Plans to remove rate relief from independent schools have been delayed as a result of Covid-19
The removal of rate relief for private schools has been delayed.
The Scottish Government announced at the end of 2019 that independent schools would no longer get charitable relief of up to 80% on their bills for non-domestic rates.
However plans to remove the rate relief have been delayed until April 2022 due to the coronavirus pandemic.
In an updated Scottish budget statement this week, Finance Secretary Kate Forbes made the announcement alongside announcing temporary rate relief for retail, hospitality, leisure and aviation businesses.
It was announced at the end of 2017 that independent schools would lose out on the on the back of the Barclay Review into business rates.
A year-long probe into Scottish business rates by former RBS chairman Ken Barclay made 30 recommendations and found no justification for private schools or so called arms-length external organisations (Aleos) of councils to continue receiving preferential business rates.
John Edward, director of the Scottish Council of Independent Schools, welcomed the move, highlighting that schools had been experienced around a £40m hit as a result of Covid-19.
“It's obviously a welcome relief, as schools are stuck between being not-for-profit but now uniquely deprived of full charitable relief. As such, other measures to help different sectors through the crisis do not apply.
“Opposition to the loss of relief was based on an objection to making schools pass a specific charity test then taxing them for having done so. As OSCR said itself, it created a difficult precedent for the charitable sector by installing to a de facto two-tier register. Any set of charities whose purpose might be unwelcome to one group in society or another should have concerns about that.
“I took the opportunity to gauge the ongoing financial impact of Covid-19 on independent schools specifically. Twelve schools were included, representative of our memberships’ size and range, representing approximately 30% of the pupil roll of the independent sector. If, as it is reasonable to assume, the remainder of the sector incurred similar losses, the overall and direct financial impact of the pandemic on the independent sector can be estimated at £40 million for 2020-2021.”
Edward highlighted that independent schools have offered to act as vaccine centres, have provided support to school hubs, produced PPE and provided kitchen facilities for charities such as Scran Academy and Thomas Franks’ Feeding Communities.