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Why didn't the coalition implement a graduate tax instead of this tuition fee rise? Watch

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    Here are some facts and predictions about the new tuition fees:

    - Fees are paid after graduation, at 9% of your income over 21k for 30 years
    - It is predicted that most graduates won't be able pay back the full amount in the 30-year repayment period
    - It is predicted that £9,000 tuition fees will very soon become the "going rate" for all university courses due to funding cuts

    Given all the above information, this new scheme sounds to me like a tax in every way but name.

    Why do you think the coalition decided to raise tuition fees rather than levying a graduate tax? The financial impact of a graduate tax would have been pretty similar/almost identical to the fee rises but it would have been WAY more popular. I doubt many people would claim that a graduate TAX deters lower-income students.

    Does anyone know why the coalition decided on fee rises rather than the financially similar policy of a graduate tax? :confused: I'm utterly confused.
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    From the student's point of view, it is effectively a graduate tax - all repayment schemes are, just with different numbers involved in caps/limits/boundaries etc.
    The difference occurs at the university level, to do with the amount of funding the university gets from the government.
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    I still can't forget that moron at the protests who was interviewed by the BBC and said that now tutition fees are going to rise to 9k and EMAs are being scrapped there's nothing stopping him from selling drugs.
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    a tax would be paid for the rest of your life not 30 years max, so you could still be paying it 60 years later if you live that long. why would that be more popular?
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    To be fair, ttx did point out a flaw in the graduate tax on another thread, in that it could be easy to avoid by students going abroad, I think that might have been enough to put the coalition off this policy.


    (Original post by TheBigCh)
    From the student's point of view, it is effectively a graduate tax - all repayment schemes are, just with different numbers involved in caps/limits/boundaries etc.
    Yeah, exactly.


    The difference occurs at the university level, to do with the amount of funding the university gets from the government.
    Perhaps I'm being stupid here, but could you elaborate on that? I don't quite follow this.

    Under the current proposed scheme the government gives money to the university equal to the value of each student's tuition fee. The student is expected to repay this money to the government after graduation.

    Under a graduate tax scheme, the government could give money to the univeristy equal to the value of what each student's tuition fee would have been (9k for every course according to the HEPI). The student is expected to repay money to the government after graduation.


    (Original post by boba)
    a tax would be paid for the rest of your life not 30 years max, so you could still be paying it 60 years later if you live that long. why would that be more popular?
    You wouldn't have to do it like that. The government could have the tax end after 30 years if they decided that- it's up to them. It would be more popular because most people think that the fees are paid upfront instead of ater graduation, whereas a graduate tax is quite obviously paid after graduation.
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    (Original post by innerhollow)
    Does anyone know why the coalition decided on fee rises rather than the financially similar policy of a graduate tax? :confused: I'm utterly confused.
    Maybe because that way it is certain that the money goes directly to the universities depending on how many students they attract and keep. Tax income would have to be centrally distributed by the government and could even end up being spent on other things than universities.

    I'm sure universities prefer the new system to a real graduate tax.
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    (Original post by llys)
    Maybe because that way it is certain that the money goes directly to the universities depending on how many students they attract and keep. Tax income would have to be centrally distributed by the government and could even end up being spent on other things than universities.

    I'm sure universities prefer the new system to a real graduate tax.
    Under the current tuition fees of 3k, the government pays something like 7k directly to the university for every home student they take within their quota. I assume that whatever the scheme was, the universities would always receive the money they need to teach each student.
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    Because Cameron and Clegg are public school-bred toffs who wouldn't recognise an idea that seems ok to them but is detrimental to 99% of the student population if it danced in front of them naked.
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    (Original post by innerhollow)
    To be fair, ttx did point out a flaw in the graduate tax on another thread, in that it could be easy to avoid by students going abroad, I think that might have been enough to put the coalition off this policy.




    Yeah, exactly.




    Perhaps I'm being stupid here, but could you elaborate on that? I don't quite follow this.

    Under the current proposed scheme the government gives money to the university equal to the value of each student's tuition fee. The student is expected to repay this money to the government after graduation.

    Under a graduate tax scheme, the government could give money to the univeristy equal to the value of what each student's tuition fee would have been (9k for every course according to the HEPI). The student is expected to repay money to the government after graduation.




    You wouldn't have to do it like that. The government could have the tax end after 30 years if they decided that- it's up to them. It would be more popular because most people think that the fees are paid upfront instead of ater graduation, whereas a graduate tax is quite obviously paid after graduation.
    I can only say that it isn't the government's fault if people are thick. God knows they say 'you don't pay anything upfront' enough.
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    (Original post by innerhollow)
    Under the current tuition fees of 3k, the government pays something like 7k directly to the university for every home student they take within their quota. I assume that whatever the scheme was, the universities would always receive the money they need to teach each student.
    But there is a difference now. Under the new scheme, students get a loan to pay the money directly to the university they have chosen, and universities can do what they wish with this money. Funding is now no longer central and universities are more independent. Universities that manage to attract more students and are allowed to charge higher fees will make more money. (Currently, universities are penalised funding-wise by the government if they take too many home students.)

    If they were funded by tax income, universities would be dependent on the whims of whatever government is in power at the time. The funding they get could vary depending on the needs of the government and there would probably be less competition between universities.
 
 
 
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