Members of the House of Representatives introduced a bipartisan bill Thursday to eliminate the new excise tax on university endowments.
The bill, sponsored by Reps. John Delaney (D-Md.) and Bradley Byrne (R-Al.), would repeal the 1.4 percent excise tax under the Tax Cuts and Jobs Act signed by President Donald Trump in December. The proposed legislation follows a letter that 49 college presidents sent yesterday to Congress, urging lawmakers to do away with the tax in order to preserve their resources.
The Delaney-Byrne Don’t Tax Higher Education Act would restore university endowments’ tax-exempt status to help ensure schools have the funding they need for scholarships, research and other student services.
“Colleges and universities rely on their endowments to provide essential funding for financial aid, support difference-making research and teaching and effectively manage complex long and short term costs,” Delaney said in a statement Thursday.
Endowments provide almost half of annual revenues at many schools, according to the letter sent by the universities to Congress. The letter was signed by presidents from Ivy League schools including Harvard University, Dartmouth College and Yale University, as well as colleges such as University of Notre Dame, the University of Chicago and Johns Hopkins University.
The new tax will result in unprecedented damage to charitable resources, the presidents said.
Related: Taxpayer Ivy League subsidies and grants.
More on endowments from Brookings.