“Graduate tax shock”

Posted: 13 Jul 2010 06:03 PM PDT

BUSINESS Secretary Vince Cable is considering replacing student tuition fees with a new graduate tax, it emerged last night.

Ministers are looking at controversial plans to slap a tax on students after they leave university.

The Sun can reveal that Mr Cable has discussed the plans with Liberal Democrat colleagues.

The proposals would see graduates paying for their courses through a special tax once in work.

They would replace the current system where students are charged a tuition fee each year.

The maximum fee next year will be 3,290.

Students currently take out loans to pay their bill, which they pay back when they get a job.

Lib Dem peer Lord Willis last night said he had discussed the tax idea with Mr Cable.

He said: "In the current climate, students should pay for the huge advantage they get from their education.

"The best way would be some form of graduate tax which you start paying once you earn more than 20,000 and would last for 20 to 25 years."

The plans emerged as ministers prepare for a report on the future of universities by Lord Browne in the autumn.