AM backs proposals for tax fairness

Tax advantages that private schools and hospitals obtain by applying for charitable status could end under new proposals outlined by the Welsh Labour Government.

The plans specifically concern the payment of non-domestic rates, otherwise known as business rates, and Wrexham’s Assembly Member, Lesley Griffiths, has welcomed the announcement that would ultimately place independent schools and private hospitals on an equal footing with their public sector counterparts.

A consultation will be launched considering removing charitable rate relief from private schools and hospitals where they are registered as charities.  State schools and hospitals are obliged to pay non-domestic rates, as are all other ratepayers.

It is the latest move by the Welsh Government to address shortcomings in the business rates system following last September’s announcement that all children’s day nurseries will be exempt from paying business rates from April 2019.

In the longer term, the Welsh Government is looking at reforming the business rates system.  The overriding aim will be to provide greater resilience for local authorities, fairness for citizens and businesses and to ensure there is sustainable funding for vital local services.

Lesley Griffiths AM said: “I am sure the vast majority of people will agree consulting on stopping private schools and hospitals from claiming business rates relief as charities is entirely appropriate.”

“The current system, quite frankly, is unfair.  The proposals will help create a level playing field, ensuring state and private schools are treated the same way when it comes to tax.”