Will the Government Tax International Students? Everything You Need to Know

Say it ain’t so!

While it’s not confirmed, there have been some whisperings of a proposed change looking to tax international students in Australia - specifically tertiary education international students.

If you’re an international student and you’re feeling absolutely stunned by this news, don’t worry nothing has been confirmed just yet. If you want to know what's happening, or if some of your international student friends are freaking out, we’ve broken down everything you need to know about the proposed change.

It’s not a tax for international students, but a levy.

If you’re asking "what the heck is a levy", don’t stress - we gotchu.

A levy is an amount of money, sometimes known as a tax, that different people might have to pay the government.

Essentially, the Australian Universities Accord discussed in their interim report, the idea of charging international students a fee, like a tax, to generate more money for research and infrastructure improvements at universities. This proposal came up because there is a demand for additional funding in these areas. 

Education Minister Jason Clare said on ABC’s Afternoon Briefing this was just “one of about 70 ideas” in the interim report. The final report is only due to be handed down next month.

Here’s how the (proposed) levy would work.

If you didn’t know, there are already two levies placed on international students that go towards funding specific government services that support international students and providers.

This proposed levy would mean universities would pay some of the fees they receive from international students into a central fund managed by the government. This proposed levy is also different because the fee stream is much higher than the other levies and it's unclear how it would support international students. So, it is very much like a tax on international students in Australia.

Why has the levy/tax been proposed?

Australian universities have been depending more and more on the money they get from international students’ tuition to cover expenses – mostly because international students pay much more in fees than domestic students do. And a lot of the time universities use that money to make up for the lack of funding for research and development.

Are there any dangers?

If the proposed change goes through it could deter international students from choosing Australia as a place to study. 

A report by the Melbourne Centre for the Study of Higher Education suggests that the levy could make international students feel like they are being treated as sources of money as opposed to worthy students.

Universities part of the Group of Eight are concerned the proposed levy could damage Australia’s standing as a preferred destination for international students.

If you didn't know who the Group of Eight are, they are:

• Australian National University.
• UNSW Sydney, Monash University.
• The University of Western Australia.
• The University of Melbourne, The University of Queensland.
• The University of Sydney.
• The University of Adelaide.

If you’re an international student, don’t panic just yet. The levy has not officially been put in place, it’s only been proposed.

The final report will only be published in December 2023 and the federal government will only respond in 2024.

Header Image: Unsplash.