Starting July 1, 2024, independent schools that charge annual tuition fees over $8,000 might find themselves in the crosshairs of the Victorian government’s new payroll tax.

The revised figure, from $7,500, was revealed by government advisors earlier this week, but the two mid-fee Greek community faith-based independent schools, St John’s College in Preston and Oakleigh Grammar claim the new impost will impact on the quality of teaching and curriculum and may also potentially endanger their existence.

On Tuesday during question time Education Minister Natalie Hutchins said that around 85 per cent of non-government schools would not be affected by the changes to payroll tax.

“Government schools in this state have long paid payroll tax, and now we are ensuring the wealthier schools do the same to pay their fair share” The Age reported.

St John’s College and Oakleigh Grammar also stress that they provide an “essential service to the Greek community with respect to language and culture.”

The Greek schools’ principals say that the introduction of payroll tax “would jeopardise in the worst-case scenario, the ongoing viability” of the schools.

“At the very least, it would impact our schools’ current curriculum and co-curricular offerings and negatively impact staffing levels to continue to deliver value for money high quality education programs.”

In response a Victorian government spokesperson told Neos Kosmos that the government has an “established process for distinguishing between low-fee and high-fee independent schools.”

“The threshold will be indexed, and we’ll have more to say about which schools will no longer receive the exemption before the new financial year,” added the spokesperson.

They also said that “wages paid by public schools are subject to payroll tax”, and wages paid by all non-government schools are “registered under the Education and Training Reform Act 2006 exempt from payroll tax”

The new tax “will ensure the benefit of the exemption only flows to schools that genuinely need support and is estimated to raise $135 million in 2024-25.”

Opposition leader John Pesutto, hit out at the Andrews government and told Neos Kosmos that this was an “unfair tax” that seeks to punish parents who make sacrifices to provide their children with an education in schools of their choice.

“This is such an unfair tax that punishes parents for the sacrifices they make to send their kids to the independent school of their choice.

“Many of these parents are not on high incomes and the schools they choose do not have high fees.”

Pesutto said that the Andrews government wants to impose this tax “because it has made such a mess of the budget.”

The Opposition leader has committed to “repealing of this tax” if the Opposition win the 2026 State election.

The proposed new tax is projected to generate a $422 million in revenue for the state government over the next three and a half years. This controversial tax is part of the government’s effort address the mountain of debt accumulated during the 2020 and 2021 Covid pandemic, as the government tries to, “pay back the Covid credit card”.

St. John’s College and Oakleigh Grammar in a joint letter sent to all Victorian members of parliament, and supplied to Neos Kosmos, called for the continued exemption from the tax.

Mark Robertson, the Principal of Oakleigh Grammar, and Chris Damatopoulos, the school’s Chairperson, along with Andrew Ponsford, the Principal of St. John’s College, and Father John Frangos, the Chairman of the school, expressed their concern about the potential impact of the proposed tax on their “low to mid fee schools.” St. John’s College and Oakleigh Grammar anticipate a $700,000 burden in 2024 if such a tax is applied to them.

“…[A]ny further increase in school fees due to the introduction of a payroll tax would put many of our parents out of reach financially to afford an independent school education,” they write.

The annual fees for St John’s College and Oakleigh Grammar vary depending on the grade level. For Year 12 students, the annual fee at St John’s College is $8,000, while at Oakleigh Grammar, it is $12,650. It is important to note that both schools offer discounts for siblings attending and provide support for families facing hardships.

“Our school fees are already at the highest level of affordability for the parent demographic of each of our schools, many of whom are still struggling to recover from the significant impact of the Covid pandemic.

“We have continued to receive a high number of hardship applications from our parents due to a higher inflation rate and rising interest rates causing mortgage stress” the two principals wrote.

The “parent demographic” of the schools is largely average working Greek Australian families.