This past week, the Ontario government announced an extension of the domestic tuition freeze for the 2023–2024 academic year. This tuition freeze first came into effect in 2020 and has been in place since then. However, tuition fee changes for international students remain unregulated.

For years, international tuition has been a much-debated topic at U of T, with students and faculty alike challenging the enormous disparities between domestic and international tuition rates. 

In its last budget report, U of T stated that the high fees it requires from international students “[take] into consideration the full cost of providing a program and [were determined] with reference to fees at peer Canadian and US universities.” This is a prevalent pricing strategy, with McGill University having said the same about its 35 per cent international tuition fee hike in 2020. 

However, U of T’s tuition far exceeds tuition at rival Canadian institutions. U of T may be a more desirable destination for international students — a factor that appears to be priced into its higher tuition fees.

U of T’s history with tuition

Before 2019, undergraduate domestic tuition at U of T rose at a fairly constant rate of three to four per cent annually. On January 17, 2019, the Government of Ontario announced that domestic tuition fees in 2019–2020 would be cut by 10 per cent “[to make] university more affordable and accessible for students and families.” 

It also announced that tuition would remain frozen at that level for the 2020–2021 academic year — a policy that was extended this past Thursday through the 2023–2024 academic year due to a desire to ensure financial stability for Ontarians, especially given financial accessibility concerns following COVID-19. 

This freeze did not apply to international students, however. Since the Government of Ontario doesn’t regulate international tuition, universities are free to engage in price discrimination. At U of T, this lack of regulation has resulted in extreme disparities between undergraduate international and domestic tuition rates — with increases in international tuition outpacing domestic tuition each year. U of T increased tuition for students from outside Ontario this academic year, while the fee for Ontario residents remained the same as the previous year.

Differentiation between in- and out-of-province students 

International students aren’t the only ones with differentiated fees; the 2022–2023 academic year meant the beginning of differentiated fees for out-of-province students. In 2021–2022, the Ontario Ministry of Colleges and Universities introduced a policy allowing for a three per cent increase in out-of-province domestic undergraduate tuition.

This increase was applied to all undergraduate programs in the 2022–2023 academic year, although many U of T students argued the two-tier domestic fee system was regionally divisive. This kind of price differentiation is a common practice, with McGill differentiating tuition by province as well. Several American universities also differentiate tuition for in-state and out-of-state students. Even with this new change, however, out-of-province students still pay much less than international students. At U of T, the tuition for out-of-province students in the Faculty of Arts and Science for the 2022–2023 school year was $6,280, while international students paid $59,320.

A Canadian context

Undergraduate international students at several top Canadian universities pay tuition fees far greater than domestic students, but there’s still notable variation between institutions. Among Times Higher Education’s (THE) top 10 Canadian universities in 2023, the mean tuition for undergraduate international arts and science students was $39,681.26, with a standard deviation — which measures how far values lie from the mean — of $9,833.72. The rankings are determined by 13 performance indicators, measuring institution research, teaching, knowledge transfer, and international outlook.

U of T ranks first in the THE rankings and has the highest international tuition fees by a large margin — U of T’s undergraduate international tuition for students in the Faculty of Arts and Science (FAS) in fall 2022 was $59,320.01. That’s almost two standard deviations greater than the mean. 

The top four universities on the THE list are U of T, McGill University, the University of British Columbia (UBC), and McMaster University — each of which is one of the top 100 universities in the world according to the THE 2023 World University Rankings. U of T ranks 18th in the world, McGill 40th, UBC 46th, and McMaster 85th. The average undergraduate international tuition of McGill, UBC, and McMaster is $43,121.06, with a meager standard deviation of $262.19. When U of T is added to the pool, the mean tuition becomes $47,170.80, and the standard deviation is $7,018.02.

Observing institution composition of international students

You may think that U of T’s above-average international tuition is because international students make up a greater proportion of enrolment than at other institutions. This would make price differentiation an effective way of raising revenue, especially in light of decreasing government grants.

Other top Canadian universities have slightly smaller ratios of international students to domestic students than U of T. Undergraduate FAS international students entering U of T in the 2021–2022 academic year represented 36 per cent of the FAS’ total entering enrolment. McGill and the UBC Vancouver campus — where UBC’s numbers do not include applied science students — reported 29 and 28 per cent international student enrolment, respectively, for similar undergraduate divisions. 

Although U of T has only moderately larger proportions of international student enrolment compared to UBC and McGill, undergraduate FAS international students entering U of T in the fall of 2022 paid considerably higher tuition than their counterparts at other top Canadian universities. Undergraduate international students paid 39 per cent more at U of T than at UBC and 37 per cent more than at McGill. 

U of T tuition competes on the global stage

This begs the question as to why fees are so high at U of T if other Canadian universities with a similar composition of international students boast much lower costs. In an email to The Varsity, a spokesperson for U of T defended its comparatively higher tuition: “As a Top 20 world university, U of T competes more directly with similar-ranked North American universities, where undergraduate tuition is equivalent to more than $80,000 in Canadian funds.” 

This suggests that while other Canadian universities may be basing their international tuition on comparative Canadian institutions, U of T places greater emphasis on competing with the pricing of American universities that are similar in world rankings and therefore, prestige.

For instance, the University of Chicago, which ranks 13th in the THE 2023 World University Rankings, set tuition for both domestic and international students in 2022–2023 at about 79,612.23 CAD, using an exchange rate of CAD 1.30 for USD 1. That figure is roughly $20,292.23 greater than that of U of T international tuition, making U of T much more affordable. Although UChicago is a private institution, U of T international tuition is unregulated, meaning that we still can compare the two rates since both institutions charge at their discretion.

Echoing these observations, James Wang, a second-year international U of T student from Singapore double majoring in political science and philosophy, wrote in an email to The Varsity, “In terms of tuition… [international student tuition at U of T] is extraordinarily more expensive [compared] to domestic but in a studying abroad perspective it’s actually not the most expensive option, compared to the UK international fee and those of the private schools in the [United] States.”

The University of California (UC) Berkeley, a public university that ranks eighth, set tuition for out-of-state students in 2022–2023 at about $59,568.60 CAD, using the same exchange rate. That figure is about $248.60 higher than that of U of T international tuition. 

Reputation is king

While comparative affordability is a strong selling point for some international students selecting Canadian universities over other schools in other countries, there are still factors beyond tuition, such as ranking, reputation, and location, that inspire them to select U of T over more affordable Canadian universities.

Ana María Guevara is a second-year international student from Mexico studying economics, international relations, and business German. In an email to The Varsity, she cites U of T’s premier reputation and urban location, including its proximity to Pearson Airport — providing her with direct flights to Mexico — as reasons why she chose U of T despite the higher tuition. 

Similarly, Wang wrote that he applied to 14 different schools in four countries before selecting U of T. Like Guevara, he references U of T’s reputation as what prompted him to choose it over UBC or McGill.  The 2022 THE World Reputation Rankings, which rank universities on their research and teaching qualities according to the opinions of senior and published academics, supports Wang’s and Guevara’s comments — U of T ranks 21st in the world, with UBC and McGill at 40th and 50th place, respectively.