6% SST on school fees above RM60k, the hidden cost hitting families right now
Schooladvisor Team
The implementation of the 6% SST for school fees above RM 60k in 2025 has affected many families with children enrolled in international schools. Here are some reasons why.
During Budget 2025, the government announced a 6% Service Tax (SST) imposed on private preschool, primary and secondary education providers across Malaysia.
Implemented in July 2025, this “hidden cost” prompted a pivotal shift in how the government collects revenue from the private education sector.
What Is The Tax?
The tax is not a blanket increase for all students. Rather, it is a targeted measure aimed at the government's classification of "premium" education services.
Taxable Services : The 6% SST applies to tuition fees, registration fees, and English as an Additional Language (EAL) charges.
Who is Affected : Only students whose total annual fees exceed the RM60,000 threshold are subject to the tax.
Exemptions : Malaysians with OKU cards remain exempt from this charge, regardless of the fee amount.
For international students studying at the tertiary level, the 6% SST applies regardless of the threshold.
How It Impacts Parents
For parents with children studying in international schools, the implementation of the tax becomes a major financial concern. A programme that costs RM 70,000 annually will now incur an additional RM4,200 in taxes, increasing the total cost to RM 74,200. Many parents also believe schools may pass on the increased operational costs to them, either through higher fees or hidden charges.
Sandra Lee, a mother of two children who enrolled them in an international school, told The Star that the tax policy would further add to families' financial strain.
“Education is essential, and any additional strain on affordability could force families to make tough decisions about their children’s schooling,” she said.
What Parents Should Look Out For
As schools adjust their prices, parents also need to take into account multiple factors:
- Ancillary Costs: While tuition is taxed, items such as uniforms, bus services, and cafeteria meals are often billed separately and may be subject to different tax treatments or remain exempt.
- Early Bird Discounts and Offers: Some schools offer rebates for upfront annual payments. These discounts can help offset the new 6% tax burden.
- Fee Hikes: If your child's fees are currently just under RM60,000, keep in mind that a standard annual fee hike by the school could push you into the taxable bracket next year.
As 2026 continues on, the "hidden" nature of this tax has long vanished, but the effects it has are noticeable and have made international schools slightly pricier for parents looking to enrol their children into them.
