Legal challenge imminent over Labour's VAT raid on private schools in Scotland - here is what it means

Labour’s VAT raid on private schools will be back in the headlines over the coming days as a legal challenge gets underway in England next week.

Depending on the outcome, it could have implications for the policy both north and south of the Border. Here are the answers to all the key questions ahead of the High Court battle.

Chancellor Rachel Reeves | Getty Images

What is the VAT legal challenge and when is it happening?

The action challenges the UK government’s decision to end the VAT exemption for private school fees. The policy was included in the Labour Party’s manifesto ahead of last year’s Westminster election and came into force on January 1, adding 20 per cent to the cost of attending private school.

The challenge was filed with the High Court of England and Wales before Christmas, and will be heard from Tuesday to Thursday - April 1, 2 and 3.

Who is behind the legal action?

The claim is being brought by seven families and is supported by the Independent Schools Council (ISC).

Following the initial claim, separate claims were filed on behalf of claimants supported by a parent-led group called Education Not Discrimination, and others attending various Christian faith schools. These cases are referred to as “Claim 2” and “Claim 3” respectively, and will be heard alongside the claim supported by the ISC, which is referred to as “Claim 1”.

Are Scottish private schools involved?

Yes. The Scottish Council of Independent Schools (SCIS) is an affiliate of the ISC. Lorraine Davidson, chief executive of SCIS, previously said: “The Scottish Council of Independent Schools took its own steps to obtain a legal opinion from a KC on the strengths of a legal challenge in the Scottish courts in relation to the many differences in the Scottish sector, and the likely discrimination faced by pupils and families in Scotland.

School girls arrive at Glenalmond College for the first day of term. Legal action is being taken that could impact on the decision to charge VAT for private schools. Picture: Jeff J Mitchell/Getty Images | Getty Images

“This advice will help inform the legal challenge being taken by ISC, of which we are an affiliate body.”

What will be argued during the case?

The case is a judicial review claim that will argue that taxing education is a breach of the right to education guaranteed by the European Convention on Human Rights (ECHR), and contest the way the UK government has implemented the policy is disproportionate.

The claimants will also argue the policy specifically threatens access to the education that cannot be provided by the state, for example, because children have complex needs, or want to access education in line with religious convictions, or have chosen single-sex education.

Chancellor Rachel Reeves is the formal defendant in the claim, and HMRC is also involved in the case as an interested party. The UK government’s Department for Education is listed as an intervener. In practice, all three government departments and ministers are being represented by a single legal team.

What will happen if the claim is upheld?

The claimants say they are seeking a declaration of incompatibility from the court, which is essentially a finding the legislation is incompatible with human rights law.

If the case is successful and such a declaration is granted, the legal effect would be to put the ball back in the UK government’s court to decide whether to change the law – either by amending parts of it or withdrawing the policy completely. The government may also choose to appeal the decision.

If the case is unsuccessful, the claimants’ respective legal teams will have to consider the court’s reasons and assess whether there is scope for an appeal.