what seems to be an ideological fixation on penalizing anyone deemed wealthy,” he continued.

File photo of school children during class at a primary school in Yorkshire, England, on Nov. 27, 2019. (Danny Lawson/PA Wire) — File photo of school children during class at a primary school in Yorkshire, England, on Nov. 27, 2019. Danny Lawson/PA Wire

The peer described the proposals as “extremely detrimental and completely disproportionate,” echoing the sentiments of other colleagues in the House of Lords who argued that these measures will not significantly raise revenue to cover public education expenses.

Instead, he stated, “it will harm schools and particularly students with SEND who, like me, come from modest backgrounds. Their futures will be severely impacted by this implementation.”

Funding Needs to Be Paid For

Responding on behalf of the government, Lord Wajid Khan of Burnley reiterated that schools exclusively catering to EHCP students would be exempt under the bill’s carve-out.

Khan mentioned that Labour vowed to enhance school standards in its manifesto, with the government committed to removing VAT and business rates charitable relief for private schools as part of that effort to generate revenue for education and youth programs.

In the budget, there was an increase in per-pupil funding, with a £2.3 billion boost to the core schools budget, including nearly £1 billion extra for high-needs funding.

“This additional funding needs to be accounted for,” the minister explained, noting that ending tax relief and introducing VAT together will generate approximately £1.8 billion annually by 2029/30.

The bill is currently in its Third Reading in the House of Lords, after which it will return to the House of Commons for consideration of any amendments made in the upper house. The bill may move back and forth between the two chambers until lawmakers reach an agreement on the bill’s language, before receiving Royal Assent and becoming law.

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