Media release: Victoria’s tax on learning will hurt families and schools

30 June 2023

The Victorian Government’s announcement that it will impose payroll tax on non-government schools with fees of $15,000 or more will hurt dozens of schools and thousands of Victorian families.

The national peak body, Independent Schools Australia (ISA) has opposed the introduction of this tax impost on selected schools since the Victorian Government’s Budget announcement – without consultation or warning – several weeks ago.

ISA Chief Executive Officer, Mr Graham Catt said today, “Independent schools, families and communities across the country are watching the situation in Victoria with great concern.

“There is no justification for imposing payroll tax on schools that are an important component of the education system, educate thousands of young Victorians and make a significant contribution to their communities,” he said.

Fifty four Independent schools will be targeted by the Victorian Government, in a move that will affect the families of 63,123 students. The average impact of the tax is $1,155 per student.

“School funding is a complex national arrangement, comprising federal legislation and agreements between the commonwealth and the states and territories.

“This arbitrary decision to target schools for revenue shows a fundamental misunderstanding of how the system works, how schools operate, and the potential impacts of the tax on a complex needs-based funding model.

“Many schools will pay the Victorian Government more in tax than they receive in funding.

“The tax will hurt thousands of families who make sacrifices to educate their children in a school of their choice and are already struggling with cost-of-living increases.

“Schools will now have to consider whether to reduce programs, cut staff, or raise fees.

“This tax on learning is simply unacceptable, no matter what arbitrary threshold is set.

“We urge the Victorian Government to take the only sensible path and repeal it.” Mr Catt said.

ISA is the national peak body representing 1,209 Independent schools with 688,638 enrolled students and a workforce of 115,000 people.