The move follows complaints from high street traders that many of the products are bought by schools free of VAT and then sold on to pupils at a discount.
The fear is that schools are turning the VAT concession into a business enterprise, undercutting shop prices.
Critics say the supply of musical equipment is where the concession is most abused. Arthur Spencer-Bolland, of the Music Retailers' Association, said: 'Everyone now knows they can purchase a professional musical instrument through the local authority without paying VAT.' He claimed to know of a case where a rich piano student bought a Steinway at a substantial discount through a college.
The Department of Education could not say how much schools and colleges reclaim in VAT, but it runs into millions of pounds.
Customs & Excise said inspectors were compiling a review covering all items on which VAT is reclaimed, including art, sports and electrical equipment. But a spokesman stressed it could be several months before any conclusions are reached.Reuse content