Report raises concerns there is ‘no certainty for families or schools when it comes to the payroll tax’

The opposition is calling on the Allan government to reconsider its “unfair tax”, which is being passed on to more private schools. See which schools are affected.

The State Government will raise an additional $26.9m by 2029 due to an extra 18 private schools becoming eligible to pay the payroll tax, new modelling has revealed.

The list of schools, released by Liberal MP Jess Wilson, includes special needs educator Rossbourne School along with a raft of Catholic schools such as Star of the Sea and Marcellin College.

It comes as 59 other schools are due to start paying the controversial tax from mid next year, forcing some such as Wesley College to raise fees by up to seven per cent due to the $15m budget blow.

The State Government was forced to exempt special school Andale following an outcry from staff and parents.

The tax will affect an extra 18 private schools by 2029. Picture: iStock

The report from the Parliamentary Budget Office shows that three more schools will qualify for the tax in 2024-5, three more in 2025-6, seven in 2026-7, 13 by 2027-8 and 18 by the middle of 2029.

This is based on estimated growth in income per student of 4.2 per cent.

The Minister for Education has said the $15,000 threshold for the tax will not change until at least 1 January 2029, but that non-government schools will be assessed annually to see if they qualify.

Rossbourne School principal Shane Kamsner said he would seek an exemption similar to Andale, and would look at the detail of the report before commenting further.

Ms Wilson, who is the new opposition education spokesperson, said the report “shows there’s no certainty for families or schools when it comes to the payroll tax”.

“The government said it was setting the list now but it is looking to reassess each 12 months and more and more schools will be added to the list”.

Catholic Education Commission of Victoria executive director Jim Miles said no Catholic school should be subject to payroll tax because they are not-for-profit community services.

“We call on the new Premier and Education Minister to urgently reconsider this unfair tax.”

De La Salle College Acting Principal Seamus Corgie said his was not a wealthy school.

“Most of our families are hardworking people who already make sacrifices to provide their sons with an affordable Catholic education,” he said.

“We don’t operate a budget surplus and already face increasing costs such as energy, salaries and building and refurbishments.

De La Salle College does not operate a budget surplus, acting Principal Seamus Corgie says. Picture: Stuart Milligan

“But the fact is we will either need to reduce expenses or increase fees to pay for this tax,” he said.

Michelle Green, chief executive of Independent Schools Victoria, said the “only way to avoid the tax is to not increase fees, even by a modest amount.

“This is impossible, given rising cost pressures and the need to main services for students,” she said.

“Schools which will be hit by the tax from next year have had no alternative but to reluctantly increase fees, even as they have sought to cut costs elsewhere.”