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Last week the Secretary of State for Business, Innovation and Skills, Vince Cable, suggested a graduate tax as a ‘fairer’ replacement for tuition fees in higher education. All the Labour leadership candidates – with the exception of David Miliband – have expressed support for this idea, as has the National Union of Students; the leading universities, meanwhile, have opposed it. This Observation examines whether the rationale for such a policy and the practical implications of it have been fully considered.