Government changes course on for-profit VAT

By John Morgan. George Osborne’s budget has revealed that the government appears to be scrapping plans to grant VAT exemption to for-profit higher education providers, a move that was aimed at exposing universities to greater competition. The chancellor’s budget speech, delivered today, also confirmed further 1 per cent cuts to non-protected departmental spending in 2013-14 and 2014-15, and a bigger than expected total reduction in the 2015-16 spending review, meaning more reductions at the Department for Business Innovation and Skills.
Mr Osborne said in the speech that the coalition government’s “reform of schools, universities and apprenticeships is probably the single most important long-term economic policy we are pursuing”. In the accompanying “red book” document published following Mr Osborne’s speech, there is a section dealing with VAT for for-profit HE providers. Read more...