text of the legislative package<\/a> released Tuesday shows Republicans want to increase university endowment taxes ranging from a 1.4 percent to a 21 percent increase. \u00a0<\/p>\nFor institutions like Harvard University with a student adjusted endowment of $2 million, the tax on the endowment would bump up to 21 percent. \u00a0<\/p>\n
The gains on a university endowment were never taxed before Trump\u2019s first term in 2017 under a tax package that put a 1.4 percent rate on colleges with 500 or more tuition paying students and had $500,000 or more in endowment funds per student. \u00a0<\/p>\n
The increase in the tax would come as the Trump administration has gone to war with higher education, pulling research funding for numerous institution.\u00a0<\/p>\n
The biggest showdown has happened with Harvard when $2.2 billion in funding was paused and the university sued the administration. \u00a0<\/p>\n
In a recent letter to Harvard from Education Secretary Linda McMahon, she drew attention to the university\u2019s massive $53 billion endowment multiple times. \u00a0<\/p>\n
\u201c[D]espite amassing a largely tax-free $53.2 billion dollar endowment (larger than the GDP of 100 countries), receives billions of dollars of taxpayer largess each year,\u201d McMahon wrote in the letter.\u00a0<\/p>\n
\u201cIf Harvard prefers not to change, then Harvard should have no problem using its overflowing endowment to fund its bloated bureaucracy,\u201d the secretary wrote later in the letter.\u00a0<\/p>\n
Much of the money donated to a university\u2019s endowment is legally designated to funding certain aspects of the university, making it difficult for a school to move around the money to areas of need if the federal government goes after a school’s funding. \u00a0<\/p>\n","protected":false},"excerpt":{"rendered":"
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