The addition of VAT to school fees could lead to staff job cuts, Scottish independent schools have warned.

The Scottish Council of Independent Schools (SCIS) said schools “have little to no ability to absorb VAT” after the Scottish government removed business rate relief from independent schools in April 2022.

In its response to the government’s consultation on applying VAT to independent school fees, the SCIS said If the VAT policy is to go ahead, “The only financial lever open to most schools in Scotland as their income from fees declines due to pupil withdrawals, is to reduce staffing levels of both teaching and non-teaching staff.”

The SCIS said pupil withdrawals are likely to be higher in Scotland than in other parts of the country. It warned that the move would lead to a 13% fall in pupil numbers in Scotland, wiping out potential gains in revenue from VAT by reducing the amount collected by £7million.

The body, which represents 69 independent schools in Scotland including 20 specialist schools for children with complex needs, also criticised the UK government’s decision to bring the implementation date of the policy forward to January 2025. “This contradicts the widely trailed messages from senior Labour sources during the election that schools and parents would be given time to prepare for the change,” it said.