UNIVERSITIES have benefited from over £50m of tax reductions from their non-domestic rates bills, the Herald on Sunday can reveal.
The multi-billion pound sector, which makes hundreds of millions of pounds from tuition fees, qualifies for the support on account of being classed as charities.
Businesses have been hit in recent years by hikes to their NDR, a property tax based on the rateable value of their buildings.
Some of the increases were capped, but the rises resulted in companies making a larger contribution to the public purse.
However, at the same time, charities are entitled to an 80% discount from their NDR bill, even though their turnover can be larger than that posted by commercial firms.
Private schools, some of which charge over £30,000 a year for their services, are categorised as charities, but they face losing their relief following a decision by the Government.
Higher education institutions are also considered to be charities and, given their extensive property portfolios, the subsidy provides them with a huge tax break. Over the last two years, ten universities north of the border received NDR discounts of nearly £50m.
Top of the league was Edinburgh University - an organisation with revenues of around £984m - which had an NDR bill of nearly £29m between 2016 and 2018, but received £26.2m off. Glasgow University received a £9.9m discount from the property tax in the same period.
Stirling’s bill came in at £3.8m, but a discount of £3.1m ensured the liability fell to around £700,000. Glasgow Caledonian’s total over the two year period stood at £4.4m, but charitable status ensured that £3.5m was lopped off.
A discount resulted in Dundee University’s bill falling from £1.4m to around £300,000, while nearby Abertay saw its charge reduce from £1.1m to around £227,000. According to the Office of the Scottish Charity Regulator, eight of the top ten “highest income” charities are universities, with Edinburgh coming first, followed by Glasgow, Strathclyde and Dundee. The income of these institutions stands at over £5bn. Thirteen universities are in the OSCR top twenty.
Alastair Sim, the spokesperson for Universities Scotland, which represents the sector, said:
“Universities make very strong contributions to the advancement of so many other charitable purposes additional to education including the advancement of health, the arts and environmental protection.
“Charitable status allows universities to work with Governments, industry and other third sector organisations but to be independent from them. This is vital to the quality and integrity of what universities deliver; education and research without influence which is a hallmark of any free society.”
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