Independent Faith Schools: VAT

Ian Sollom Excerpts

Thursday 26th February 2026 Westminster Hall

[Ian Sollom (St Neots and Mid Cambridgeshire) (LD)]

It is a pleasure to serve under your chairmanship, Sir Alec. I thank the hon. Member for Strangford (Jim Shannon) for bringing forward this debate.

It is well established that the Liberal Democrats oppose taxing education, whether that is independent, faith or non-faith schools. We did not support the Government’s decision to end the VAT exemption for independent schools, nor them treating such schools differently from other independent education providers for VAT purposes. Neither did we support the Government’s policy to remove private schools’ charitable business rates relief of 80%, for those that are charities.

Our position applies equally to all independent schools, but I acknowledge that for many parents, choosing a faith school is not primarily a financial calculation; it is an expression of deeply held conviction about how their children should be raised, and about community and belief. The Government should be mindful of how the policy bears on those for whom a faith education is not a luxury but a matter of conscience. It must be the choice of parents to decide where their children are educated. We understand that the choices parents make have many reasons, and it is parents’ right to make such choices without being subject to further taxes.

I have heard from several of my constituents on this issue, none of them wealthy but all of them working hard and wanting to do the very best for their children. Some, alongside many others across the country, have struggled to find a local state secondary school place for their child and have been offered one many miles away. That has meant that they have had to resort to private school, while they sit on long waiting lists for places that will never become available, leaving them under considerable financial pressures.

Many other parents have been failed by the school their children attended, which has not provided the support that they need. They have been forced to move to the private sector, again at considerable cost. That has not been a choice, but something they feel has been forced on them, because of issues with the school system. Any parent making that choice, however, for whatever reason, should certainly not be penalised with more taxes.

It must be noted that parents of children with special educational needs and disabilities often turn to independent schools, because support is not available in local state schools. Independent schools educate more than 100,000 children with SEND. That number tells its own story.

In the past year alone, 100 independent schools are reported to have closed their doors and a further 26 are predicted to follow this year. A small number of those were part of the natural churn, but the majority were not. They include primary and secondary schools, sixth-form colleges and special educational needs schools. The Liberal Democrats remain concerned that such ongoing closures will have a knock-on effect in some areas of the country, which will see an increase in pupils applying and entering the state school system. In Kent, for example, nearly 100 state school inquiries were made in just 48 hours, after the independent Bishop Challoner school announced its closure. The state school system is already struggling with large class sizes, declining teacher numbers and increasing numbers of pupils with SEND. The Government cannot expect the state sector to absorb the pressures that these increased numbers will bring.

The Liberal Democrats, however, do believe that independent schools benefiting from VAT exemptions should give back to their local communities. Indeed, many already do, through shared facilities, joint programmes and genuine partnerships with neighbouring state schools. We want to see that best practice become universal, with investment proportional to school size and fees, and schools expected to demonstrate their contribution through the inspection process. Faith schools in particular often have a strong tradition of community service that goes well beyond the school gates. We should recognise that and see it built upon.

The Government must look seriously at the negative impact of VAT on faith and non-faith independent schools, the impact on the state sector, and the very real financial burden on families who have already paid tax into the system. I look forward to hearing from the Minister how the Government intend to address the concerns expressed today.