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THE Ministry of Finance (MOF) has rejected claims that the government has failed to honour its commitments regarding tax exemption status for the TARC Education Foundation, stressing that all approvals are subject to legal conditions and compliance requirements.
In a statement on Monday, the ministry said that while the government recognises the role of the TARC Education Foundation in providing affordable private higher education, tax exemption approvals under Section 44(6) of the Income Tax Act 1967 are not granted automatically.
“In line with an announcement by the Prime Minister and Finance Minister Datuk Seri Anwar Ibrahim, institutions, organisations and charitable funds eligible for tax exemption may be granted approval for up to 10 years starting 27 November 2025, but only if they fully comply with stipulated requirements.
The ministry said the foundation’s application to extend its existing tax exemption, which is due to expire in 2025, was reviewed and found to have not fully met certain conditions, including improvements in governance and the management of donations.
However, taking into account the institution’s role in the education sector, the government has approved a temporary three-year extension on an interim basis to ensure continuity while compliance issues are addressed.
MOF added the extension period would allow time for the foundation to complete required improvements, after which it may qualify for a full 10-year exemption if all conditions are met, while it remains ready to facilitate and support the foundation’s efforts to strengthen its governance framework.
MOF stressed that tax exemption approvals must be guided by law, compliance standards and good governance principles, and should not be misrepresented or politicised. - July 6, 2026
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