…levy may lead to a net income loss for universities as they struggle to fully pass it to students
The government of Scotland has formally rejected a proposed United Kingdom (UK)-wide levy of £925 per international student intake from 2028.
The decision signals a strategic effort to reinforce the nation’s reputation as a premier destination for global talent.
Ben Macpherson, minister for Higher and Further Education in Scotland, confirmed the stance at the 2026 Scottish Universities International Group (SUIG) conference in Glasgow.
About the levy
The UK government had earlier proposed a new international student levy for universities in England, scheduled to begin in August 2028.
Under this plan, higher education providers will be required to pay a flat annual fee of £925 for every international student they enrol.
Ministers intend to use the generated revenue to fund maintenance grants for disadvantaged domestic students, a core component of the government’s broader “Plan for Change” initiative.
Financially, the government expects the levy to generate significant revenue, starting at approximately £445 million in its first year and rising to £480 million by 2030. However, official modelling reveals a troubling side effect for the institutions themselves. Because the levy acts as an additional cost that universities may struggle to fully pass on to students, the sector is projected to face a net income loss.
This deficit is expected to grow from £270 million in 2028 to an annual hit of £330 million by the third year of the programme.
The implications for the UK’s higher education landscape are profound. While the policy aims to support social mobility for British students, it places a heavy financial burden on universities that are already reliant on international fees to stay solvent.
This may force institutions to reconsider their recruitment strategies or cut costs elsewhere to absorb the loss.
For international students, particularly those from regions like Nigeria, this policy could lead to further tuition increases as universities attempt to recover the £925 fee, potentially making an English degree less competitive compared to options in Scotland or other global destinations.
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Opposing the “HE Levy” and UK immigration policy
The Scottish government’s refusal to adopt the levy is framed as a direct intervention to maintain attractiveness in a tightening global market.
Macpherson argued that UKs broader immigration stance is actively undermining Scotland’s academic interests.
“We have taken that decision to help international students and graduates see Scotland as an even more attractive place to come and study. The Scottish government is absolutely committed to enhancing our global reputation as a welcoming and inclusive country, including for those who are coming to study,” he stated.
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Addressing visa delays and enrolment barriers
The conference also addressed the immediate crisis of visa processing.
Recent reports indicate that “mandatory checks” by the Home Office have caused significant delays for the January 2026 intake, with many students still awaiting decisions well into February.
Macpherson assured the sector that the Scottish government is actively lobbying for administrative improvements:
Despite the challenges, Scottish university leaders are pivoting their recruitment strategies. Mike Bates, Chair of SUIG and head of Student Recruitment at Heriot-Watt University, suggested that the era of simply increasing student numbers is giving way to a more sophisticated model of “strategic reach.”
Bates explained the new direction for the sector:
“In the current climate, growth for Scotland is less about increasing volume and more about building resilience and strategic reach. That means diversifying markets to avoid over‑reliance on any single region, strengthening partnerships that create sustainable recruitment pipelines, and expanding transnational education.”
He further noted that individual universities are now seeking more “nuanced” pathways. “Growth is also becoming more nuanced and institution‑specific. Some universities will deepen their already strong connections with the US, while others will focus on emerging markets or partnership‑led pathways. Scotland’s return to the Erasmus scheme in 2027 will further widen mobility opportunities and reinforce our position as an outward‑looking, globally connected sector.”
