WHAT WILL GRADUATE TAXES COST YOUR FUTURE?

Changes to student finance could leave students, graduates, and Universities all worse off.

The Cost to You

Under the rumoured changes to student finance, the average graduate will pay around £10,000 more over their career than they do now. That means paying almost 50% of all earnings in tax.

Check out how it could affect you by entering your details below:

Who are We?

We are a group of Students’ Unions based in the South of England who are campaigning to lobby the government and inform students about the impact of proposed change in student fees and funding.

The government’s current spending review will be concluded at the end of October with an announcement that we expect will:

  • Reduce the salary threshold for student loan repayments.  Currently graduates need to be earning over £27,000 a year to start paying back their student loans. It’s likely that this will be reduced to as low as £21,000, meaning that lower earning graduates will be worse off.
  • The proposals are also likely to increase the time that graduates will be paying back their loans before any unpaid debts are written off by the government, from the current 30 year to a 40 year limit.
  • Graduates in their 20s are likely to be paying nearly 50% tax when they start work.  The changes will impact different types of graduates in a variety of ways, but overall those who begin their working life at a disadvantage, such as women, black and ethnic minorities and disabled students, will be further disadvantaged by the changes.
  • The recent Auger Review also recommended a reduction in tuition fees, leaving Universities with less funding per student, and if accompanied by changes to student loans, graduates will still be worse off and some Universities will risk cutting courses or closing completely. 

What are we lobbying for?

  1. Any changes to the repayment threshold that would negatively affect graduates should not be applied retroactively.
  2. Any changes to the loan system should be considered in such a manner that they do not disadvantage graduates in their early careers or by extending the repayment period.
  3. The repayment threshold should never sit below median non-graduate earnings. In 2021 this is projected to be £26,500 and in 2022 this is projected to be £27,105.
  4. Where there is a reduction in spend within Higher Education, the government should be responsible for ensuring that the student experience is protected.
  5. Courses such as the Arts and Social Sciences are beneficial and should be appropriately funded.
  6. No graduate, especially those within the lowest salary bands, should have a marginal tax rate of 50%.

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