The introduction of the 6 percent service tax on private education services for international students in Malaysia is likely to have a notable impact on Maldivian students, many of whom choose Malaysia as a preferred destination for affordable, high-quality education in a culturally familiar environment.
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Malaysia's Ministry of Finance has announced that the country will be charging a 6 percent service tax on private education services for international students starting 1 July 2025. This announcement, which was made by the ministery earlier this month, stated that the aim was to strengthen the country's fiscal position by increasing revenues and broadening the tax base without adding undue burden on the majority of Malaysians.
Although this announcement means a better financal position for the Malaysian economy, this news might not be as well received for international students from across the globe, who move thier livelihoods to Malaysia for a better education. With the tax being applicable for prive preschools, schools, colleges, universities, and language centres, the cost of education in Malaysia is set to increase in less than a weeks time.
The new tax which will be introduced in 1 July falls under Malaysia's revies Sales and Service Tax (SST). According to Economic Times, private institutions charging over RM60,000 per year in tuition must now register for the tax, and higher education instituitions and language centres must register regardless of turnover if they are teaching international students.
The introduction of the 6 percent service tax on private education services for international students in Malaysia is likely to have a notable impact on Maldivian students, many of whom choose Malaysia as a preferred destination for affordable, high-quality education in a culturally familiar environment.
The imposition of a 6 percent service tax starting 1 July 2025 may alter the financial equation for students choosing Malaysia as a more budget-friendly and familiar environment to study outside of the Maldives. For students from the Maldives who are already paying substantial tuition fees—particularly at private universities—this added cost could significantly raise the total expenses associated with studying in Malaysia. For example, at institutions where annual tuition exceeds RM60,000, the new tax would mean an additional RM3,600 or more per year.
This increase could lead some prospective students and their families to reconsider Malaysia as a viable study destination, especially when evaluating overall return on investment and comparing options in countries that do not impose similar taxes on international education.
Students who are currently enrolled may also face unexpected financial pressure, particularly if the tax is passed on directly by the institutions without sufficient notice or transitional support. Furthermore, Maldivians who rely on scholarships or student loans for education abroad may face funding shortfalls unless adjustments are made to reflect the new tax policy.
